MEMBER EXPERIENCE:
Understanding Member Profiles
Knowing the channels, tools and information sources young people use to make financial decisions is crucial when developing strategies to engage with them, and this is where crafting evidence-based member profiles can be advantageous.
Intimate member profiles can be a valuable tool when considering reforms to products, processes, and technology as they encourage thinking across the organization on the member’s needs, goals, and frustrations. If you deconstruct any number of member experience strategies to their basics, most of them would include a similar objective; offering a simple, enjoyable experience for the member at every touch point with the organization.(i)
Member profiles should be based on individual needs, goals, and life events as opposed to centering on products. This means understanding every step of the customer experience, such as consideration, evaluation, purchase and post-purchase and then establishing customer expectations at each step. “Credit unions should first segment millennials into distinct profiles, figure out their goals and motivations and then create products reflecting these goals,” explains Goode.
Young people between the ages of 18 to 22 are going through some of their first and most important financial moments. These include events such as opening a chequing account, securing their first job, applying for lines of credit, and then, for older millennials, life events such as getting married, having kids, and purchasing their first homes and acquiring their first mortgages. Credit unions can only begin to develop products and services that attract younger members once they understand what these younger generations need and want at these important life stages.
A national survey conducted by Environics revealed the millennial generation cannot be segregated into a single group defined by age or other demographic characteristics such as gender, region or socio-economic status.(ii) Using our research and survey, in addition to segmentation data from Environics, MNP constructed a sample member profiling exercise for a credit union when seeking to cater to younger segments. The following table outlines five unique personas, highlighting their values, preferences and life goals, and then aligning these with credit union products.
The Set it and Forget it
- Uses financial institutions (FIs) to perform basic transactions
- Minimal interactions with FIs, with a few mutual funds and bonds in their TFSAs and RRSPs
- Doesn’t ask too many questions about their finances, and trusts that their money is being managed appropriately
- Indifferent about fees or rewards schemes
The Downtown Professional
- Lives in one of the big and expensive Canadian cities
- Important needs from their FI as they have a lot of demands on their finances
- Hates fees
- Relatively high income, but also high living expenses
- They eventually want to buy a house but crave experiences more than anything right now
Dual Income, No Kids (DINKs)
- This couple graduated from undergraduate or master’s programs in the last couple years, are now established in their careers and thinking about how to accomplish their well-defined financial goals
- Different life goals and realities than urban millennials
- Their livelihoods are similar to Gen X and Baby Boomers
- Tend to live just outside of expensive cities, valuing personal space and a suburban lifestyle
The Day Trader
- The day trader is constantly researching the best deals, rates, incentives and one-time offers
- If engaged, this person would do extensive due diligence on a suggested financial product
The Student
- Enrolled in a college or university and does not know much about personal finances yet
- Major financial service needs and keen to know more
- Born in the early 2000s and has always accessed what they needed through online and mobile channels
- Having their first experiences with the financial system such as opening a chequing account, sending large electronic transfers, providing bank information to landlords, applying for student loans, and lines of credit
Member profiling and journey mapping are important first steps in developing an actionable strategy addressing younger demographics. A recent survey revealed 85 percent of companies which have utilized customer journey mapping reported a positive or very positive impact on their customer experience. In addition, 71 percent stated the mapping projects resulted in improved customer satisfaction, a drop in complaints (48 percent) and reduced churn (40 percent).(iii) By creating distinct profiles for target millennial member segments, then walking step-by-step through the process of how these cohorts make financial decisions, a credit union has a better chance of pinpointing specific areas for improvement.
Leveraging Member Data
The development of rich member profiles often begins with an analysis of organizational data. In order for credit unions to understand younger consumers, they must first look internally at their membership base within the demographic and then assemble profiles and member journeys based on these profiles. Modern data analytics and artificial intelligence techniques are quickly becoming the norm, even among smaller organizations as enterprise technologies evolve and become increasingly accessible.
Highly customer-centric organizations are getting smart with the data they obtain from their customers and are beginning to aggregate data obtained through various systems and channels onto customer data platforms (CDPs). CDPs collect and unify siloed data into individual, centralized customer profiles, providing organizations with a 360-degree view of their customers. This means consolidating individual customer’s behavioural, transactional and demographic data from various data sources (customer relationship management, website, email, social media, mobile apps etc.), identifying who that customer is, and then utilizing data analytics and artificial intelligence (AI) to derive insights from the individual’s data.
We have seen our own clients begin to adopt CDPs, using the Microsoft Customer Insights CDP (shown above) with great success.
Customer Insights can help create personalized experiences, by utilizing a wealth of member data from various sources, and empowering internal users to act on that data. Utilizing a modern CDP can help credit unions create enriched customer profiles and drive data driven marketing campaigns that target specific individuals or segments. They can also help credit unions deliver personalized touchpoints to members based on their preferences. The enriched profiles and embedded AI technology leveraged on CDPs can help credit unions better predict members’ financial needs, goals and behaviours. For example, credit unions can analyze the behaviours, propensities, and preferences of their student members, high-spending members, members with a high propensity for loans, and members who are likely to churn. They can then use this information to trigger offers, incentives, and marketing materials at precisely the right time. This can create opportunities to attract and retain younger members.