A millennial who graduated this decade with a journalism degree from a Big10 university provided the following insight for me. I believe it accurately conveys the mindset of his peers. While many credit unions are struggling to attract this demographic I believe the best opportunity for growing membership is in listening to and creating proponents from existing millennial members already doing business with you. At the end of each section I’ve highlighted what I believe to be some key areas of emphasis.
Mobility = Convenience, Loyalty Doesn’t Matter
“Millennials want convenience. They want to be able to transfer money sitting at their breakfast table or to deposit checks into their accounts on the go. They have less (no) brand loyalty; Millennials have no problem switching financial institutions as they enter and leave college and then switching again as they scatter themselves across the country wherever the job market lands them. With the job market still floundering, millennials are more migratory than ever. A 2014 study from the U.S. Census Bureau found young adults between the ages of 20 and 29 have the highest migration rate of any age group. (paa2014.princeton.edu/papers/140972) More millennials are trading in the rural lifestyle for the big cities, leaving smaller community institutions behind. Although many credit unions have shared branching capability to extend their reach – that can be misunderstood and intimidating to millennials. Seventy-one percent of millennials would prefer a trip to the dentist over dealing with a bank, according to Scratch, a consulting firm that specializes in millennials. (http://www.millennialdisruptionindex.com/) Why then would millennials want to deal with two banks when most say they would prefer to not even deal with one?”
Action Item: Convenience (the online kind) will trump loyalty, period. You better be providing it. They’ll go where the job market takes them & switch institutions in a heartbeat. Do you make it simple for them to join & open accounts online?
“From this millennial’s perspective, the keys to attracting and keeping us as customers are marketing and technology. Technology has changed everything and millennials have grown up with it, there’s no fear – we look forward to embracing changes that improve convenience. I’m not alone in preferring to do my banking from the comfort of home or on the go. I want options. Give me the ability to deposit my checks remotely. Allow me to easily pay my bills via smartphone app. Provide me with a calendar feature to alert me when my bills are coming due. As the number of online banking options explodes, visits to local branches will continue to diminish and I’m OK with that. It’s up to credit unions and banks to adapt or get left behind. That’s not to say we don’t want a physical location. If I have a problem, I want to be able to talk to a person – not a robot on a phone or an internet message system. Branchless banking – assuming it comes with quality customer service – is an option millennials would embrace.”
Action Item: It’s not enough to provide options – they want to direct the interaction & transaction. Cash flow is tight, they need to control the timing of when payments will be made.
“The other essential to keeping me is marketing. Simply put: Prove to me why I should stay with your bank. What does your company offer me that others don’t? What sets you apart? The disruption index shows that credit unions haven’t done a good job differentiating themselves from the competition. The majority of millennials don’t believe their bank offers anything different than other banks. Communicating the differences to a group that is increasingly mobile and increasingly desensitized to advertisements – is a challenge. TV ads are out – many of us long ago traded cable and broadcast television for streaming services like Netflix and Hulu. When it comes to radio we’ve switched to online music services over traditional local radio. I promptly discard mail advertisements. Most of us have been conditioned to ignore internet ads.”
Action Item: Tell them how you’re different – not that you have mobile apps like everyone else. Tell them how you will make their life easier – paying your bills over the phone by snapping a picture of them isn’t just easy, it almost makes paying them fun.
“So how do you reach us? Try our phones. Text us or send us push alerts through your mobile apps. A 2014 report from Bank of America shows that 85% of respondents check their smartphone at least a few times a day and the youngest of millennials ranked their smartphone as more important than the internet, deodorant and their toothbrush. (http://paybefore.com/wp-content/uploads/2014/07/2014_BAC_Trends_in_Consumer_Mobility.pdf) Not every text or push alert will be read. But by texting updates or promotions, or sending push alerts built into apps, you’ll have a higher success rate of reaching us.”
Action Item: Messaging needs to be targeted through their phone – do you have the tools to make that happen? It’s your best bet for communicating with them & it actually being read. As a dad of two millenials this is how I stay in touch & convey what’s important.
“Credit unions can’t afford to take millennials for granted. Never stop courting me as a customer. We’re a mobile group poised to make career and housing decisions that could easily take us away from your primary market. Communicate with me, your current customer, rather than focusing solely on chasing potential clients. Just because I’ve opened an account with you doesn’t mean I don’t need to be persuaded to remain. If you do that I might stick around as a customer. Don’t assume I’ll always be there, because unless you fight to keep me, I likely won’t.”
Action Item: They understand they have choices & leverage -a good member service experience and simple, effective processes are table stakes. They want a relationship based on you respecting their needs, letting them know continually that you value their business.
One final parting thought, are millenials really that different or just a little ahead of the curve?