Taking on Teenagers

thePoint
July 22, 2005

Already numbering more than 28 million, teenagers—young people from 13 to 19—are one of the fastest-growing population segments, according to 2000 U.S. Census data, reports Credit Union Management magazine. Couple this with teens' stunning amounts of disposable funds and their seemingly insatiable appetite for technology, fashion, and music, and it's no surprise that many businesses, including credit unions, are wooing them.

Tara McQuillen, director of marketing at $50 million/7,500member Bellco Federal Credit Union in Wyomissing, Pennsylvania, says her credit union is on a teen marketing journey.

Marketing to teens is a journey because establishing an overall teen marketing program may take board approval, plus time to develop, support, and market products. Indeed, marketing to teens is much more than a simple promotion.

Bellco FCU's marketing goals reflect the multi-faceted teen marketplace:

• Educating members about the importance of teaching their children about saving and spending money
• Promoting full family membership and encouraging members to make their children credit union members
• Educating teens about the benefits of Bellco FCU compared to other financial institutions

McQuillen notes that Bellco FCU launched a "Main Street" program for members ages 13 to 18, offering an educational information packet, a quarterly newsletter, and an interactive website to help teens learn about money and credit.

In the first year of the program, membership in this age range saw a net increase of 108 members. In contrast, the credit union gained 19 new members in this age range the year before the program. Bellco FCU's overall teen/youth marketing campaign has helped reduce the average Bellco FCU member age from 46 to 42 in two years.

Functioning as a type of focus group, the credit union's youth advisory board is a group of 8 to 12 members, ages 9 to 18 years old. Board members discuss their personal financial needs and how Bellco FCU can meet them. The board meets every other month on Sunday afternoons. The agenda includes a brief educational seminar about a financial topic chosen by board members.

Already, the board's input, such as that they disliked how other financial institutions charged fees for debit cards, has helped shape Bellco FCU's introduction of a no-fee Visa Buxx card (a prepaid card, not a credit card, that can be used everywhere a Visa debit card is accepted). While any member can get a Buxx card, the product is targeted to teens, promoting their independence and eliminating the need for them to carry cash.

Bellco FCU also bolsters its "Main Street" program by providing guest speakers for high school classes about the importance of saving money and maintaining good credit. Further, McQuillen suggests employing high school and college student summer interns as a means to connect with this market.

The good news is that the price tag for a program doesn't have to be extravagant to be successful, McQuillen notes. The cost for Bellco FCU's "Main Street" (with its slogan of "Financial Services and Guidance for Young Adults") and "Busy Bees," (for ages 0 to 12) programs is about $7,000 per year. This includes membership fees, sponsorships, the newsletter, and educational materials.

McQuillen emphasizes that youth and teen marketing is a long-term endeavor. Therefore, board approval and senior management support are critical to the success. She adds, "Be consistent. Deliver what you promise. And don't start a program and then slack off."

Teen Teams

Recognizing the role of teachers confirms that marketing to teens involves marketing to teams. "One of our goals is to jointly help teens and parents," says Sheryl Cox, marketing director for $2.8 billion/347,000member America First Credit Union, Riverdale, Utah. For example, the credit union offers a "Fundz" debit card designed to provide access to funds without a revolving line of credit. Some say jokingly that it's a "credit card with training wheels."

Fundz, explains Cox, is set up by opening a checking account that's dedicated to the card. The Fundz card, available to members of all ages but targeted to those 12 and above, has the same benefits of a standard Visa debit card, including security features.

"We want parents and teens to talk and work together to learn about managing financial matters," says Cox. "Through focus groups conducted for this product, we learned that parents liked the option of controlling the amount of money that's available on the card. In response, we added a register for the card that helps users record transactions. From teens, we heard concerns about keeping cash in lockers. Also, some find a checkbook a hassle. The focus groups confirmed that teens thought our bright green card would look cool in their wallets."

In the focus groups, teens said they learn little about personal finance in school, want help with money matters, and accept responsibility for how they manage their money.

In addition to the Fundz card, Cox notes, America First CU is planning an educationally oriented youth website to talk with teens in their language using a medium many of them use. Complementing these, she adds, are the in-person educational efforts of Joyce Swaner, the credit union's "youth outreach coordinator." Swaner, who has been in her position for two years, not only visits schools, but also works internally to help staff prepare to make presentations in the community.

"When we talk to young people about being smart money managers, we urge them to comparison shop for financial products and consider options," says Swaner. "As a presenter, it's important to be confident that your organization is offering the best products for members.

America First CU's involvement in teen literacy education will increase since Utah now has a law requiring high school seniors to pass a personal finance class before graduating. Many teachers are not prepared to teach this. Hence, Swaner notes that the credit union will be helping to train teachers on how to teach financial literacy concepts plus providing curriculum.

This article was prepared by the staff at the Point for Credit Union Research and Advice and is published online at http://thepoint.cuna.org/. Reprinted with permission.