Pass It On: A Referral Program That Works

Pass It On: A Referral Program That Works

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New members find their way to a credit union via multiple channels: word-of-mouth, indirect loans, a convincing piece of marketing.

The breadth of channels is wide; the depth of relationship incurred varies just as widely. Indirect members are notoriously difficult to cross-sell. A member that joins the credit union via word-of-mouth can bring with them a suite of products — or just one.

Economic participation is the lifeblood of the credit union business model as well as one of the movement’s seven cooperative principals. One source of new memberships, referrals, does tend to produce active, engaged participants.

“We find members who come through our Member Mania new member referral program to be more engaged,” says Holly Smith, vice president of marketing at Heritage Federal Credit Union ($601.5M, Newburgh, IN).

Heritage’s Member Mania program rewards existing members $25 and new members $50 for referrals, provided the new member meets three criteria within 60 days after first opening a checking account. First, they must take out a credit or debit card; second, they must make 15 transactions on their new debit or credit card; and third, they must enroll in e-statements.

Here, Smith discusses Member Mania, including how Heritage determined the bonus amounts, what prompted the credit union to start offering the program on a regular basis, and lessons learned.


When did Heritage FCU launch Member Mania?

Holly Smith: We’ve offered this program off and on for a little more than three years. We started running it consistently last October. We were so close to hitting 60,000 members. We finally hit that in December. It was a huge accomplishment for us, and we are proud of it.