What are free socks and why would you want to give them to your members?
Free socks are a symbol for filling a member’s need before they even know they have one. The “Free Socks" reference originate from an example in the fitness/health industry.
In this space, many companies are using apps as the ultimate engagement tool. A user selects a fitness app to achieve a specific goal. For the purpose of this example, it will be to finishing a 15K race. The information collected on the app includes: street address and zip, age, weight, goal, running route data, running shoe (make, model and purchase date) and music.
The app manufacturer will gather the following insight on the user, including but not limited to;demographic and psychographic profiles associated to the zip, age and possibly music selection. age, weight and goal are attributed to health indication and improvement. route data, type of running shoe, and shoe purchase date give incredible product use information that may be for a competitor as well as their own product.
After sixth months of using the app, the user is sent a free pair of $12 running-specific socks produced by the fitness company that owns the app. Included is a note that informs the user that based on the amount they have run, it is time for new socks. The socks are the lowest entry point into the fitness company’s product line, so the company includes a coupon for $25 off my next purchase and free shipping available on purchases $49 or more.
The app becomes the conduit of the data collected. The fitness company engaged with a product after looking at the user profile, propensity to buy as well as engage with the brand. The personalization in messaging and low entry to the product line, make the adoption flight risk relatively low.
Simply put, the fitness company provided a valuable item to the user before the user even knew they needed it.
What do free socks look like in the credit union space?
On a very simple level, member’s needs surround their money, how to get more and get more from what they currently have.
Here are a few “Free Sock” examples identified by THRIVE clients.
1. Making charity donations with reward point programs.
In addition to offering travel reward program on their credit cards, one credit union identified that card users were also frequent donors to local charities. This option for members to redeem their accumulated points for donations to charity not only adds value to member and the charity, but also makes this reward program unique.
2.Offering triple points on retailers the members actually and frequently use.
In reviewing member purchase behavior, one credit union identified several retailers their card members were frequently purchasing from using the retailer card and not the credit union credit card. In creating promotions around purchases at these retailers, the member gets additional value from the credit union credit card, increases either their use or spend and credit union benefits in the uplift in interchange income.
3. Adding value to member auto relationship.
Members have a daily relationship with their auto as it the primary mode of transportation. Credit unions hold much information on their member’s autos. A credit union can identify when an auto may need repairs as well as when insurance and registration due. Helping the member find the best price for repairs as well as saving for the financial Impact of big ticket repairs are prime examples of “Free Socks.”
How can credit unions create free socks?
Credit unions have robust amounts of data available that can be connected to create deep member insights. With this new, member perspective, credit unions can create predictive and prescriptive product offerings that create a personalized user experience that includes trust, retention, and advocacy. Credit Unions can fill members needs before they even know they have the need.
This is powerful, value creation.