Props and Good Product

Inexpensive in-branch loan promotion pays off for Arizona State CU, this year's CUES GMA Golden Shoestring winner.

By Jon Cook

August 15, 2008

How do you build your credit union's loan portfolio on the cheap? Cathy Olague, VP/marketing at $1.108 billion Arizona State Credit Union, Phoenix, Ariz., did so by creating a low-cost in-branch merchandising campaign with a strong visual appeal to promote the CU's competitive custom construction home loans.

The $5,563 campaign helped the CU bring in $2.3 million in new loan holdings in four months, $300,000 above goal. And, it earned the CU the CUES GMA Golden Shoestring. Olague accepted the award during a banquet at CUES Experience™: Immersion Learning for Marketing, Operations and Technology Leaders held in May in Minneapolis.

Last year, the lending department approached marketing and said they wanted to promote the construction loan. The CU hadn't budgeted money for this project in 2007, but the marketing department was sure something could be done. "We brainstormed on how to get word to members," Olague says.

"Paul Stull (SVP/marketing at Arizona State CU) came up with an idea to use workbenches as props in the lobbies of the branches," Olague says. "We went to Lowes and found a workbench for $40. Then we came up with a PVC-type material with a wood-grain covering for the sign that rested on the workbench." Going forward, the cost to reprint the signs with a new rate would be minimal.

The marketing team thinks the workbenches stuck in the mind of members because of the growing popularity of home-shows currently on TV, Olague says.  

The CU also had wood blocks made with the same advertising as the large sign that sat on the workbench. These wood blocks were displayed on desks of member service reps and teller stations. When CU employees talked with members about the promotion, they gave out carpenter pencils advertising the loan offering.

The low-cost props were powerful, but they were a veneer over the heart of the promotion, the strong product Arizona State CU promoted. 

Primarily geared toward building a new house, the loan for phased construction can be rolled into fixed financing once the construction phase is complete,  which helps put members at ease, Olague says. "The all-in-one financing is where the peace of mind comes from," she says.

A special version of the loan allows qualifying members to use the proceeds from the loan to remodel their house. "This is popular with all of the home improvement shows on the air," Olague says.

The program initially ran for four months. The CU plans to keep the promotion going as long as it is viable.

The marketing team at Arizona State CU thought the product was good, but still were pleasantly surprised to have such success on a low budget, Olague says.

Taking a low-cost approach to advertising can be a great way to test a product, she adds. If it succeeds with a low-cost promotion, the CU can go after the promotion the next year with a bigger budget.

Olague and the marketing team believe in creating visual impact, as they did with the construction loan promotion, so they've come up with other ideas that use this approach. One is to take an expensive car part and put it in branches to help promote car insurance. The idea is that members will see the car part and say, "I don't want to have to pay for that out of pocket."

Olague previously worked at a smaller institution, and used to think the big CUs had all the marketing money. But she has found this isn't necessarily the case. "We have more members, but we have many of the same constraints as the small CUs. The outcome of the project shows that you just have to work with what you have."

"It's important to keep in mind that you don't always have to spend a great deal to get attention," Olague says.

Jon Cook is a CUES editorial intern. Reach him at jon@cues.org.

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