Cracking the millennial code: Building better banking relationships with digital natives
A recent survey found that 71% of today’s millennials would go to their dentist than hear what their bank has to say1. Ouch. With over 80 million millennials, this group represents the largest demographic in American history, and they are quickly becoming the most important consumer base. They are making financial decisions now that will affect the rest of their lives such as paying off student loans and buying their first homes. And yet they hate dealing with banks—as evidenced by their behavior:
- 1 in 3 millennials are open to switching banks in the next 90 days
- More than half of them think their bank isn’t very different from all the other banks
Studies tell us that banks are at a higher risk of disruption than any other industry. This means banks need to find creative ways to engage and drive loyalty among millennials. Banks with innovative offerings are better positioned to engage millennials with services like mobile payments, mobile banking and self-service, real-time financial management. This kind of digital-first approach enables banks to engage millennials in a personalized way, and retain them as customers through flexible engagement and ongoing education.
Bankers who adapt to serve this millennial customer base will deliver on the following expectations.
Flexibility
In an age where customer experiences happen across multiple touchpoints, banks must keep up. Whether it’s at the branch, at the ATM or on the mobile app, banks need to offer millennial customers the flexibility to bank whenever and from wherever they want. In short, millennials want choices. Let them choose the platform that works best for them to get the authentic and quality experiences they desire.
92% of millennials said they would choose a bank based on digital offerings2. And, 67% want digital budgeting tools to help them manage their money—that’s more than any other customer segment3. For banks to win over millennials, it’s imperative to embrace technology to enable authentic engagement regardless of whether a customer chooses to bank through a mobile device, in person, on the web, via text or another channel.
Education
With so many millennials at the age where they begin making significant financial decisions, banks need a comprehensive and interactive approach to engage and educate their customers. This means offering educational tools that are interesting and informative to help them better budget and manage their finances. The brochures and snail mail of yesterday won’t work here. Millennials expect more. They want entertaining blog posts, visually-appealing infographics, funny videos, insightful webinars and personalized, in-app budgeting suggestions.
Personalization
With all this in mind, it’s important to remember that millennials are not one-size-fits-all. Millennials are the most ethnically diverse generation in United States history. They are less likely than previous generations to declare religious and political affiliation. And their lives are progressing at totally different rates: they are choosing to get married, go to college, have children, and switch jobs at different times than their predecessors. Because of this diversity, they are difficult to put in a box and no one service will work for every millennial customer.
That’s why it’s critical to offer millennials personalized, targeted services in order to remain relevant and drive loyalty. For example, younger millennials may not be ready for traditional banking services, such as mortgages, especially because many young people are delaying home ownership. This means that banks need to get creative to find ways to engage with these customers in a way that is relevant to their unique financial situation. Engaged millennials are not only passionate brand advocates, but they also have a high degree of brand loyalty. Address their preferences now, and they’ll keep coming back.
Engaging millennials requires a different kind of solution
Banks are losing loyalty and face-time with customers, making it imperative to repair their approach to customer engagement by focusing on providing more transparent, engaging, digital customer experiences. VeriPark Next Best Action is designed to help banks with attracting and retaining millennial customers who want to seamlessly bank whenever and wherever they are.
The solution helps you market to customers in a relevant way, presenting the best-fit offer to individual customers with every interaction: whether a customer logs in to the mobile app, uses an ATM or visits the web site. VeriPark Next Best Action even helps you manage across all your channels in real-time, using customer decisions in the system to guide future decisions so that customers are not presented offers they’ve already seen and declined elsewhere. Instead, customers get relevant offers presented at relevant times.
Try it yourself
Want to learn more about VeriPark Next Best Action? Try the solution today at AppSource.com. And stay tuned for more ideas on adapting to the digital disruption that’s underway.
Sources
1 Scratch, “Millennial Disruption Index”, 2013
2 American Banking Association, “Eight Illuminating Data Points on Millennials and Banking”, 2016
3 American Banking Association, “Millennials and Banking”, 2016
