Marketing and Operational Rewards of E-Statements

Greg Crandell, DigitalMailer, Inc.
August 25, 2005

In recent years, e-statements have attracted the attention of credit unions, largely due to the cost and time savings they provide. And it’s true –e-statements offer significant savings in postage and delivery costs compared with mailing paper statements, which can cost anywhere from 75 cents to more than a dollar each to print and mail. For many credit unions, these benefits alone make e-statements a highly attractive option, favorably affecting the bottom line. Smart move.

But e-statements offer much more than simply the time- and cost-savings benefits associated with the statements themselves. Think about it: Providing e-statements means your credit union has possession of a highly accurate e-mail distribution list and permission to responsibly communicate with your members via an efficient tool. E-statements are fast becoming the gateway to effective member communication. By giving permission to use their e-mail addresses, members create a strategic contact point for your credit union and become a partner in choosing how they prefer to interact with you. The benefits are clear: E-statement e-mail addresses provide an inexpensive, customized, permission-based, fast, closed-loop, member-service system that informs, sells, delivers, and satisfies.

Use but Don’t Abuse

E-statements are one of the easiest ways to help members develop an “e” comfort level with their credit union, which supports their entry into other e-services and a positive online relationship. But while e-statements provide a highly effective path to a member’s e-mail in-box, the e-mail relationship must be treated carefully. Research indicates that 70 percent of credit union members are willing to give their e-mail addresses to their credit unions – as long as they aren’t abused. When a member gives your credit union an e-mail address, you become an “invited guest” – not an uninvited pest – into that e-mailbox.

So, with valuable e-mail addresses in hand, what’s the next step? Start using them wisely. A significant point of influence to your members who are considering e-statements is the ability to “opt-in” on the types of messages they will receive. This electronic alert feature gives members control of the messages sent to their e-mailbox. According to a report this spring by Forrester Research, adding preference-based “e-lerts” to e-statement technology will become a key factor for credit unions wishing to deepen member relationships. Although only 26% of U.S. online consumers now receive e-mail alerts from their financial providers, the figure will grow dramatically as institutions educate their customers on the value of alerts and provide the right kind of alerts.

"More and more of our members are interested in e -solutions," says Frankie Duenas, VP of IT for Cabrillo Credit Union ($150 million assets) in San Diego, CA. "The e-statement is a great e-service to offer them. We were one of the first credit unions in the San Diego area to offer this and our members responded positively. To date, about 10% of our members use e-statements. Additionally, it has been an effective way to acquire e-mail addresses and promote other e-services, not to mention the cost savings to the credit union."

Ease Operational Headaches

Many credit unions have experienced success in generating additional revenue by putting their valuable e-mail addresses to work, creating a second and sometimes third monthly e-mail contact with the member. In addition to targeted marketing offers, an e-mail describing process changes, a disclosure statement or an “alert” notification have proven beneficial to credit unions in generating additional business while reducing operating costs.

Case in point: One large credit union receives hundreds of calls every payday from members checking to see if their paychecks have been posted. With valid e-mail addresses for more than 40 percent of its members, the credit union began sending e-lerts to notify members when their checks arrived. This quick electronic notice significantly eliminated the credit unions’ call center volume.

Here’s another example: A credit union experienced success in generating new car loans by targeting selected e-statements users. Using database information and its e-statements engine, the credit union identified members that most likely had car loans elsewhere. Once identified, the e-statement program delivered tailored offers to 8,700 members. Over the course of three months, 117 members were accepted for new car loans totaling $2.3 million.

And consider this: For most credit unions, the cost of check-image technology used to be prohibitive – but the Internet and web-based technology have changed that. Today, credit unions that offer e-statements with check-image access are finding their member adoption rates on the rise. More and more, members are happy to trade paper statements for e-statements that include 24/7 online access to check images. More importantly, access to check imaging can deliver copies of checks to a member 2-4 days faster than traditional methods, freeing up credit union personnel so they can focus on providing high-quality member service.

Whether your credit union is an active e-statements provider or still considering such a program, take a look at the big picture. The benefits of e-statements – significant in saving your credit union operational staff time, and postage and paper costs – are further enhanced when the marketing and operational rewards are considered together: a guaranteed contact with members each month, e-mail addresses provided by your members along with permission to use them, and members who want ops notices sent to their in-boxes.

Greg Crandell is vice president of DigitalMailer, Inc. (www.digitalmailer.com). He can be reached at gcrandell@digitalmailer.com or 866-994-4900, extension 106.