The Trellance Data Blog

Why Using Data to Understand Membership Trends is Important

Posted by Stephanie Hainje on Jun 20, 2019 2:28:10 PM


Many credit unions are struggling to retain members and capture the wave of increased credit union membership the industry is experiencing despite paying out a record level of membership dividends, helping members affected by the government shut down earlier this year, maintaining lower rates and fees, and providing stellar member experience.

5M new members joined credit unions Y/Y September 2017 to September 2018, but why aren’t consumers flocking to more credit unions in larger numbers? There are nearly 5,000 credit unions with assets of $500M or less, and some think these are the most vulnerable credit unions who may not survive to serve their membership.  Year over year, credit unions with less than $50M in assets (58% of all U.S. credit unions) have reported negative membership growth, while the top 552 credit unions with assets above $500M have experienced strong membership growth.

If your credit union membership isn’t growing, dig in and determine why. How many new memberships were opened in 2018 versus the number of closed memberships?  There is a lot you can do with your membership trends from data you already have. You can:

  1. Identify your most profitable members and apply strategies to shift low profitable members to highly profitable.
  2. Examine the behavior of long term members. What are your member acquisition products? What other products and services have been added throughout their membership? How many products and services do long term members have with your credit union? Are members using the digital products you offer?
  3. Analyze member attrition over the last 3-5 years and create predictive models to decrease member attrition. What segment of membership has the highest attrition? Do they have similar products? What products do long term members have that short-term members do not? What is the average length of membership and what do you want it to be? Does a change in address to a zip-code more than 25 miles from your credit union trigger a closed membership?

Additionally, credit unions need an internal membership champion who is continuously focused on membership numbers.  Do your employees know how many members you have?  Do they know what your membership growth goals are?  You have one, right?  Have employees been trained on how to retain a member and informed of the conversations to have at account opening, and throughout a membership life-cycle to continue developing member relationships?

Keep in mind that employee satisfaction and retention are critical to membership retention, as well.  Credit union employees are the face of the credit union, and one bad experience can taint a member’s relationship with you.  Employees who provide stellar service will become membership champions.

Credit card issuers have long recognized it is more economical to retain an existing account than to acquire new accounts to replace lost accounts. Credit Unions need to adopt the same philosophy for member retention by identifying membership attrition triggers and creating retention strategies that all credit union employees are trained on. If a member calls your Contact Center and requests to close their membership, what’s the response from your Contact Center Rep?

Aside from membership data analysis and getting your employees on board to help you realize your membership goals, credit union leaders can also collaborate with other credit unions who are successfully growing their membership and apply similar strategies in their credit union.

It’s an optimum time to begin analyzing your member data for growth.  Without it, your credit union is at risk to end 2019 in the category of credit unions with negative member growth.  To determine why your credit union membership isn’t growing, you first need to know and understand current membership trends and behaviors.  If you need help analyzing this data and guidance on how to use it to make better business decisions to grow your membership, contact us. We are ready to help!

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Topics: Reporting and Analytics, Membership, Data-Driven