From time to time, most credit unions conduct membership promotions that rely on their members to invite their family and coworkers to join their credit union, and in the case of community charters, friends and neighbors too. Although some members are willingly to spread the word, it can take some arm twisting to get others to act.
Regardless of how cooperative many of your members are, there will be a significant percentage that will need an extra push to refer a member. Getting members to complete a form and return it to the credit union or bring their referrals to the office isn’t easy. To be fair, members are busy juggling work, children, and other responsibilities. Referring members isn’t the first thing they think about when they get up in the morning.
To encourage members to share the savings, many credit unions include incentive rewards. Once you decide to include a reward, determining what to offer and how much you are willing to spend is the next step. Here are some examples to consider.
Cash Rewards: For many years, the most common reward was $5.00 for each new member referral that joined the credit union. Sometimes the new member would also receive an equal reward. But today, $5.00 just isn’t what it used to be. Higher cash or perceived value rewards simply get a better response. It is true that some credit unions are successful with a small reward, but don’t be surprised if your response rate is low. The Raddon Financial Group recommended from a $15 to $25 for incentives, and that was for each new service and account acquired by a current member. Higher
reward amounts are closer to reality, with some credit unions offering significantly more.
Sweepstake Rewards: A higher perceived value incentive can help motivate members to complete a referral form and then return it to the credit union. One solution is to reward the member for making any referral, without requiring the referral to join the credit union. Their reward could be a sweepstakes entry for every referral they make. Popular prizes include assorted electronic devices, including a Blu Ray player, iPod, iPad or an Apple Watch. A substantial cash prize is another popular option. Some credit unions are willing to invest even more. Mini vacation getaways and big screen TVs are popular prize options.
One large South Carolina credit union offered a vehicle as a grand prize. They had it wrapped in removable credit union brand advertising, then drove it to community events. It generated nearly 10,000 new checking accounts and new members. Other credit unions have successfully used jukeboxes and even snow blowers as prizes.