LAS VEGAS—Credit unions must get better at digital marketing, as well as understand why dealers choose to send loans their way, according to CU auto lenders gathered here.
A panel of credit union executives at CU Direct’s Drive ’17 Conference made those points and others during a session that addressed the competitive landscape and best practices in the marketing of auto loans.
Sundeep Kapur, from Digital Credence, emphasized that in addition to fintechs, insurance companies, investment firms, payday lenders, large FIs and card companies are expanding their reach.
“If you look at the market share we are losing to these types of companies, it’s significant,” Kapur said. “Investment companies, look at them carefully, as they are taking things further. And credit card companies are offering us all kinds of products and services.”
While being savvy with tech marketing was a common theme in the session, service was not far behind. Brian Betza told attendees that service is what separates the $5-billion Pennsylvania State Employees CU, Harrisburg, Va., from others within the auto dealer networks.
“Making things easy for the dealers, quick decisions etc., are important. But what you can’t ignore is being available for them as soon as they call,” said the lead manager for loan originations.
Betza said that was made clear to him when he asked a dealer that sends PSECU a lot of business why they like the credit union.
“It’s important to ask your dealers who send you a lot of business why they are doing that,” said Betza.
Betza said he recently walked into a dealership that works well with PSECU and asked that important question.
“‘Just let me show you,’ the finance manager told me,” shared Betza.
The manager picked up his phone, called a carmaker’s financing arm, was put on hold and could not get through to a representative.
“The manager then called PSECU and got one of our lending experts on the phone immediately,” said Betza. “‘That’s the reason. Because I can get you to answer my phone calls quickly,’ the manager told me.”
Betza added that auto approvals make up 40% of its vehicle loans, which dealers, and members, appreciate as well. The credit union, for dealers, will also allow longer terms and sometimes pay higher advances.
He said those things are “where PSECU” fits into the auto lending picture with dealerships, and PSECU understands that.
“I think it is very important to know exactly where the credit union fits in this picture and to leverage your strengths, because price won’t keep the business,” Betza said.
The panel was also asked what they do to turn indirect members into engaged members.
Kelli Blair, SVP/chief development officer at the Bartlesville, Okla.-based Truity Credit Union, said the $796-million CU pre-approves new indirect members for a credit card and offers it to them immediately.
“We don’t do much more than that,” said Blair. “What we do instead is focus heavily on our service to all of our members, and we think that naturally brings more of these indirect members over to become more engaged members. So no hard sell.”
Kapur recommended immediately reaching out to indirect members with a question about the car they just purchased.
“Keep it simple, but make contact immediately,” Kapur said. “Maybe ask them how they like their new car.”
Betza said PSECU likes to reach out to indirect members with another loan product.
“We approach them with a cross sale on Visa,” said Betza. “After all, they came to us as a borrower, so we don’t try to bring them over with a lot of other products. We focus on lending.”
Whatever the topic, and whatever the communication channel, Kapur emphasized the importance of consistent messaging.
“Channels should be coordinated to provide members with consistent messages no matter what the product,” said Kapur, who also cautioned that CUs should not try to do too much via a mobile screen. “Be careful that the message you deliver for the PC screen is not the same length on mobile. Three lines of text may not look like much on a PC, but three lines on a mobile screen covers a lot of real estate. Shorten the message and provide links for more detail for mobile.”