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How TruStone is using data to drive more auto loans

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By transitioning its marketing and communications department to a “data-driven” marketing team, TruStone Financial Federal Credit Union has been able to increase its auto loan penetration rate.

“TruStone Financial’s 2016 auto loan promotion was the first opportunity our team had to use a more complex, data-driven approach as part of a large-scale product acquisition promotion,” said TruStone Financial’s Marketing and Communications Assistant Manager Amanda Bardonner.

The goal was to increase the Plymouth, Minn.-based CU’s auto loan penetration among current members, which included offering a new rate structure during an auto loan promotion.

“Instead of promoting a low teaser rate that is only offered for a short term length, we opted to reduce the lowest rate of all four credit tiers and offer that rate across four term lengths spanning 32 to 60 months,” said Bardonner.

In order to effectively implement the solution, the marketing team had to identify a segment of current TruStone Financial members who did not have an auto loan with the credit union. The aggregated information was then sent to the credit bureau where third-party data was cross-referenced with member records.

“The credit bureau data helped identify members who had an auto loan with another financial institution, financed at a rate at least 0.75 percent higher than the rate they were pre-approved for with TruStone Financial,” noted Bardonner.

In partnership with other departments, Bardonner explained, the marketing department deployed a three-pronged strategy to effectively deliver the pre-approval offer to members. The strategy included a personalized email, direct mail piece and outbound member contact.

“Utilizing the credit union’s CRM system, the marketing team assigned qualified leads from the pre-approval list to branch and lending staff for follow-up,” said Bardonner. “The outbound lead efforts allowed for more direct conversations with members about how an auto loan pre-approval could potentially impact their budget and financial goals.”

Over the course of an eight-week auto loan pre-approval process, TruStone Financial helped 110 members from the pre-approval list refinance their existing auto loan into a lower rate and term that complemented their budget.

“On average, TruStone Financial helped these members save $634 in interest over the life of their loan,” said Bardonner. “Additionally, the average interest rate savings was 2.35 percent amongst those who refinanced.”

Certain members realized significant savings, including 11 members who were able to reduce their rate by more than five percent, with one member decreasing his rate by 14.86 percent and another by 12.85 percent. The results helped the credit union win a 2017 Best Practices Award from Credit Union Journal.

“For these members, we helped them save thousands of dollars in interest payments over the life of their loan,” said Bardonner.

Those efforts earned the credit union a 2017 Best Practices Award from CU Journal.

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