Credit unions dig into data to offset slowdown in lending

With lending slowing in part due to the ongoing economic downturn brought on by the pandemic, some credit unions are turning to data analytics to help bring in new business.

Altra Credit Union in Onalaska, Wis., has used data from key lifestyle indicators – including marriage, pregnancy, homeownership and other factors – to not only find members making mortgage payments to other institutions. It has also dug into predictive data to better understand which members might be in the market for specific loan products. For example, the $1.95 billion-asset credit union can single out members going online to search for things such as the loan-originator pages on its website.

“So we knew they had that intent that they wanted to take out a loan or refinance,” said Cheryl Dutton, vice president of marketing, speaking during a panel discussion at the Credit Union National Association’s online Governmental Affairs Conference this week. Those members then received unique offers within online and mobile banking, and Dutton said more than 2,000 members have followed through on those opportunities, resulting in over $198 million in revenues to date.

Altra plans to do more targeted marketing to see if those new mortgage customers need other products and services, such as checking accounts and auto loans.

As the pandemic improves, credit unions are now turning their attention from helping struggling members to finding new members and revenue streams, and data will play a big role.

As the pandemic improves, data should be seen as the “power and intelligence” that goes into every decision the institution makes, said Rob Heiser, co-founder and board member of data provider Segmint, Inc. The industry must continue to look to firms like Amazon and study how they maximize available data to anticipate their customers’ future needs, he added.

“Your data has to be accurate and timely and relevant or you might miss the opportunity to have a really impactful conversation with [a member] on an important part of their life in which they have to make a decision,” Heiser said. “You have to crunch the data in a way that you really start to understand the needs of your customers before they even know what they’re thinking about it,” he said.

Pacific Service Credit Union in Concord, Calif., is taking a similar approach, using data to craft targeted marketing campaigns for members.

“You really can’t avoid us if we feel that it’s the right product for you at the right time,” said Mark Cardella, assistant vice president of marketing and communications at the $1.32 billion-asset institution. “You may not know that you need it yet, but we know.”

Dutton, Heiser and Cardella were joined on the panel by Blake Lyons, vice president of marketing and business development for Randolph-Brooks Federal Credit Union in Live Oak, Texas. The discussion was moderated by Becky Summers, leader of marketing solutions for Raddon, a Fiserv Company.

Pacific Service and Altra’s use of data to help find new growth opportunities has partly been a progression of how it approached member service when the pandemic first hit last spring.

Altra was able to use data to find members who were collecting unemployment payments. While early on very few members were receiving those benefits, that quickly changed, and eventually more than 5,000 Altra members were on unemployment, or a little more than 4% of its total membership.

Representatives then reached out to those specific members with offers to help with issues such as 401-K rollovers or to offer no-cost financial-planning sessions.

Pacific Service also used targeted data to find members who were hard hit during the pandemic by looking at members who stopped getting direct deposits, said Cardella.

The credit union then reached out personally to each of them.

“What we found that they may not have needed our assistance, but the fact that we contacted them…the response was incredible. It was the way we made them feel as members — that we cared. And I think that separated us from some of the big banks,” he said.

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