ONTARIO, Calif.—The California and Nevada Credit Union Leagues are rolling out a soft launch of a partnership with MOGL, a San Diego-based provider of a merchant funded restaurant rewards platform.
Twenty CUs in San Francisco, Los Angeles, Orange County and San Diego are the early participants in the program, which gives credit union members the opportunity to earn 10% cash back by using their CU credit or debit cards when they eat out at restaurants that participate in MOGL.
In addition, for transactions of more than $20, a meal will be donated to a local community food bank via Feeding America.
Tony Kitt, SVP strategic innovation and planning for the two leagues, said MOGL was brought to the leagues' attention by one of its member CUs.
"The credit union was involved with a food bank in its local community," Kitt said. "The food bank had a relationship with MOGL. When the credit union told us about the program, which has strong community relations, and after looking at it we believed it aligned well. So we started developing a relationship with MOGL and introducing it to credit unions in California and Nevada."
Part of the pilot program is a "technology effort" to get MOGL and the participating credit unions connected together, according to Kitt. The leagues are developing criteria to measure success of the program going forward-including member usage, how it is seen as enhancing member value, the level of effort CUs expend and how the community element is received.
"We hope it will improve usage to the point the credit union card becomes top of wallet," he said.
The initial 20 CUs were picked based on a concentration of MOGL-affiliated restaurants in their respective service areas, Kitt explained. "We wanted to give those credit unions the best chance to succeed because members will have choices. We do not know exactly how many credit unions will join the program. We believe in it, we just want to test it."
The first credit union to go live is $209 million-asset Eagle Community CU in Lake Forest, Calif. ECCU introduced the MOGL program to its staff on Oct. 14 and 33% reportedly signed up immediately. Eagle Community will launch the program to its membership in early November.
Also signing in recent days are $408 million Vons Employees CU, El Monte, Calif., and $355 million LA Financial CU, Pasadena, Calif.
After the CCUL and NCUL were introduced to MOGL and liked what they saw, the leagues held focus groups with a dozen credit unions across California. Kitt said focus group members were shown a presentation, then asked questions regarding the likelihood of adding this rewards program.
There was no negative feedback, according to Kitt.
"We pushed really hard to see if there was anything we missed, but everything was so positive we decided to press forward with developing and launching the program," he said.
Linda Hanson, VP planning and project management, said the leagues are "very excited" about the program, "mostly because of the value proposition to credit unions and the credit union movement as a whole."
"It gives credit unions something they can offer that is unique and special, and it helps make the credit union cards top of wallet," Hanson said. "The fact this is merchant funded is amazing. It gives credit unions something they can offer to their members that they do not have to pay for."
According to Kitt, several questions at the focus groups concerned loyalty rewards programs. He said people liked the fact the MOGL program is tied to their cards, rather than having to present coupons at restaurants.
Automatic enrollment is a part of the program, he noted, adding each CU is required to offer members the ability to opt-out. Therefore, it will be offered only to members for whom the credit union has an e-mail address
Both MOGL and the leagues will offer marketing options, including statement stuffers and tablet-based signup stations in the branch, Kitt said.
"MOGL makes this a fun thing tellers can use to talk to members," he said. "At some of the credit unions that are already using it, tellers wear t-shirts that promote 'MOGL Mondays' or 'Foodshare Fridays' that help to start a conversation."
Jeff Federman, co-founder of MOGL, said the program has always prided itself on offering a platform that supports local businesses and gives back to local communities. "There is no better financial institution to amplify that spirit than a credit union," he said.