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5 Things You Should Know About Credit Union Marketing Budgets

The Financial Brand looked at the marketing budgets for the 100 biggest credit unions in the U.S., revealing a number of insights that will surprise anyone in the banking industry.

Note: All data based on NCUA 5300 call reports.

Average Asset Size: $3.9 billion
Median Asset Size: $2.6 billion
#1 by Assets: Navy Federal ($48.0 billion)
#100 by Assets: Connecticut State Employees ($1.6 billion)

Subscribe TodayAverage Membership: 284,985
Median Membership: 200,426
#1 by Members: Navy Federal (3.9 million members, $48.0 billion assets)
#100 by Members: Melrose (24,285 members, $1.7 billion assets)

Average Marketing Budget: $3.9 million
Median Marketing Budget: $2.6 million
Average % of Assets Allocated to Marketing: 0.10%
Median % of Assets Allocated to Marketing: 0.10%

Average Marketing Dollars Allocated Per Member: $13.81
Median Marketing Dollars Allocated Per Member: $13.00
Most Marketing Dollars Allocated Per Member: Melrose ($203)
Least Marketing Dollars Allocated Per Member: State Farm (5¢)
Average Member Growth: 5.16%
Median Member Growth: 4.81%
Average Marketing Investment Per Net New Member: $281.48
Median Marketing Investment Per Net New Member: $223.00

Average Marketing Investment Per Branch: $190,954
Median Marketing Investment Per Branch: $102,278
Most Marketing Dollars Allocated Per Branch: Melrose ($4.9 million, 1 branch)
Least Marketing Dollars Allocated Per Branch: State Farm ($283, 24 branches)

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1.) Credit unions spend more on marketing than you think.

Credit unions were once seen as a quaint, sleepy little corner of the financial industry. Not anymore. The top 10 credit unions invest $155 million annually on marketing, and the top 100 credit unions spend a combined $400 million on advertising and related educational expenses. Not many years ago, there weren’t many marketing vendors specifically targeting credit unions. It’s not hard to see why the credit union marketing business is no longer seen as a “cottage industry.” There’s some serious money at stake here. The Financial Brand estimates that the amount America’s 7,000+ credit unions invest in marketing annually flirts around the $1 billion mark. Still, that’s small potatoes compared to the estimated $2 billion BofA alone spends on marketing every year.

Assets Mktg. Budget % of
to Mktg.
$ Per
$ Per
Net New
Navy $48.0B $77.0M 0.16% $20 8.83% 6.27% $333
Pentagon $15.1B $14.1M 0.09% $13 0.35% 6.99% $199
BECU $10.6B $13.0M 0.12% $17 10.39% 11.25% $168
Suncoast Schools $5.1B $11.3M 0.22% $21 2.24% 5.16% $434
Municipal $1.8B $7.1M 0.39% $21 6.88% 2.92% $733
San Diego County $5.7B $6.6M 0.12% $29 11.31% 7.59% $406
Mountain America $3.2B $6.6M 0.21% $17 9.71% 7.72% $241
The Golden 1 $7.8B $6.6M 0.08% $11 -0.29% 2.86% $385
Security Service $6.7B $6.4M 0.10% $7 3.54% 4.51% $169
American Airlines $5.5B $6.0M 0.11% $26 4.05% 2.97% $897

[top spenders]

2.) Some very large credit unions spend almost nothing on marketing.

All the credit unions in The Financial Brand’s study had assets in excess of $1.6 million, meaning they should typically have a marketing budget of at least $1 million. However ten of the credit unions in the study spent less than that in 2012. Merck Employees FCU’s marketing budget was only $124,961 last year, and APCO Employees was just a little bit more.

State Farm FCU ($3.8 billion in assets, 130,000 members) spent only $6,793 on marketing and advertising in all of 2012. Despite this, the credit union managed to grow assets by 3.08% and loans by 1.17%… but they also lost over 2,000 members in the process.

Similarly, Connecticut State Employees Credit Union ($1.6 billion in assets, 70,000 members) invested a paltry $14,697 on marketing last year. They eked out 2.50% asset growth, but an impressive 12.94% increase in loans. Unfortunately they lost 1,146 members along the way.

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3.) Some credit unions are marketing extremely aggressively.

Normally, a credit union with $2 billion in assets would have a marketing budget around $2 million dollars. But there are a number of credit unions in the neighborhood of $2 billion spending over $4 million on marketing — more than twice as much as would be expected.

Municipal Credit Union tops the list. With a marketing budget that crests $7.1 million dollars, this $1.8 billion institution is spending nearly four times the normal amount on advertising. And Grow Financial spent $4 million for net member growth of -1.

Among these aggressive credit unions, the average marketing cost per net new member is substantially higher than average: over $1,000 vs. $281.

Assets Mktg.
% of
to Mktg.
Asset Growth Member Growth Mktg. $
Net New
Municipal $1.8B $7.1M 0.39% $21 6.88% 2.92% $733
Melrose $1.7B $4.9M 0.29% $203 17.20% 5.14% $4,148
Georgia’s Own $1.7B $4.6M 0.26% $24 3.67% 11.15% $244
CommunityAmerica $1.9B $5.0M 0.26% $29 6.71% 1.77% $1,684
MidFlorida $1.7B $4.2M 0.25% $27 5.86% 5.31% $534
Grow Financial $1.8B $4.0M 0.22% $26 5.51% 0.00% N/A
Suncoast Schools $5.1B $11.2M 0.22% $21 2.24% 5.16% $434
Founders $1.7B $3.6M 0.22% $19 4.47% 1.07% $1,788
Citadel $1.8B $3.9M 0.21% $29 16.80% 7.77% $398
MSU $2.3B $4.7M 0.21% $28 10.11% 5.33% $557

4.) Some credit unions are spending thousands of dollars for every new member.

The average large credit union added around 14,000 net new members last year, spending $281 per net new member on marketing. However, there are credit unions spending thousands of dollars just to pick up a few new members.

Western FCU, with $1.7 billion in assets and 154,000 members, had a marketing budget of over $3 million dollars in 2012 but only netted 105 new members at an average cost of just over $30,000 each. Melrose Credit Union paid over $4,000 per net new member, adding 1,187 to its 24,000 members (5.14% growth). But based on Melrose Credit Union’s highly lucrative audience, this may well be worth it.

Most Marketing
Dollars Per
New Member
Members Net New
Mktg. $
Per Net New
Western $3,173,556 154,231 105 0.07% $30,224
Melrose $4,924,108 24,285 1,187 5.14% $4,148
Atlanta Postal $888,343 100,232 443 0.44% $2,005
Founders $3,568,328 189,375 1,996 1.07% $1,788
San Antonio $2,455,297 255,511 1,402 0.55% $1,751
CommunityAmerica $4,966,969 169,631 2,950 1.77% $1,684
California Coast $1,796,617 118,507 1,707 1.46% $1,052
Patelco $1,352,226 273,013 1,484 0.55% $911
American Airlines $6,023,159 232,948 6,712 2.97% $897
Citizens Equity $4,980,944 287,962 6,088 2.16% $818
MARQUIS | TriggerPro

5.) Credit unions that invest more marketing dollars per member see larger membership growth, asset growth and loan growth.

In The Financial Brand’s study, there was no stronger correlation between two variables than “Membership Growth” and “Average Marketing Dollars Allocated Per Member.” Those that invested less than $10 per member saw net negative membership growth of -3.90%. But those credit unions allocating slightly more than $15 per member enjoyed membership growth hovering around +15%.

Mktg. Spend
Per Net
New Member
$ Per
% of
to Mktg.
$ Per
Over 10% Member Growth $16.78 14.85% 0.12% $144,564 12.67% 8.16%
Member Growth Between 5% and 10% $14.94 6.52% 0.11% $153,66 8.52% 3.21%
Member Growth Between 0% and 5% $12.09 2.97% 0.09% $107,488 6.20% 1.99%
Negative Member Growth $9.59 -3.90% 0.07% $71,863 6.56% -0.36%

Look at the chart below and you’ll see that most credit unions budgeting $15 or more to marketing per member saw member growth exceed +5%.



What Are Your Questions About Credit Union Marketing Budgets

The Financial Brand is happy to answer your questions. We have a lot of data, so tell us what you want to know. Leave a comment below, and we’ll try our best to dig through the research and find an answer for you.

All content © 2017 by The Financial Brand and may not be reproduced by any means without permission.

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  1. Diva Deb says:

    RE: #2 – some very large credit unions put actual marketing/advertising costs under “Member Education” and then claim they don’t do any marketing…….

    just so you know 🙂

  2. Are those year-end total asset numbers? NAVY FEDERAL CREDIT UNION is $52.4B, not $48.0B. Did you make some sort of adjustment?

  3. Deb, there is one line item in NCUA 5300 call reports that combines both. Page 5, item #23: “Educational and Promotional Expenses.”

  4. John, The Financial Brand pulls spreadsheets used for asset, loan, share and member growth in the middle of every year (these spreadsheets are used throughout the year for multiple analyses). So the numbers are comparing mid-year 2012 to mid-year 2011. The marketing budgets, however, were pulled from year-end call reports.

  5. Do these budgets include salaries? internal technology investments? ECM systems for marketing communications, etc?
    Is there a breakdown based on those who are more traditional adv-driven vs “alternative/digital” adv, those who blend equally and those who spend primarily on digital adv only?

    Just interested in how marketing “budgets” and dollars are moving towards the digital transformation, leaner staffing models, and enterprise tech systems that mktg/tech/hr.

  6. Good questions Lisa. There is no breakdown of how marketing dollars are allocated in the 5300 call reports. It’s just one big lump sum. I’m almost 100% positive that no salaries are included in that number; I’m pretty sure payroll expenses are reported elsewhere in the ledger.

  7. An excellent piece; very interesting and informative thank you. It does need smoothing over a number of years to give a fuller picture if the numbers are based on one year. I suspect that credit unions will spend marketing money on an adhoc basis and quite stop start so looking forward to a 3 year trend piece.

  8. Devon Kinkead says:

    When you say “In The Financial Brand’s study, there was no stronger correlation between two variables than “Membership Growth” and “Average Marketing Dollars Allocated Per Member.” What statistical technique did you use and what did the numbers look like? Can you share the spreadsheet for further analysis?

  9. Devon,

    Because financial institutions of varying sizes will have varying marketing budgets, there are three ways to equalize marketing spend:

    – % of assets allocated to marketing
    – marketing $ allocated per member
    – marketing $ allocated per branch

    This creates a set of 3 variables that can be used to assess:

    – asset growth
    – member growth
    – loan growth
    – deposit growth

    Other datapoints were also considered, such as net branch growth and marketing $ per net new member.

    Multiple tools were used to compare the data for these two axes (charts, clusters, heat maps, etc.). I also had my friend and seasoned analyst Ron Shevlin take a look at the data because I couldn’t believe there weren’t more/stronger correlations. He agreed there were not any further material connections than member growth and avg. marketing dollars allocated per member.

    The spreadsheet took a considerable amount of time to compile, so I can’t give it away for free. But if it’s worth some money to you, please send me an email.

  10. Hello –

    How close are you to compiling these numbers for FY2013? They’re a terrific benchmark during budget time.


  11. Soon. Hopefully by the end of September.

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