#531: Leaders in Customer Loyalty: Brand Stories | How SECU Built Trust With its Members Before Launching its Loyalty Program

For most financial institutions, launching a new rewards credit card means explaining the benefits to customers. For the North Carolina State Employees’ Credit Union (SECU), it meant starting much closer to home. 

When SECU introduced its new rewards card portfolio last year, the credit union wasn't simply adding another product. It was introducing an entirely new rewards ecosystem to members and employees who had little familiarity with reward cards. Moving from a single legacy Visa card to four distinct offerings required a significant education effort—one that began internally before extending to the membership. 

Under the leadership of Brad Moats, SVP of Card Product and Portfolio Strategy, SECU launched employee pilots, hosted virtual manager meetings, and conducted more than 100 branch district sessions to help employees understand how rewards programs work and how to communicate their value. 

Transcript

Welcome And Brand Story Setup

SPEAKER_01 0:02

Welcome back to our Leaders in Customer Loyalty Podcast. It's a Thursday, so that means another edition of our brand story. Today's conversation is going to explore how customer loyalty and financial service is evolving as members expect more personalized products and seamless digital experiences. Founded in 1937, the North Carolina State Employees Credit Union, NC SECU, has grown into the largest credit union within North Carolina and one of the largest in the country while maintaining a strong member focus. Driven by Voice of the Customer Insights, SECU has evolved its offerings to better meet the changing member needs, expanding from one credit card offering to four specialized credit card options, and soon to launch an enhanced digital banking experience to drive deeper customer loyalty. Today we're going to hear more about SECU, how they approach customer loyalty, innovation, and member engagement in an increasingly competitive digital environment. And we're also going to learn more about actually what a credit union is. Brad Motz, the Senior Vice President of Card Product and Portfolio Strategy at NC SECU, is joining us today. Brad, how are you?

SPEAKER_00 1:16

Doing great. Nice and sunny down here in North Carolina or up here.

SPEAKER_01 1:20

That's good. That's good. Yeah. From Ohio, that'd be down there. So that's good.

NC SECU Scale And History

SPEAKER_01 1:26

First off, for those who may not be familiar, can you give us a short introduction to NCSECU and kind of what you guys do, how you do it?

SPEAKER_00 1:34

Yep, yep. Yeah. So State Employees Credit Union out of North Carolina was actually founded in back back in 1937. So over 89 years out there. We started with 17 members, $437 in deposits. Today we have over 275 branches in North Carolina, over 1,100 ATMs, 2.9 million members on the way to 3 million members, with over 59 billion in assets. So quite a bit of growth over the last 89 years. Largest credit union in North Carolina, the second in the nation. And you know, really our base, our membership is here in North Carolina. And, you know, really, you know, I think a lot of our success has come from, you know, members know and trust, SECU. That's number one thing that we hear from our members. So we're continuing to evolve, listen to our members making sure that their priority is our priority.

Credit Unions Versus Banks

SPEAKER_01 2:22

Credit unions. Everyone's heard of them, right? Uh some people are involved with them. Uh I have uh an account with a credit union, actually, too. Um what is a credit union for those who may not know? How are you different than banks? Uh how do you kind of maybe how are you similar to banks? I think that'd be good for people to know.

SPEAKER_00 2:39

Yeah, yeah. I mean, so we are a member-owned uh not-for-profit organization, right? So uh cooperative formed. Um, so we don't have the you know the stockholders, we actually have members that own the credit union. So everything we do, uh we do with our members uh you know in mind. We have to be good stewards of their money, of course, that they're investing in into the organization. And so our products are coming out with our members in mind, uh, the lower rates, uh, you know, the better pricing on products because it's their products, it's it's member owned.

SPEAKER_01 3:10

That's awesome. Yeah.

Brad’s Role In Card Strategy

SPEAKER_01 3:12

So what do you do at NC SECU? I always get they're wrong, I always try to climb it. You're trying to say that like five times fast. That's that's a lot. So what's your role? What do you what do you do on a daily basis?

SPEAKER_00 3:22

Yeah, yeah. So so uh at we can just say SECU. At SECU, uh my my role over the past four years has has really been to come in and develop a uh credit card strategy, uh product strategy. So our focus is around our our non-rewards and now our rewards cards that we launched last year. Um, you know, so uh a lot of what we're doing is is the marketing, it's it's uh the development of any kind of you know promotions, uh, it's it's the management of the plastics and you know all all the operations that come with it, the fraud and um and such, right? So uh yeah, our team uh oversees all that and we we ultimately focus on the product for the credit cards.

SPEAKER_01 3:58

Okay. Yeah. Uh when you look at your role, uh you have a pretty big remit there. You know, what is the biggest challenge and or opportunity you face in your role?

Going From One Card To Four

SPEAKER_00 4:08

Yeah. I you know, I I think one of the biggest uh challenges that we face in the role was uh especially with the reward cards, right? We were brought in from other institutions, but we were brought in to launch reward cards. So when we did that, uh we moved from one product to now four. Uh we have a legacy credit card that's out there now, um, our VISA credit card. But in doing that, we had to take the organization from one product to four. We had to introduce rewards across every single platform, every single touch point that was out there, and we had to, you know, educate folks on rewards. Uh surprising enough, a lot of our members and our employees never had reward cards, uh or they had the Costco's and other cards that were out there, but um it was the communication around it, it was making sure that they know how to use the product and also that they can you know talk it up with our membership, right? Make sure they're educated on it as well. So it was really just taking that product and multiplying it uh and just touching every single facet of SECO. Um, certainly probably one of the biggest challenges I've had um in any role I've ever had.

SPEAKER_01 5:03

Well, that's all and that's interesting. You mentioned the the training piece, very important, right? I know you guys have done uh very well uh kind of from an employee engagement perspective. How does training differ? Because you mentioned traditionally a smaller, more finite set of products you launched before. How important is getting the training right, or how important is kind of customer loyalty within the employee side, employee loyalty to the success you guys see?

SPEAKER_00 5:28

Oh, 100%. I mean, so the training had to come with, you know, uh different kind of pilots that we actually did to get the products out in our employees' hands, right? So it made a little bit made it make a lot more sense to them. But uh, you know, the training from, you know, what is a reward card? Um, how does how does it plug into the play? You've got a new loyalty program out there, how does how does that work, right? Um, and and really even the value proposition, when you go from a one single card, no rewards, to hey, you've got two percent or 1.5 here or 3x here, um, those kind those conversations get a little confusing if you've never done touched it before, right? So uh we did all kinds of virtual sessions, uh manager meetings, we were out to over 100 branches, uh district meetings, just making sure that everybody heard our message, and then we did it again and five times over that. So just making sure that we talked through every single possible channel so people got it. Excellent. Yep.

Member Expectations And Rewards Adoption

SPEAKER_01 6:18

Uh you know, you just attended the 26th Loyalty Expo, uh pretty solid conference. Uh big discussion around customers, customers changing, evolving in a kind of a myriad of industries. You know, when you look at your customers, how do you see your customers changing and you know, how are you responding back in kind?

SPEAKER_00 6:35

Yeah, yeah. I mean, uh, especially with the new rewards cards launch. I mean, you know, our our members, it was number one requested product from our membership, but they fully have embraced it, right? In fact, you know, they've said, hey, you know, do this and I'll move away from the you know XYZ credit card and set up a checking account, and we're seeing that as well. We're seeing greater deposits, we're seeing higher FICOs, we're seeing you know larger loans on the on the products because now they have a reason to spend on it, right? So um, you know, uh it it it's it's been uh very interesting to actually insert loyalty because we never had loyalty with our members other than our branches that they know and trust and they have those relationships with those folks, right? But as far as product-wise, this is truly the first product that we've had out there for loyalty.

SPEAKER_01 7:15

Okay, yeah, customer loyalty, uh launching a program, uh, very important. But uh one of the things that I love uh doing is like uh getting an understanding of kind of how you define loyalty.

Defining Loyalty As Product Growth

SPEAKER_01 7:27

So how does SECU define customer loyalty and you know what does it mean to your organization?

SPEAKER_00 7:31

Yeah. I you know, I customer loyalty for us means ultimately product multipliers, right? We're wanting to make sure that our members get the most value and they want the products, right? So if I give them a good rewards card, I give them a good mortgage with a you know a nice promotional offer or something that that's that's attached to that, right? That's going to be a product multiplier that our members are gonna want more products with us, right? From our members' perspective, and what we've heard from our members is, you know, they want to use our products very similar to what they do with other financial institutions and gain rewards, gain loyalty, uh, you know, have benefits from actually using the programs, uh card benefits, or you know, even down to the loyalty program that's out there. But we are looking at this from an enterprise loyalty perspective. We want to make sure that we're touching all facets of SECU and pulling in loyalty to all those worlds.

SPEAKER_01 8:17

Okay, excellent. Yeah, you know, you launched uh uh a new credit card program. Now you have four. Um so you talked about the FICO scores rising, kind of differentiating and diversifying the product line. You know, what does the credit card program launch uh do to help you engage with your audience?

SPEAKER_00 8:36

Yeah, yeah. Um so you know, a lot of what we've seen too is you know, from example, our cash rewards card, flat 2%. It's 1.5%, and then $500 monthly deposit, they get to 2% out of it. Um, but what we're seeing from our membership is you know, seeing larger deposits that are out there. Um so they're starting to use our checking as their primary source, right? Um also we're seeing a lot of cashbacks going back into these accounts, right? So they're using their rewards to you know put money back into their accounts, right? So we're seeing a lot more usage from our membership just in that single car product, which you know, two to one uh percent, you know, uh ratio wise, cash over points, you know, the cash is always keen. Um but yeah, I mean we're we're seeing a lot of that from our members. Um, you know, we're taking a new approach, like I said earlier, on the enterprise loyalty and how we grow these products just to be more competitive in the industry as well.

SPEAKER_01 9:22

Excellent.

Metrics That Prove Loyalty Works

SPEAKER_01 9:23

Um, you know, you look at uh measurement, very important, right, from a customer loyalty perspective. Yeah. What are some key measurements or metrics that you use to substantiate the program, to drive engagement uh upstream, right? Through the C-suite we hear all about, you know, what are a couple of most important data points or metrics when it comes to customer loyalty for your organization?

SPEAKER_00 9:46

Right. Yeah. So we went from zero to 60 when we brought the new loyalty program in because we had so much to look at, right? With point liability, making sure that we're managing that piece of it. We're also looking at you know the spend totals, we're looking at the cart sizes for our members. We're looking at, you know, we're we're very cognizant of members having a you know revolver transactor kind of experience with us, right? So are they transacting and paying off every month or are they revolving and carrying a balance, right? We work with our members on education and white papers to make sure that they're transacting to get the most from their rewards program, right? Uh we we never built off a breakage program. We want our members to redeem, right? Which is is is is kind of odd in the financial industry. You want people to use the rewards. A lot of times they don't, right? But we do, right? Because we know it's a simple enough equation where people are going to use their rewards, they're gonna come back and spend and they're gonna use the rewards again, right? And we're gonna never, you know, water down the rewards, we're always gonna make sure they have the best value out of those rewards. Um Yeah. So I mean, really, I mean, we look at various KPIs out there. I mean, I would look at the transactors uh we looked at any kind of balance transfers that we're doing out there from some of our promotional efforts, which we're able to add into the rewards card as well. Um, you know, any kind of like, you know, uh product uh reward options out there around gift cards or e-gift cards. Uh, you know, we we never had a rewards program before. Our members are using e-gift cards over the you know, the plastic cards, the physical cards, right? Which is really surprising because a lot of people like to gift those cards. Well, now electronically you can gift it, right? But I think if you'd have started this years ago, people would have been doing the physical versus electronic. Um, but our members have opted for those digital or e uh gift cards.

Transparent Value Without Devaluing Rewards

SPEAKER_01 11:15

Okay, you you mentioned value. That that's a pretty big discussion right now. We have the K-shape recovery, some customers, excuse me, let's start that again without the burp. Um you mentioned value. That's a pretty significant topic uh an area of interest right now within our community. Yeah. Uh make sure that the the program has value, make sure you're providing value to the customers and value to the organization. You know, what does value mean to you, especially with the new products, you know, the things that you do to listen to and understand your customers? How are you looking at value from an organizational perspective?

SPEAKER_00 11:46

Yeah, I mean, our our commitment, especially with the newer loyalty program to our members, has always been to have a very transparent loyalty program, right? Uh discount through promotional efforts, uh, never devalue uh our rewards currency uh and currently are always evolve uh the experience and the offerings for our members, right? So um, you know, again, I like I said it earlier, we're not a breakage, we're we're not looking at that kind of approach. We want to educate our members, make sure that they see the value as much as we see the value in the in the product because they're the ones uh that are using it. You know, and I know we have talked about this before. Another thing I was thinking about, Mark, around the differences between financial institutions, credit unions. Um, we don't sell cards, right? Uh we actually go to our members and we promote the value of the products, right? And then they pick what they want, you know, what's best off out of their lifestyle. So uh is it a non-rewards card with a lower APR or is it a rewards card that they can track, trend, transact on and get rewards out of it, right? We're we're okay with whatever direction they want to take. We just want to make sure that they're gaining value out of those products.

SPEAKER_01 12:43

That's interesting too. You you're not trying to necessarily sell them on something there's going to be kind of a kickback from an association, uh, one of the issuers, right? You're you're really trying to make sure that you're doing the best for your customers in in whatever time of need or whatever time of opportunity they that they have, correct? Yep, yep, correct. Okay.

Winning Younger Members With Real Time Rewards

SPEAKER_01 13:04

Younger generations, uh Gen Z, the millennials, uh, how do they look at uh credit unions? Are they the big fans? How do you engage with them? Uh kind of tell them what you guys do, how you do it, and and how do you how do you get them involved in your customer loyalty program?

SPEAKER_00 13:20

Yeah, I mean, you know, we we start off our our younger members with a uh a Fad Cat card where they can get under 13, and then when they they get 13 plus, they have a CARD account, and then they go to a regular checking account uh or regular debit card, right? And then the entry point once they turn 18 is to transition them into a credit line, right? A credit product, start building their credit off of a product, right? Even if it is a lower uh balance out there. So, you know, we always see debit as the entry point for credit. Um, but you know, we know that they uh prefer real-time rewards, right? Experiences, travel. Uh, we're working to you know, market and push those things out there. We do have those items available. Um, and you know, we're like I was talking before, we really do have that presence with the digital gift cards over the plastic. They want these things real time, right? They want their cash back real time. They want to go on a trip or they want to experience why they're on their trip. So uh we're definitely seeing a lot more of that, and we're working to get that out to that population to make sure they're aware of all those reward types.

SPEAKER_01 14:11

That makes perfect sense.

Emotional Loyalty And NPS Feedback Loops

SPEAKER_01 14:12

Yeah. Emotional loyalty, another topic that's pretty important to us. Uh, we talk about it a good deal. We have digital roundtables that focus on that. You know, how are you looking at emotional loyalty? Uh what do you what what what what is your perspective? How do how do you measure it?

SPEAKER_00 14:24

Yeah, yeah. I mean, you know, we we do uh NPS scoring out there, uh net promoter score uh out there, um, you know, and we've done a uh quite a bit of surveys. So part of our early month on book when somebody you know adds a card is, you know, we're we're engaging them with welcome and activation, security usage, but our last port part of that experience is a survey, right? To gauge on how they're doing with the experience. You know, what do they think about the extra product? What can we change, right? And again, what we hear from our members is a know and trust uh SECU. Um you know, generally speaking, they've been very happy with the the loyalty programs. Of course, everybody wants uh you know more. Um and so we're certainly working on those things, right? But um, you know, I I think we're we're very local, right? And our members know that that we drive that that value with our members. Uh a lot of you know, our pitchers on our site are from places that our members have been, right? So it relates to them. Um, you know, our bottom line is their bottom line. We reinvest in our members um to make sure that you know their financial financial needs are at the at the top of our mind.

SPEAKER_01 15:22

That makes perfect sense.

A Careful Operational Start With AI

SPEAKER_01 15:24

AI, another uh big uh area of interest discussion point, you know. Have you guys started to dabble in AI? Well, what's your approach? Uh, you know, how are you looking at it?

SPEAKER_00 15:34

Yeah. Yeah, I mean, uh we're we're very member focused and we're easing into the AI solution. Now pretty much all of our technology and our partnerships today uh have AI somewhere incorporated in it. Um so I think a lot of what we're using AI-wise now is just how do how do we speed up this coding or how do we get um you know this this uh you know this connection made. Um and so we're using a lot of that there. We are starting to kind of work in that, and we've actually got a channel now at SECU that's focused on AI. Um but yeah, we're we're a little bit slower in that area, but um we're we're certainly looking into it and uh digging into it. I think right now it's more operational, and we're looking to bring that into some of the other tools that we're we're launching uh later this year and next.

SPEAKER_01 16:13

That makes perfect sense. I think a lot of people are kind of still taking a concerned view. It's definitely warmed up. Uh, I think we saw that in the customer loyalty paper, but uh it kind of that that slow and steady approach seems to be what what many brands in the customer loyalty arena are are doing. For sure. Yep.

New Digital Banking Launch And Card Controls

SPEAKER_01 16:30

So when you look at uh what's next, what's new, what's the next big thing when it comes to customer loyalty or customer experience for SECU?

SPEAKER_00 16:38

Yeah, uh so we are launching our new digital banking experience actually in about two weeks now. So that's coming out, which is really gonna open the door for a lot of our card controls and other offerings that we can do product-based. Uh we're setting on an older uh platform, uh, which is gonna be done away in about two weeks. So that's gonna open up digital issuance and a lot of other things that we're looking to do with our membership. Because you know, our whole thing is we really want to meet our members where they want to be met, right? Do they want to come into the branch or do they want to be you know on digital or they want to call it in, right? However they want to do it, we want to make sure that we're meeting them there. Um so yeah, we're integrating those solutions uh into our online banking site. Um, and we really believe this is gonna be a huge catalyst um because a lot of our members are you know into the apps now, especially with COVID and all the transition people made out there. Um so yeah, we're we're doing a lot of focus on our our digital banking side right now. And very excited about that launch in two weeks.

SPEAKER_01 17:29

That's good. Looking forward to learning more about that. It should be quite interesting.

Awards Recognition And Partnership Priorities

SPEAKER_01 17:34

Uh you know, you know, at the 2026 Loyalty Expo, you were you were finalizing a number of categories. You actually pulled home a silver in the new customer loyalty program launch. You get some pretty big brands out there, so uh a lot of profits of that. And we had the largest number of submissions we've ever had. And you go out there and pull home a silver in the new program launch, and you were finalized in customer analytics category too. I mean, that was one of the top three most submitted categories. So you went out and kind of tried to punch the big boys on the nose there. Um you know, when you when you look at that, what led to that success? And you know, you know, what are you most proud of with the program?

SPEAKER_00 18:09

Yeah, I mean, number one was getting loyalty here at SECU, right? I mean, 89 years. I know credit cards haven't been around that long, but getting them out the door, we've been talking about it for years, finally getting it out, right? So um, you know, it's just been such an amazing change for the organization. Um, it's been a members ask, right? Uh something uh, you know, that we know we can grow that experience in uh and build on, right? So um we we know that there are other credit credit card products that we're looking at now um that can benefit our members. And so, you know, by getting those reward cards out, it just opens up, you know, a whole new world for us here.

SPEAKER_01 18:41

That makes uh makes perfect. So the last question, someone self-serving, you know, what can Loyalty 360 do to help you and your team with their customer loyalty efforts?

SPEAKER_00 18:49

Yeah, you know, I a lot of the conversations we even had at the uh loyalty expo was just around brand partnerships, um, you know, reputation uh branding, um, you know, looking at how we can kind of grow our footprint in North Carolina. Uh and so, you know, we're really looking for, you know, how do we engage our members uh in meaningful offers uh that ease and kind of grow their the member experiences out there? So uh we heard a lot from the from the conference, had a lot of great conversations with folks. Um so yeah, really I would say the partnerships, brand partnerships, how do we expand our footprint print in North Carolina and how do we talk up SECU?

SPEAKER_01 19:21

That's awesome. Well, there's definitely an interest in partnerships. It's kind of the orange is the new black kind of thing going on right now. But getting them right can be a big challenge. But when you do, it can be just a pretty significant boost to the program, to the brand, to kind of the overall value that customers have. So looking forward to helping you with that uh going forward. Great.

Closing Thanks And Subscribe Reminder

SPEAKER_01 19:39

Well, Brad, thank you very much for taking the time to speak with us today. Uh, it was it was great speaking with you. I've had the opportunity to hang out with you at a couple of conferences last time a little more, uh getting you personally. But I think one thing that really is resonant with you is that uh you're genuine in who you are, you're genuine about your focus for the customer, the brand, and just understanding kind of the heritage and the lineage of the SECU and just kind of that customer commitment is great to hear. Because oftentimes brands don't have that, but uh you know, uh consider you a solid friend. But most importantly, you are doing things for the customers that so many brands talk about doing. You're actually doing that's just great to see.

SPEAKER_00 20:17

Yes, sir. Yes, sir. Doing more of it every day, too. So as much as it allowed me to. So great.

SPEAKER_01 20:23

Well, thank you very much for taking the time. I also wanted to thank everyone for taking the time to tune in today uh to this episode of our Leaders in Customer Loyalty, the Brand's Toys podcast. It's great having you with us every Thursday. Make sure you check back with us every Thursday for new interviews uh with the brands who are shaping the future of customer loyalty. Uh please subscribe if you haven't already, and follow us on YouTube, LinkedIn, and our other social media sites. Uh they're listed below in the comment section. And uh looking forward to seeing you next Thursday.