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The CU2.0 Podcast
This podcast explores contemporary, critical thinking and issues impacting the nation's credit unions. What do they need to be doing to not just survive but prosper?
The CU2.0 Podcast
CU 2.0 Podcast Episode 357 Supercharging New Member Acquisition with AI: Education Credit Union
Want to know the secret about how to better target a new member acquisition campaign?
Of course you do.
Just about every credit union in the country is scrambling to gain new members - but could the campaigns be more efficient and effective?
In many, many cases the answer is a loud yes.
Enter Vertices Which is blending data and AI to give credit unions tool to enable more precise targeting strategies and tactics.
On the show is Mitch Rutledge, CEO of Vertice AI and himself a past podcast guest, episode 247,
But don’t take just his word.
Also on the show are business development specialist Tiffany Sharpensteen and Bradley Herbert, senior VP of technology, both of Education Credit Union of Amarillo, Texas which has assets around $480 million. Education shares its experience in the pilot program of Vertice ACQUIRE - and, yes, the reviews are glowing.
Listen up.
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Welcome to the CU2.0 podcast.
SPEAKER_01:Hi, and welcome to the CU2.0 podcast with big new ideas about credit unions and conversations about innovative technology with credit union and fintech leaders. This podcast is brought to you by Quillo, the real-time loan syndication network for credit unions, and by your host, longtime credit union and financial technology journalist, Robert McGarvey. And now... the CU 2.0 podcast with Robert McGarvey.
SPEAKER_03:Want to know the secret about how to better target a new member acquisition campaign? Of course you do. Just about every credit union in the country is scrambling to gain new members. But could the campaigns be more efficient and effective? In many, many cases, the answer is a loud yep. Enter Virtus, which is blending data and AI to give credit unions a tool to enable more precise targeting strategies and tactics. On the show is Mitch Rutledge, CEO of Virtus.ai, and himself a past podcast guest, episode 247. There's a link to that in the show notes. But don't just take Mitch's word. Also on the show are business development specialist Tiffany Sharpenstein and Bradley Herbert, senior vice president of technology, both of education Credit Union of Amarillo, Texas. Assets of around$400 million. Education shares its experience in the pilot program, Virtus Acquire. And yep, the reviews are glowing. Listen up. My experience is that credit unions are non-selective in new member drives. And they often get a bunch of members who are not profitable you can't make any money if someone comes in and opens a share draft account puts a few bucks in in a savings account and that's it this is this is so it's the pathway to financial despair so you at vertis have some magic potion that allows allows credit unions to better target the members and i want to hear from you about The technology of this, I want to hear from the credit union about, does it actually work? Because fintech guys come and they lie to me. You know that? This might surprise you, but they don't lie. They exaggerate. Let me put it that way. Lying is, hey, I get along very well with fintech guys.
SPEAKER_04:But it's... So, Robert, I'll kick it off. This is Mitch Rutledge. So at Virtus, we were on... You had us on, I think, a couple of years ago as we were just getting started. And we originally founded Virtus to focus on how do we empower credit unions to help their members climb their financial mountain? So this idea of growing the relationship, member economic participation with the existing members, which is... very important. And, you know, we've seen great strides with credit union clients over the last few years of doing that with BERTIS, including an education. That's where we started with them. But we also know that growing the membership and getting new members is important to the credit union movement for a variety of reasons. And we said, how can we take what we learned about knowing existing members to help credit unions know perspective numbers and find What could be the best possible prospective members to help them grow the financial relationships? And that's what we created Virtus Acquire, to leverage what we learned about existing member growth to apply it to finding the best prospects for the credit unions, those ones that will have long-term growth potential that aren't just one product or rate shoppers. We want to use all of the insights and data that we have about existing members to find what are our our best members who are the most economically participant to then go find prospects that look like those. So much more than just a quote lookalike model, it's a pretty advanced way of using lots of data elements to find prospects.
SPEAKER_03:Do the prospects, profile of a prospect differ from credit union to credit union? I mean, obviously there's some like maybe federal where you need a particular background. That aside, Do they differ?
SPEAKER_04:Yes. So that's what we're starting to see in this. So we just launched this product at the beginning of the year. And so we're education was our first partner on helping us deploy this. But we're now working with four credit unions and we're starting to see that, yes, there are some similarities about what is a. highly participant member. But again, in different markets and credit unions with different, you know, traditional membership bases, right, fields of membership, there are definitely some uniquenesses around it. And that's, again, where we think that our models can help them identify, you know, who are the best future members for their credit union. What's the size range of these credit unions? Under 500 million to approaching 2 billion. So all sort of, you know, we think the sort of the full gamut
SPEAKER_03:of folks. Is that the range that you think this product is best suited for? No,
SPEAKER_04:I mean, we're talking to some smaller credit unions as well who, you know, I think all credit unions have a priority for adding new members, right? I think that I just saw the, you know, the Callahan MarketWatch survey, right? And that was the number one focus of credit unions for 2025 was new member growth. So I think all credit unions have that as a priority.
SPEAKER_03:But a credit union doesn't want indiscriminate new member growth because some new members can actually cost the credit union money. For sure. Quite a few new members cost the credit union money, unfortunately. So what you say is that you have this potion that will help them identify people who will not be money losers as members.
SPEAKER_04:Well, I mean, I think I'd love to turn it over to my friends at education to talk about some of their strategies for new member growth. Part of the credit union movement is about how do we serve our community. And it's not just about what are our profitable members. We want to serve the community. And we know that's a balance across all of the members that we take on. And I think that's part of the decision process as we think about finding new members. is what is our priority right now? Is it deposit growth that we've heard from some folks? Is it, again, these long-term members that may take more time to grow into? We think about some of the focus about youth and getting the next generation of credit union members. Well, some of those members may not be profitable now, but when we think about the long-term, and I think most credit unions do have a long-term horizon, those are ones where I think having a long-term outlook on potential growth is a really important part of this.
SPEAKER_03:But it's not an either or, I think. Education. Now, why did you sign on as the guinea pig in this thing?
SPEAKER_00:Well, I think that, Robert, you mentioned something at the very beginning, and that is these typical large net casting membership drives that credit unions are known for. And something that our team has been really interested in is how can we provide more relevant offers and services that really strengthen long-term membership loyalty and not just bring them in for the little gimmicky radio that we're giving away today? How can we really be their full financial provider covering everything that they need? And so Virtus was initially attractive because they offered this AI service data-driven strategy. And we really felt like if we didn't embrace something like that, we would frankly risk falling behind.
SPEAKER_03:Technologically, how hard is it to use the Virtus technology?
SPEAKER_00:Well, from a user experience from my side, I don't live in the data world. I'm marketing. And so I am fairly analytical. And so it interests me, but it's not my day to day. And so it can be a If you truly just embrace it, jump both feet in. I felt like the team, the Virtus team, they're top notch exceptional. And so they were able to walk alongside us the whole way. And myself and my other marketing colleagues that a lot of times were spent in graphics and designing, we were able to pick it up very easily.
SPEAKER_03:When did this go live?
SPEAKER_00:Speaking to the acquire piece of it specifically, we've been visiting with Virtus and working through small campaigns, I'd say over the past year, maybe year and a half or so. But acquire specifically, which gave us this entry into the prospect world, which is honestly a question that I had asked Virtus initially. How do we get into the prospects? How do we tap into some non-members? We were able to really start this initiative, I believe, in about mid-November. And we started it, Education Credit Union started it specifically on a smart checking campaign. So it's just a checking account. We have a really exceptional checking account product that offers over 6%. And so we... We didn't offer any additional incentives or anything with it. It's just what our product already is in its glory. And so we started that in November and we wanted to launch it initially about an eight week campaign to see what kind of results that gave us. But because we have been seeing really exceptional results on our impressions and clicks, we're continuing that campaign.
SPEAKER_03:6% is pretty outstanding. My credit union has a great rate of 0%.
SPEAKER_00:Let me send you a link after this with our... Our information.
SPEAKER_03:You said 6%. I'm saying, well, you got my attention there.
SPEAKER_06:I'd like to expand on a couple of the things Tiffany mentioned in there and kind of answer your questions from a little bit of a different view and a little bit deeper. One of the big reasons why we did choose to go with Virtus, Tiffany did mention that they're a phenomenal partner. And regardless of how perfect or imperfect pieces of the tool are, they always step up to help bridge that gap, which is something we look for in any technology. You know, technology should not be replacing human beings. It should really be amplifying what we do every step of the way. And they're a good example of that and of, you know, really filling in those gaps, helping to lead through to what the intentions are, what the possibilities are, and keep that human part of the technology. So that was a big part of why we went with them. And they continue to prove that. One of your other things, you know, you were talking about just our strategy and how we kind of approach it and identifying who are those profitable members. Because even though we are a credit union, We're not a business that's generated to create profit. It's to serve the members. But we are still a business. We have to create that in order to serve the members. But it's not just about identifying who is profitable up front and who will immediately step in, but continuing that journey and really identifying how do we keep them profitable? How do we create a profitable relationship with those that we already have? You know, Virtus does a lot of that as well. It's not not just the intake where we create that path.
SPEAKER_03:With a money center bank, I have a Chase account. Once you open up with Chase with any product, they're going to tempt you to sign up for more and more products. It's kind of like your street corner drug dealer. Wow, this is free, but oh wow, this one's not free.
SPEAKER_05:Your references are killing me, Robert. Your potions and drugs.
SPEAKER_03:I'm assuming Acquire does not need any core system access, right?
SPEAKER_04:No, it does. We are using, we need to know about the existing members and we get that data from the core. So I would say that part of our approach is, or a key part of our approach is leveraging, what do we know about your existing members? And what defines a, you know, what are good, highly participant members for your credit union? So that we can use that to find, and that's not just about, you know, demographic information. It's more about transactional behavioral information as well, right? What are the behaviors of those members? So that we can then go and find the prospects that, you know, again, we can grow into be those highly participant members over the long term.
SPEAKER_03:Now, can you extract data from the core that shows you member journey? Yes. You might remember once upon a time, a lot of financial institutions were aggressively recruiting college kids who probably were not very profitable at all. But when they turned 24 and they had a job and they got a new car, did they get the car loan from you? When they got to be 30, were they looking to buy a house or something? Did they get a mortgage from you? So you can pull that data from the core.
SPEAKER_04:That's exactly right. We have all of that data and we, that's a, you're spot on Robert. That's one of the keys about what we're modeling is what is the journey of these members over the long term? And that is an important part of how do we think about the next you know, generation of prospective members. And it's not just about youth. I think that is one strategy that many credit unions are focused on. But it is more broadly about the entire community and where the opportunities, again, people are moving in. And, you know, again, if it's geographic, people are moving. And how do we make sure that we're hitting the right new people in the communities to engage?
SPEAKER_03:Well, the historic credit union model, and I'm going to grossly simplify, but in a way, it was a simple business some years ago. Young people borrowed. They had credit cards. Old people threw money in a savings account or some other way that the credit union could lend that money out, and it was a spread business. You lived on it. Your profit was the difference between the interest rate on loans and credit cards and the interest rate you paid to the old people. Now, I'm an old person, so... It's not making fun of all the people here. But the business is much more complicated now, credit union business. And those credit unions have multiple income streams. So you can track that kind of stuff.
SPEAKER_04:Yeah, I mean, we're looking at all of the activities that a member does with the credit union. So that's about accounts and transactions and interactions that they have. And all of those go into understanding what are my highly participant members that I want more of. And part of this, we can model if there is a profitability aspect. But to date, we haven't had credit unions that have made that a priority in how they think about acquiring new members.
SPEAKER_03:What's the difference between new members who don't really gel for the credit union and ones that do gel for the credit unions? I mean, I know a lot of credit union people don't like the word profit. They're actually talking about profits. They just don't like that word. But as Bradley pointed out, if... And as NCUA would certainly agree with me, if you're not making something that looks like profits, you've got problems with the regulator. So now how do you distinguish? How do you look at a prospect and say, okay, this is a prospect that this credit union really wants?
SPEAKER_04:I'll take the first crack at that, but then I'd love for Bradley and Tiffany to comment. So within Virtus Acquire, we have something, we have created this, what we call Acquire Score. And we're looking at really two dimensions of these prospects We're looking at, can we get them and can we grow them? And can we get them is sort of that answer of, is there a product that they score high on propensity for that they might want that we can get them in, right? They're potentially rate shoppers or high rate certificate could be a driver that they'll one, give us that money, but they may not grow with us, right? So this is where we go into that journey that says these members show that high propensity that they want. have growth potential to be, you know, multi-product members over time. And we show those scores in this, you know, sort of what we call the acquisition matrix of can we get them and can we grow them? Because there's times where, again, we've seen this last year where there was just a focus on liquidity, right? Go get deposits, right? You know, we probably know that there was lots of that. We just need to make sure that we're focused on the balance sheet and we'll deal with it. Can we grow them later? So we want to give the flexibility and the insights that these credit unions can make those decisions about where do we want to focus today. And, you know, we know there's always tradeoffs. And so there may be a time where we just say we want, you know, quick loans or quick deposits. And we can give you that, right? Single products. Let's go get auto loans or let's go get a certificate. But there's also times that we say, no, we want to think about the broader long-term growth potential of members. And there may be different times that we want to have different strategies and we want to be able to support that.
SPEAKER_03:So you can change this on the fly. I mean, there was a time when... credit unions really, really, really want to make auto loans. Then there was a subsequent time when they really, really, really didn't want to make auto loans.
SPEAKER_04:Yeah, you're exactly right, Robert. So we're providing a user experience for the marketing and strategy and executive teams of credit unions to really see where are the opportunities for growth, and then they can make decisions on what campaigns they wanna execute, right? So we can give you the, here is the prospects in your area that score high for auto loans and potentially you could grow them. Do you want to build a campaign around leading with that potential product? Same with checking as Tiffany mentioned where they started, which is who shows high propensity for our checking product in our area that we don't have already as members and we can grow them. Let's focus on that. So it absolutely gives them an easy way. And that's where we think we're different than most of the solutions in the market like this, where we let the credit union see all of this and they can make informed data driven decisions about what strategies they want to execute and what's the potential size of the prize for them versus, you know, historically it's been we either hire a consultant or an agency and we kind of put it all in their hands to go and do this. Or there's solutions that are very product centric, right? We can go get new members for checking accounts or we will just get you, you know, HELOC new members so we want to give them the flexibility to see it and make these informed decisions and understand the trade-offs of hey we can go get quick loans or deposits in this particular target audience or we can think about a longer-term growth strategy with this other audience and they can do you know they're not mutually exclusive right we can be running multiple campaigns for acquisition for different products and services, but they're all data driven and focused on putting the right products and services in front of the right prospects instead of the, you know, call it the old spray and pray model.
SPEAKER_02:Now,
SPEAKER_03:how will you measure the success of this, of your product? And I ask because it's tricky since a lot of the success is long range. In other words, this new member that I get today, next year might not be all that great. but your model is saying, well, five years from now, this person's going to be exactly what you want.
SPEAKER_04:It's a great question. Go ahead.
SPEAKER_06:Oh, no, you have at it, Mitch. I know this is something we've talked about a lot, and it really is the perfect question. And there's more to it than just being a long range decision in peace. It's figuring out what to truly measure, how that impacted. I mean, I know Tiffany goes over this stuff over and over and over and what really matters. And definitely, Mitch. So have at it, Mitch.
SPEAKER_04:I'm going to lead with we're early days into this. I think we are our hypothesis around measurement was clearly around How many new members can we get through these programs compared to the old ways of doing it? Are they more efficient and more effective prospecting campaigns? Are the... products and services that we're gaining with these new members, you know, what we would expect, are we getting, you know, products? And I think that's one of the learnings that we had, which is we need to make sure we measure all products that we, you know, we may have targeted for a checking account, but if at the same time we get a member that adds another product and they don't add a checking, that's still a win, right? We're potentially getting, you know, they started with a different product. So I think measuring what that is, we do know that the long-term aspects, we're just going to have to, you Tiffany alluded to, we're seeing initial positive results of higher interactions and engagement rates. So the short-term measurement is, are we seeing higher response rates to our outbound marketing and engagement, right? So that's sort of the short-term. The kind of the next medium term is, are we seeing new members adopting products and services at a either equal or greater rate than we historically saw for the dollars that we're spending on gaining those new members. And then to your point, Robert, the long term will be as are we really growing these into highly participant members over the next 12, 24 or further months out? And that's the part that we, you know, we don't have yet, but we have a view on how we want to measure it.
UNKNOWN:So.
SPEAKER_03:How will you price this? I'm not asking you what you're charging education. That's probably a very special deal. How will you price it when you roll it out into the general market?
SPEAKER_04:Well, I'd love to come back to that, but I feel like, Tiffany, I'd love for you to speak to that last question. I'll maybe put you on the spot if you have any other thoughts on measurement and how we're thinking about the impact that this is happening.
SPEAKER_00:That's a good question. I think one of the things that I can appreciate most about the Virtus solution is the We're sending data back to the solution on a weekly basis, and that's just what we chose. And so we're able to see immediate results. Immediately we can say, this is the amount of accounts that were open that we can tie back to the marketing campaign. And a lot of times those are immediate results. we certainly want long-term sustaining members, but we also need very immediate results that can be tied back to the marketing campaign. And so something that I really can appreciate is that you can just log into the platform and get those very quickly.
SPEAKER_03:Now, Tiffany, what pain point was the credit union suffering where you said, the credit union said, hey, We're going to take a chance on this new Vertix product. There had to be a pain point that motivated this.
SPEAKER_00:Yeah, I think that our... Previous methods of member acquisition were just too broad and inefficient. And so we really wanted to research a more targeted, personalized, data-driven approach to maximize our marketing resources. So we had to enter a whole new mindset of how to approach member acquisition and growth with the Virtus tool. And so those pain points were quickly alleviated because not only are we able to go in and select our target audience, but that additional built-in model that Virtus provides, the AI part of it is super helpful because we're not just guessing, we're not just saying, from the transactional analytics, we're not just saying, that we want to target members who use payday lenders because we certainly want to tell them and show them that we can be a more affordable, fair solution for them so that they don't have to use payday lenders. But the Virtus.ai tool can also model out there's other members that are more propense to accept this as well. They're very likely to be using payday lenders that we can't see from the ECU lens. And so, yeah, it was certainly able to help us approach our marketing with a more targeted, personalized approach.
SPEAKER_03:So the traditional marketing you were using was not terribly effective, I'm gathering. And I think this is true for most credit unions. I get solicited for all kinds of products that I just buy my mailbox, there's a trash can. Almost all of that material goes directly in the boom, boom, boom, boom, boom. It's just horribly inefficient.
SPEAKER_00:Yeah, I agree. It certainly wasn't particularly effective. And it wasn't telling us what was working and what wasn't working. And so with the Virtus.ai platform, like I said, you know, we get those immediate results. And so we're very quickly able to say, hey, this is working really well. Let's dig in our heels and take this to its full capability. Or, you know what, this one, we're not getting a lot of traction with the direct mail and this particular marketing campaign. Let's take a step back and determine, is this our create Is it the target audience? So we're able to move quicker with this platform. And
SPEAKER_03:what's something that's worked really well that perhaps you were surprised it was working so well?
SPEAKER_00:Good question. I'll let Mitch or Bradley take that one. I
SPEAKER_06:can take a little bit of a stab on that and an expansion of what Tiffany was talking about. I mean, it... So many people underestimate the power of transactional data in just understanding your members, understanding their needs, their patterns or history, things like that. And a lot of what it provides us is not just the ability after the fact to be able to pivot if something's not going in the direction we thought it was going, but understand a little bit better on how to approach upfront. And it's not just who falls into that, but it's how do we communicate with them? I mean, you see through the transactional history and patterns of our members, what matters to them, what they spend their money on, where they go with those sort of things, what their needs are. And that changes the strategy for just who we market to, but also how we market to them and how do we make sure we've got the right products for them to solve those needs. So it really, I mean, it's a roundabout way of answering your question, Robert, about something that's surprising, but it never ceases to surprise me the power that is in transactional data and just knowing our audience and being able to I'm
SPEAKER_03:guessing that your methods of marketing have changed dramatically over the last 20 years. 20 years ago, probably it was a lot of direct mail stuff. Whereas now it's, you tell me what it is, it's probably a lot of digital stuff.
SPEAKER_00:For sure. And something that we're able to, maybe this was a surprising piece of the platform, is that After we identify the most propense target audience, we can craft our marketing methods, like Bradley said, and our collateral around the demographics of that specific target. So no longer are we just saying, oh, we want to market to 18 to 24-year-olds. We're letting the platform tell us who we're marketing to. in terms of who's the most propense. And it's going to spit back and say, this is the age range that is most propense to adopt your products. And these are their marketing affinities. They are not going to look at direct mail. They are absolutely going to be more interested in digital video advertising and email is going to be a heavy hitter for them as well. So it's nice because it gives us a lot more insights than what we would have probably just gambled on, on just going by our own feelings.
SPEAKER_03:Yeah, I think a lot of historic marketing decisions were made just gut instincts.
SPEAKER_04:Robert, just picking up on that. And one of the things that I think is we're excited about what Tiffany and her team are picking up on is the ability to just do much more micro campaigning. And it's a transition and it takes time and effort, but we're trying to make it as efficient as possible for them to be able to say, yes, this group is going to respond to direct mail. There is a group of people that will respond to that. There is a group of people that will respond to in-app messaging, and there's a group of people that will respond to email. And we need to make sure that we use the right channel and the right tactics to engage with each of those groups within the the same campaign, right? And it's not, we shouldn't use everything on everybody. We need to be, use the data to determine what's the best tactic and message to engage with each member. And that's one of the things that we're trying to efficiently get to those micro target groups.
SPEAKER_03:Yeah, tell me about a micro campaign. And this, it could be Virtus talking about this, could be education talking about it. Maybe both of you want to talk about it. You know, put some flesh on that. What is a micro campaign?
SPEAKER_04:Well, from our perspective, it may not just be a complete campaign. It just may be an audience that we're going to take a different tactic or message to. Right. So I think about one of the things we did at education was pushing some specific messaging through the digital banking app. Right. Obviously, there's a select group of people that are, you know, have those, you know, are heavy users of the app. the digital banking app, but we, we did a scenario where we pushed some messaging to the, to those folks. So I think it could just be within the same campaign, but it's, it's creating these, maybe it's more micro tactics and, um, you know, sub campaigns of how we're going to engage differently. And I think the same for this acquire piece, right? We had a subset that got direct mail, a subset that got digital targeting, uh, within the campaign as well. So, so that was part of the programs here.
SPEAKER_03:And I think historically at credit unions, everybody got served the same dish. Every prospect was... And obviously there were better ways to do that, more efficient ways to do that. For sure.
SPEAKER_06:And Robert, there's another way, I guess you can talk about those micro campaigns that we're really working on, haven't fully implemented yet, but helping to even just from... a footprint of our branch locations and giving each location the information they need to truly know the members that they're going to interact with, the ones that they see walk in, know some things to be able to talk to them about to be able to have the communication, or even maybe just a short little micro campaign around phone calls for a subset that we see a need and they can approach that and really even breaking that out to the location, to the branch level level or just to the wider aspect you know we might not have a full build out where Tiffany's creating material and you know generating communication but it's something that simplifies down to hey here's a list of members you see them come in there's a talking point for you or here's a list that we might need to call and engage a conversation on
SPEAKER_03:Now, the credit union has to be pretty good at developing micro campaigns, has to be pretty clever about creating the concepts behind these campaigns. How widespread is that talent in credit unions?
SPEAKER_06:I almost feel like we're walking into a trap with that one, Robert.
SPEAKER_03:Hey, everything I do involves traps, man. I'm a journalist.
SPEAKER_04:Let me start there and then Tiffany, I'd love for you to do that. So I'm going to tease a little bit of what's coming because this is, you know, I think one of the things that we recognize was as we, you know, see the value of doing more hyper-targeting, hyper-personalization, that comes with, okay, well, now we have to create the messages and the content and the copy to do that. And as a marketer, I'm sure Tiffany says, wait, how are we going to do that? So that's the next big part of what at Virtus we are offering. When we now create these hyper-personalized campaigns, we need to help enable creating the copy for that. And so we've just recently added a new piece that Tiffany and team haven't yet taken advantage of, but we're hopeful they're going to do soon called Virtus Compose. And that is really how do we create many versions of copy or content for your marketing campaigns that leverages a common theme and voice of the credit union, but is then hyper-targeted and personalized to the audience that we're engaging, right? So back to your 18 to 24 year olds wanna be a different communication strategy than the baby boomers and the Gen Xers. And so can we create versions of the message that's more targeted to those audiences. Or it could be, again, around a branch, right? We know all the people associated with a branch. We can make it branch specific to your neighborhood and use that language. So again, Virtus Compose is the next piece of our offering that will take a campaign that says, we wanna bring this checking account to this to the masses or to our audience. But now we can create many versions of that marketing copy for the campaign that's very specific to these hyper personalized micro segments that we want to engage so that's the next piece of this to you know really answer i think the the question or the challenge that you've put forth which is okay great we want to have audiences of you know hundreds or thousands of members but if i now have to have 20 different audiences how do i um write uh you know a marketing piece of collateral that meets these 20 different views. And that's what we're trying to solve with Virtus Compose is doing that at scale, leveraging the power of AI.
SPEAKER_03:I assume that product would be optional for users of Acquire? Yes, for sure. I mean, some credit unions with large staffs would say, heck, we can do this ourselves.
SPEAKER_04:For sure. And as well, we hear they also have agencies, right? There's many great marketing agencies out there that do this on behalf of them. And so we're not trying to necessarily cannibalize that, but we want to provide a way to at scale generate multiple versions of copy that could help tell the story that's much more personalized and focused on the audience.
SPEAKER_00:And that's our experience is that we do utilize an agency and we feel already really comfortable with our current process of putting out copy in content. But my experience personally is that I've worked at a couple of different credit unions and financial institutions. And you may have been alluding to this, but credit unions, I think, particularly the smaller shops are When it comes to marketing, they may have somebody doing marketing that's also doing, has two other hats on. And so when it comes to this composed tool that Virtus is offering, I think that that is really going to be essential in these micro campaigns, or even it could become essential in their bigger campaigns as well. But it is what's going to help make it possible, particularly for those smaller shops.
SPEAKER_03:Yeah, I just see a lot of credit unions struggling. You say, okay, fine. Now you're going to have to create six different messages for six different demographics. And I see them saying, whoa, that's a lot. That's a lot of creating. And it's not because they're not intelligent people. It's that there's not a lot of staff ready to dive in on this problem.
SPEAKER_04:But it's such a great use case for this age of AI that we live in, Robert. I mean, we're hearing so much about this and people are trying to understand what are the use case and the opportunities for it. And we think this is just the natural progression of our value case for credit unions, which is data-driven personalization. That's great. So I can find these smaller audiences that show high propensity for different products and services. Now I need to reach them. So how do I reach them? OK, I need to engage them with some sort of compelling message or content. OK, how do I do that at scale with a limited staff? And that's why we release Compose as the natural progression of how do I engage my existing members? How do I find the best long term prospective members to grow my membership? And then how do I engage them? So that's the journey that we've been on to support the movement.
SPEAKER_03:Now, Mitch, I'm going to come back to you in a minute. You're going to answer my cost question, which I haven't forgotten. But I want to hear from education. How and when will you decide that Acquire is successful for you? Both how and when? What kind of timetable are you looking at? And what kind of decision process are you going to use?
SPEAKER_00:I would certainly say that I'm already seeing the success from it. And I think that it can certainly be an ongoing measurement that we can continue to track, engage and say, yes, this campaign is successful or this one is not. But I think if nothing else, the particular insights that it gives us of our target audience, there's a lot of value in that too. So obviously we are hoping to to bottom line, grab additional accounts and loans that are profitable and meaningful. But there's certainly a lot of value in understanding our member mountain and our member demographics and just the transactional history and analysis that comes with that.
SPEAKER_03:I think you'll probably find that quite a few micro campaigns are not successful. And that's no big deal. What is a big deal is when you persist in doing something that's not working over and over again. I mean, Amazon kills things like in a heartbeat. It's like, boom, that's not working, dead. You use the data and you say, hmm, data says this isn't working. Let's just kill it. Speaking
SPEAKER_06:to that, data, Robert, and kind of what was mentioned a little bit there. Tiffany's done a phenomenal job at not just looking into the Virtus solution to measure the success or the lack thereof, but looking at a lot of our other metrics that we measure through the marketing world and just looking at the interaction with the results, the other pieces that we have there. So a big part of the how is completely outside of the Virtus solution and measuring the impact and solution with that. But as far as the when on it, I can tell you we're not going to be as quick to kill something, especially like this, as Amazon is. We don't have nearly as many options as they do. But also, there's a lot more to take in. So I can't give you a date, but I can tell you we won't be near as quick as Amazon to do that.
SPEAKER_03:Well, understandably. But at some point, you're going to have to make a decision. Absolutely. And obviously, it's going to be data-driven.
SPEAKER_04:I think, Robert, I just want to make one more comment about that statement that you said, which is we are big believers in this test and learn approach. And that's what we're trying to empower Tiffany and team and Bradley and team to do, which is how do we quickly surmise if this program is working and maybe not kill it, but pivot it? And pivot could be, do we have the right message, the right tactics that we're engaging, the right product? And if I can, and as Tiffany alluded to earlier, if we can show every week that, hey, this campaign that we're running is having good impacts with this demographic group or around this branch, but it's not doing as well against this branch, well, now we can make adjustments, right? So not everything's gonna work, we know that, but if we can give them the feedback loop efficiently so that they can make pivots and say, we're gonna either change the message here, or maybe we need to do more education at this particular branch, or we could just recognize that a particular branch is in a much more competitive market, and we accept that that's the realities of that branch, Just giving them that feedback loop is a really, we think, powerful value proposition for Virtus for new member acquisition, as well as for just the existing member growth. So that's a big part of what we're trying to bring to them.
SPEAKER_03:Now, so how do you see the costs?
SPEAKER_04:So our solution is a subscription model for the Virtus solution. Virtus Acquire is an add-on to that that allows them to, again, model these target audiences. We're, again, different than others in that we are, you know, they get a... a subscription to the solution and they can run as many campaigns as they want to. There is some variable cost around the number of prospects that they want to target, but it's important that where we're different is that we are helping you identify the who, the what, and the how you should engage prospects and members. There's still a an execution aspect that that is not currently something that we do. So, you know, you have to actually do the direct mail piece or do the digital outreach to those prospects. And that is still something that either the credit union does on their own or through their existing marketing partnership. So our subscription scales based on the size of the credit union. You know, again, we have credit unions, smallest 30 million in assets on the platform and approaching six billion in assets. So the solution scales for credit unions of all sizes for both existing member and new member growth.
SPEAKER_03:And with Compose, you're trying to plug up a possible weak point, which is some credit unions just probably wouldn't be very good and don't have existing vendor relationships that would create good campaigns. That's correct.
UNKNOWN:Yeah.
SPEAKER_03:So that's clever on your part. And as we said, it's not mandatory. But you say, no, we're happy with what we
SPEAKER_06:do. Mitch might shoot me for this one because I might be pushing Compose a little outside of what it was intended to be. But I would love to see that be more than just a replacement for a shop that doesn't have the capability internally or the third party relationship to generate that. But to also be kind of just... A part of that ability to react quicker, to have something that's immediately generated. And it might be something, hey, take a look at it. We've got a great internal team. And they're going to say, this is crud. This is terrible. This is great. And take that one piece. It's still got us going quicker. than if we would have had to think that up off the fly. And the more of those micro campaigns you generate, the more you do those sort of things, it's just something that can help with speed and not just replacement of those functions.
SPEAKER_04:That's great feedback, Bradley. And I think that is, you are spot on. The vision of Furtis Compose is really to just be, you know, call it the co-pilot for your marketing team on this content, not necessarily a replacement, which is, let me give you eight or 10 versions and you can decide, I like this, I don't like this, combine these pieces, right? It's the, you know, swipe left, swipe right on content to get to what is something we can, you know, more efficiently get out into the next member communication, the next member engagement. So that's great feedback and, and we, you know, we'll definitely be taking more from you over the, over the coming months and years.
SPEAKER_06:Did you just compare Virtus to an online dating app? No, just, just,
SPEAKER_04:just the function of how do I get to good, good answers quickly, right?
SPEAKER_03:Before we go think hard. about how you can help support this podcast so we can do more interviews with more thoughtful leaders in the credit union world. What we're trying to figure out here in these podcasts is what's next for credit unions. What can they do to really, really, really make a difference in the financial scene? Can't all be mega banks, can it? It's my hope it won't all be mega banks. It'll always be a place for credit unions. That's what we're discussing here. So figure out how you can help. Get in touch with me. This is rjmcgarvey at gmail.com. Robert McGarvey again. That's rjmcgarvey at gmail.com. Get in touch. We'll figure out a way that you can help. We need your support. We want your support. We thank you for your support. The CU2.0 Podcast.