16 Sep How to Attract and Keep Millennials
A new age of consumers, employees, and decision makers are on the cusp of creating monumental changes for most industries. Millennials are breaking into the workforce and heavily influencing the world around them. About one third of the American workforce is aged between 18-24 and their numbers will only increase as more and more millennial graduate and replace baby boomers as the dominant generation in the American workforce. The transition from education to employment leads millennials to a newfound financial freedom as first time in many of their lives they now enjoy a sense of disposable income and self-reliance, that is both liberating and stressful. Away from parents and the pressure of school, millennials’ decisions now lie entirely in their hands. This freedom leaves many millennials at the helm of their financial decisions for the first time in their lives.
The surge of this younger generation into the workforce creates new opportunities for many industries, especially banking. Soon, as millennials continue to work and build wealth, they will become one of the largest consumer populations the world has seen. So what can banks do to attract and retain millennial customers? Below are four opportunities banks can optimize to satisfy millennials.
Opportunity #1: Perfect the Mobile Experience
Millennials are much more tech savvy than Gen X and Baby Boomers. Thus, they expect their digital experiences to be easy and frictionless. A study conducted by Forbes found that, “Millennials are accessing their financial information via mobile device eight and a half times more often than other generations; a trend that is only expected to grow with time.” Millennials can shop, communicate, work, and even date from their phones. It is expected that banking should be as convenient as opening an app.
Most big banks have invested in creating easy to use banking apps. When considering how to allocate resources and invest in their brand, smaller banks should prioritize creating a memorable and fluid mobile experience if they seek millennial customers. Millennials are a mobile generations who seek instant satisfaction; they want to be able to check their accounts, manage their money, make financial decision, and ask for help on one functional platform. Having a strong mobile presence is a great tool to secure millennial customers.
Opportunity #2: Accessibility and Innovation
Millennials are the first generation of banking customers that will not be totally reliant on in-branch visits to satisfy their banking needs. J.D. Power found that the unhappiest banking customers are those forced into one specific service channel and overall satisfaction is lowest among retail banks that only offer digital or in-branch banking services. The most satisfied surveyed group are branch dependent, digital customers. These customers visited a branch location 2-3 times in the past 3 months yet completed the majority of day-to-day banking digitally.
Banks looking to attract millennial customers should look to modernize both in-branch and digital experiences.
There is a great opportunity to merge the digital and in-person experiences. Technology can be used in branches to help customers find want they need. Innovations such as HSBC’s customer engagement system dubbed, Pepper, which offers an appealing and personable alternative to waiting in line to see a teller via a robotic interface. Pepper greets customers, can help with specific inquiries, and briefs tellers of customer needs. Banks can also optimize their digital experience to feel more personal by adding simple functionalities to ask for help such as live-chats and easy to access customer service.
Opportunity #3: Educate and Advise
Millennials are a very apprehensive generation when it comes to trusting large corporations. Growing up during the 2008 financial crisis, it is understandable why they are especially weary of banks. As a result many millennials do not utilize the financial help that banks offer. In one survey, only 27% of millennials have sought professional financial advice. Millennials should not be fearful to consult their bank for future financial decisions, so banks must find ways to rebuild trust to the millennial generation. One way to start is by incorporating financial help into mobile app to allow millennials to explore the resources banks can offer through a platform they trust.
Opportunity #4: Stress the Triple Bottom Line
Millennials are the most socially conscious consumer generation. As such, they have high expectation on how companies should conduct business. Banks need to realign with millennial expectations by focusing on the triple bottom line: Profit, People, and Planet.
Editorial assistant at Publishers Weekly, and peer acclaimed millennial expert, Orem Smilansky explains that Millennials have “begun to see brands not as badges, but as mirrors that reflect their values and beliefs.” Millennials are a generation that will either support or reject a company based on its impact on the community. Banks not only need to worry about providing excellent products and experiences, but they also need to be improving the communities where they are involved. Becoming socially conscious will not only increase millennial interest, it will increase brand awareness, employee satisfaction, and community loyalty.
Banks have a great opportunity to attract and retain millennial customers. Investing in efforts to increase millennial interest will be very worthwhile for banks. Millennials are a very demanding generations and banks should reevaluate themselves if they wish to stay competitive.