Going beyond rewards programs

If you’ve read this column in the past, then you probably know what Buzz Points is about. We’re a rewards program that drives revenue and retention for credit unions through a localized rewards program and data-driven marketing solutions. People love being a part of something, especially when it comes to their community. Buzz Points is the only rewards program designed to specifically support the bank local, buy local movement.

The basics of rewards programs are known: give back to members in order to foster positive relationships and incentivize them to use their cards more often. That’s the basic goal that makes the ball bounce. But what about more? What about going beyond simply rewards? This article will explain how you can build a rewards program that is actually rewarding.

1. Constant Engagement

Here’s a statistic for you: 80% of highly-successful rewards programs have a dedicated team. Rewards programs that have teams dedicated to the management of the program constant engagement of the audience are common denominators in most successful programs. These dedicated teams cover everything from branch training for front line staff to email and social media campaigns for credit union members to boost participation.

By having constant engagement in every facet of the training, enrollment, and engagement, these institutions have the ability to put their stamp on the program and grow it in positive ways. Ongoing campaigns to incentivize non-enrolled members to join the program and hands on training and step-by-step assistance of branch staff are key ways a dedicated team can push the program to new limits and help it become a successful component of your business.

2. Cross Marketing

Your rewards program is more than a tool for increasing card usage and making people happy, it’s a vehicle to push other initiatives at your credit union. Perhaps you would like to emphasize auto loans? Rewards are now your currency for driving purchase behavior and cross-selling other products and services. You are using your already established program and the credibility of that program among your members to cross-market other services you offer.

This can be used in conjunction with the previous notion of constant engagement. While growing the user base with ongoing campaigns, rewards programs can be used to influence other behaviors that would benefit both the members and the credit union.

3. Build Better Relationships

It is likely new initiatives and programs implemented by credit unions are done with the hopes of them being a profitable venture. However, a rewards program is one such endeavor that shouldn’t be viewed in such black and white terms. Yes, a rewards program should help you change the behavior of inactive cardholders and drive more profitable behavior, but it’s also about simply retaining your most loyal members. Rewards programs makes people happy when they participate in an industry that is highly thought of as transactional in nature. The rewards program gives them a sense that the credit union is giving them something extra just for being a part of their services.

Last week during the CUNA GAC Conference in Washington D.C., one credit union official said that if his program breaks even or comes close to even, then it is a rousing success due to the good will it builds among his members. It’s the intangibles of member happiness and engagement that can’t be tallied on an expense report that should truly be considered when asking if you should pursue a rewards program for your credit union.

4. Member Insight

If you could know where people use their debit card, their spending habits, or the demographics of your most profitable members, do you think that information would be valuable to you? Collecting information and insight on how your members use their debit cards is process that could change the way you do business.

Processing transaction data to better understand your cardholders is no simple task. Your rewards provider can help you turn complex cardholder data in metrics that are easy to understand and easy to use. For example, if the data shows a shopping center that attracts a great amount of card traffic for the 18-35 age demographic, and that’s your target audience, you can use that to establish a billboard or ATM in the area.

The analytics data can also be used to show where your areas of strength and weakness are in respect to cardholder usage, allowing you to focus in on lagging demographics and bring them up to a desired level. Inversely, the data can be used to target cardholders who use their cards a great amount with rewards and incentives to reinforce that behavior. Having deeper insight on your members can change the way your marketing and communication campaigns are planned and executed, allowing them to be more precise and efficient. Knowledge is power after all.

These are just a few ways that you can go beyond the traditional reward program execution of handing out cards and hoping for the best. A truly satisfying rewards program is more than providing incentives for cardholders, it’s about developing a deep understanding of your members and designing engaging programs that improve those relationships to drive success.