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Connecting strategy and audience for better results GTE Financial Featured in CU Today 10/1/17

1 CU’s Secret To Loyalty Program Success

10/01/2017 12:29 pm

By Ray Birch TAMPA, Fla.—Loyalty programs are critical to a credit union’s future, contends GTE Financial, but are only effective if those programs are fun and simple to use, and don’t require climbing a “mountain” to get the reward.

That’s the thinking behind GTE’s recent launch of Go Points, a rewards program that seeks to drive deeper relationships and which touches virtually all of the credit union’s product and services. Members can get points for just about anything they do at the CU, with the points going straight into a rewards bank to be spent however the member chooses.

“It’s a simple bank of points you spend like cash on a menu of products and services that have point prices,” explained Jennifer Maxfield, VP of products and services. “It’s that simple. We pool your points for you, you go into online banking and there they are, and you can redeem them easily through online banking, as well.”

Maxfield said that the $1.9-billion GTE Financial believes the Go Points name will have a big impact on the program’s success.

Wheel Of Fortune

“What we like about Go Points is that is makes it clear this program is actionable. Go Points sounds fun and the program is not stuffy,” she said. “When we rolled it out we had a digital Wheel of Fortune that when you enrolled you got a free spin for bonus points. It’s all about gamification.”

As Maxfield explained, Go Points can be banked many different ways—opening a GTE home loan, using the CU’s credit or debit card, taking out a home equity loan or line of credit, an auto loan, member referrals and more. Members can redeem points for things like a .25% bump up on a CD rate or .25% discount on a loan. Points can also be redeemed for airline tickets, hotels, cash back, gift cards, merchandise and other rewards.

Points vary by the business benefit to the credit union, so a home loan returns 12,500 points, compared to 500 for taking an e-statement.

The credit union rolled the program out via a soft launch in mid-July and in mid-August began marketing Go Points. What is most important about the program is that is does a very good job of returning value to members, said Maxfield.

She told CUToday.info that GTE’s previous loyalty program was not wide reaching, as members had to meet certain qualifications to receive benefits. That limited the program’s effectiveness and ultimately led to its demise, she said. “With Go Points you can bank as little as 3,000 points and get $25 cash back, if that is how you choose to redeem,” Maxfield said. “Before you had to accumulate 20,000 points before any benefits were returned. With Go Points, it does not seem like you have to climb a mountain to get rewards. If you sign up for e-statements, direct deposit, and courtesy pay debit and do one member referral you would have 4,500 points. You basically get paid for what you do.”

What also spelled the end for the previous loyalty program, which is being retired at the end of the year, is that it was confusing.

“I could not explain the program to you in less than a minute,” Maxfield said. “There were layers and layers of qualifications. Our sales team had a paragraph pitch, which is far too much to say.”

All those qualifications also limited the reach and ultimately the success of the previous offering. The old Member Advantage program could not break the 40,000-member enrollment level. GTE has more than 250,000 members.

170,000 Eligible

Product Manager Paul Hinrichsen said that today more than 170,000 members are eligible for Go Points and that 8,000 enrolled in the first two weeks of the program despite the soft launch.

“We are very pleased with the results and we believe enrollment will pick up a great deal once we begin marketing in earnest,” said Hinrichsen, who said a large, coordinated advertising effort is backing Go Points. “We hope we will get past 40,000 members enrolled by the end of this year, and we think intertest will really pick up as the holidays arrive and people are looking to use rewards points.”

Maxfield recognized that with the many rewards programs being introduced by all lines of businesses, that consumers are simply expecting rewards from their financial institution.

“Points and rewards strategies resonate with members today, especially Millennials,” she said. “There is a lot of data that shows rewards programs strongly influence shopping behavior, and that means at the credit union too.”

A video explaining the program can be found here: https://www.gtefinancial.org/for-members/go-points

