How Can Credit Unions Maintain Member Experience Through Digital Banking? CEO of Pulsate Sarah Martin Provides Insight at GAC

Banking was evolving toward digital until the pandemic pushed it full force into a frictionless essential. People of all generations shifted from banking at a branch in person to digital banking to conduct their financial business.

But, a screen on its own can’t provide the same experience as one would get from sitting down and talking to a real person. At GAC 2024, our Co-founder/Publisher/Editor Sarah Snell Cooke spoke with Pulsate CEO Sarah Martin to discuss the growth of digital banking and what that means for keeping that personal connection throughout the member experience, regardless of the platform

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Sarah Cooke 00:00

All right. Welcome to The Credit Union Connection. I'm here with Sarah from Pulsate. She's going to talk a little bit about mobile banking, among other things, and why don't you just start out introducing yourself. Thank

Sarah Martin 00:14

you, Sarah. Lovely to meet you. Very handy that your name is Sarah. I'm Sarah Martin CEO of Pulsate. I'm actually Irish. I noticed. Sorry, if you might need subtitles. But um, yes, I still live in Ireland, but we serve almost 270 financial institutions here in the United States with our with our product and technology and always growing, which is great. And hopefully, that by giving the credit union the ability to engage with our members digitally, I'm just making sure that their members think of them when they have that financial need, and not somebody else, not the other guy, and definitely not good. So we are, by giving our customers the tools and strategies, they need to deepen that relationship within digital banking that's been lost, as well as the capabilities to cut through on that moment of need, when they have a financial need, and bringing them into digital banking to take care of that, of that with with the, with the credit union, rather than going down all the rates,

Sarah Cooke 01:22

right? Yeah, no. And, you know, I obviously, COVID changed everything I hate saying it, because you hear it all the time. But you really did, right? Like we needed that kick in the pants to like, go more digital. So I mean, that really accelerated the digital evolution more to a revolution issue, slower revolution. But I'm gonna talk a little bit about that. Because, you know, we were just talking before we started recording about, you know, I am somebody who logs into banking almost every day, and, you may not but you know, that is it's definitely something that people of all ages, I'm not exactly Gen Z, you know, people of all ages are doing so like that, that evolution and revolution has kind of been fascinating to watch.

Sarah Martin 02:09

Yeah, it sure has, because actually, probably 10, 15 years of consumer behavior or change occurred within that two or three months of the pandemic within banking, because it was still primarily branch-based banking, in terms of profitability, share of wallets, etc. And um, very, very quickly consumers just were not able to go to the branch anymore. So they had to serve themselves more remotely or self serve. And actually the beginning of the pandemic, we had like four, maybe five FIs using Pulsate. And by the end of the pandemic with more than 100, because they didn't, they needed and they still do, they needed the tools to be able to proactively communicate and engage with their members, even though they're not going to the branch anymore. And now, you know, case study, early last released early last year, just 10% of American consumers actually want to go back to a branch, right? More than that do go to the branch, but you can tell 90% of all of those opportunities that were created at the branch are at risk of being lost, which is crisis level, like there has to be an urgency around resolving the ability to create relationships with your members, when they're not coming to the branch. Yeah, because that's 90% of all opportunities that can be lost. And that's our passion of everything we do at Pulsate is about giving the credit union the ability to be top of mind and their own members, find a moment of financial needs, and just cutting through and making sure the member is also better able to manage their own finances. We have, there are credit unions, or there are consumers out there with like products that six or seven different financial institutions, they can't keep control of their own finances anymore. So there's a there's an urgency to give members back the ability to have things in one central location as well. So there's a lot of what we do that brings that member in, so that they're being served, and not just Oh, get a loan or get a deposit. Like that's the last thing that our customers are doing with Pulsate. They are doing it and they're good at be very successful with it, but they're being picky about it. And um, being very targeted and relevant to the member. So we see what we try what we do is we give the credit unions the ability to engage and make sure that their members are using all of the amazing products and services that are available within digital banking via anti- fraud solutions, card controls, making sure that they're utilizing e-statements, If there's a credit score available that they know about and they're using it and that's all about deepening the engagements and the stickiness and being so much more top of mind when they have a financial need because they have this deeper relationship digitally. And then Pulsate is also identifying if there's a moment of need, financial need, just cutting through in that moment to let them say, Hey, Sarah, don't forget, you are pre approved for $35,000 with us. Click here to accept. And when they click on that notification, or communication, they're brought to exactly the location within digital banking to take that action. So not like being left in a different app, which is an email app or in another app, which is an SMS app, but actually directly within digital banking, and taking that action, which is obviously great for the member because they get to follow up. But also if they get distracted, and then they don't, they don't take that application, or they don't finish it. Because life gets in the way, Pulsate's in there just like nudging them back in to complete that action, which is a really important aspect. Because I think the latest stats I read was 83% of applications are abandoned, at least Yeah. Because you know, you've had it yourself, and then you start you don't finish. It's like, Where was that? How did I get there? So Pulsate's just resolving that and just helping the member to self serve. And get them to to Yeah, the products they need. Yeah.

Sarah Cooke 06:13
So like, and it's interesting, because they're, that evolution, like fortunately, unfortunately, I'm old enough to have watched a lot of. So, yeah, I mean, like the credit union where I am the volunteer at. We were the first ones to have online banking in the country. First credit union, what was the credit union? It's called APL Federal Credit Union. Yeah. And so from you go from there to where like, I was talking to a credit union CEO, probably 10 years ago now. But yeah, about remote deposit capture. And people didn't know what, they were like the first ones to try this. And you people were sending pictures of their cats and stuff. And then, you know. So to today, where you know, and again, probably 10, 15 years ago, everybody's talking about aggregation. Nobody knew how to use aggregation. And the technology has just come along. And of course, which driven has driven the price down makes it much easier to have those those data lakes? So, yeah, I mean, you've watched technology evolve. Yeah, like, and it's done. I mean, yes, it's affected banking. But to your point, it has affected everybody's daily lives. We couldn't imagine applying for a loan online when I was in college, like it didn't exist.

Sarah Martin 07:40

Big sell for many consumers today, they still can't imagine, but it is coming. There's no, there's no doubt about it. And, you know, often I talk to credit union leaders who are like, Oh, but my members, you know, they skew slightly older. My mom is touching. I'm not gonna say her age in case she watches this. But you know, she's doing all of her banking online, and there's no stopping her. Like she basically can do Facebook, and digital banking. There's really, all you need. There is no stone, no stone that's not unturned, but it's with this transformation of the industry. And yeah, I think it's, it's so important that we can bring that ethos of the relationship and the community into digital banking, because that's what makes this midland want like so wonderful, yes, I don't want to lose that we don't want to lose that we should not be allowing that to be lost. So if we can make even just a small difference there to give credit unions, the ability to establish that relationship and deepen that relationship. I will work night, in the morning to make sure that that's possible. I know my team do as well.

Sarah Cooke 08:50

Yeah, no transferring that personal experience online or on your phone, whatever. It's, it's challenging. It's not you got a flat two dimensional screen there in front of you, as opposed to like being face to face like this. But so yeah, I love I love that idea that of personalization. Yeah. And it's so popular to just, that's how you digitally make people feel special. Right? Yeah. As opposed to using your name Sarah, over and over.

Sarah Martin 09:21

I was just going to say that is not personalization. Do not let anybody say that your name is in the email. No, personalize is when Sarah has a financial need for an auto loan, that Sarah receives the message to the channel she's most likely to engage with. And it's a product that she actually has an interest in. Right. So when they, I guess within the industry, credit unions right now and for no other reason other than that's what's available to them sending their customers email after email after email about everything and anything that's important to the credit union. Right? Yeah. Right? And we're really about turning that around. So communicating less with Sarah, the member, the better, but only really touching on the things that are relevant. Yes. Like, if Sarah already has the app, do not send her an email telling her to download the app, because that's just not relevant. The app, then you want to maybe tell her about the benefits of setting up direct deposits? All right? How, you know, maybe Sarah doesn't realize that there's a great rewards program associated with your card. Encourage her to activate that card and get using it. Add it to the digital wallet, which is an important, another huge behavioral change. These are the things you want to be able to do because you're, you want to give your members a convenient, useful service. You're not there to babysit their kids, right? It's financial. They're in digital banking, they're thinking about banking, so serve them around that and making their financial health better. And I think that's so important to bring it back to the relevancy because you as a bank, you know, your banking entity or financial institution, it's still about the financial health of your members. Not necessarily about I don't know. I can't think of anything. Yeah, Relevancy is so important. Your members don't want to know about something irrelevant to banking from you. They don't, that's not what you're there for.

Sarah Cooke 11:38

Right? Yeah. And, I mean, and, you know, like, you can see, or you notice, I'm, I'm sometimes at a car dealership more frequently than, you know, I might be or say my car loan is four years old. So it's either time to get a new car, or maybe even refinance, or so having those timely offers not so

Sarah Martin 12:00

important. And like we, obviously, well, so the role of what we call that rollover campaigns is making sure that we're nudging those, even actually, two years is the sweet spot, really for auto just to start, like, seeding then and then not in an obnoxious way, but like, really, you know, certainly supporting. But last year, we had in the industry, a lot of credit unions do a huge push for CDs, which it was really important to lock down those deposits, right, because there was a moment there were not enough. So liquidity was was, you know, and still is a massive necessity for the industry and an urgency around last. So last year, our customers were driving to CDs. And it was you know, in the early days, we were learning as well, right deposits for it wasn't a common thing for quite a while. So moving easing Pulsate to encourage members to sign up for CDs. Now what we have, we had one customer growth, less than a billion dollars, they got 21 million incremental, incremental deposits, freezing cold season, a huge portion of that was CDs. But right now, that same credit union and other credit unions just like them, they'll see these are going to expire, suppose it's in there just automatically encouraging them to extend or re... We call that rollover campaigns. And that's so important right this minute. But also, when it comes to deposits, what we're, we've been really supporting our customers just to be a bit more cognizant of profitability. So targeting, when it comes to the product, to deposits and profitability is absolutely key. If you offer a high value deposit product to all of your members, you're gonna go broke, you're hitting your profitability, and it did happen and there was a reason for it. So stick to your objectives. Like last year, there was an urgency to keep those deposits, but now there's just we are working with our customers just to be much more targeted. So identify those members who don't have a deposit with you, right. And the data is there and encourage them to sign up for the high value CD. So therefore balancing the profitability of their portfolio. And that's been much smaller numbers, but much better for the overall financial performance of the credit union.

Sarah Cooke 14:23
right. Yeah, no, and I'd profitability at one point you didn't say that among credit unions, because we're not for profits, but you need to keep

Sarah Martin 14:31
the lights on. And that's how you serve more members.

Sarah Cooke 14:35
is how you serve them or how

Sarah Martin 14:37
you get and you reach more and you can do more for more members. It's not about, it isn't about profit because it isn't not for profit, or

Sarah Cooke 14:47
movement, but it's the mission that's different. The philosophies

Sarah Martin 14:51

You have to have that growth in order to continue your mission and expand the Yeah, and the mission is such a great word like to expand your reach for with that great value that they're creating for their communities.

Sarah Cooke 15:05
Well, Sarah, I'm gonna let you have the final word. Any final thoughts as we wrap this up today?

Sarah Martin 15:10

Have loads of thoughts. This is wonderful to be back at GAC. I am there's such a period of not being able to call. And so I this is like my favorite conference of the year I get to meet so many of our amazing customers and partners and future friends. And it's been an absolute pleasure to meet you today, Sarah, and thank you so much for the opportunity. We are going to continue to serve as many credit unions as possible and help them to be successful in this mobile first banking environment. Great, awesome. Thank you. Thank you, Sarah.