- Millennials make up 22% of the population with over $200 billions spending power
- They have a strong preference for digital channels and self-service but still want a personalized experience
- Focus on building relationships instead of sales and appeal to emotions
- Use social media to provide authentic and useful content
- Build trust by staying true to your brand’s promises and continually deliver value
The oldest millennials are already in their late 30’s, but many financial institutions still haven’t managed to market to them properly. Pew Research defines millennials as having been born between 1985 and 1996 (although this is subject to debate), and at 22% of the population or 80+ million people with a spending power in excess of $200 billion, Millennials are a market force to be reckoned with.
Despite that, marketing financial services to millennials is still a hotspot of debate and indecision, as many banking organizations continue to focus on baby boomers, or skip the generation altogether to focus on Generation Z.
At the same time, millennials are often deeply involved in financial problems, with debt, strong intentions to save following the financial crisis in 2008, increasingly good jobs and the ability to invest in housing, savings, and travel. Financial marketing to millennials is often less about offering perfect features and services and more about creating an emotional appeal, developing trust, and making the right services available in the right way.
What Do Millennials Want From Banks?
Having a clear understanding of millennials’ banking habits and preferences will help to properly shape your marketing strategies to meet those needs.
Get in Control of Digital
Millennials are not the digital generation, but many of them are online constantly. With a high demand for digital services ranging from apps to chatbots, it’s crucial that you create and maintain a strong digital presence.
For example, millennials are increasingly looking for digital banking services, digital debt, and portfolio management, and apps offering a full suite of services – so they don’t have to connect with their bank in person.
In one study, Gernalto showed that only 27% of millennials say they’ve never visited a bank branch, only used its online services. At the same time, 18% of millennials are smartphone-only Internet users. Millennials also account for about 43% of all mobile banking and finance users.
Similarly, millennials tend to prefer online chat and even chatbots to calling a human assistant. Providing self-service solutions in apps and on your site to minimize human contact will give millennials more opportunities to connect with your brand – without forcing them to interact in ways they prefer not to.
If you can’t offer online chat, make sure you have a strong FAQ or self-help solution available to help users make decisions before contacting customer support.
This also includes allowing millennials to sign up for accounts and services online and giving the customer more control, so they can choose when and where to opt in or out of services, and when and how to contact you and initiate a relationship.
Build Relationships Not Sales
Relationship marketing is the process of building relationships and trust through real and valuable services, customer contact, and outreach. This can take the form of finding innovative ways to connect, such as through social media and apps, using disruptive ways to connect in person, and through consistent customer service and representation.
Marketing financial services to millennials or any potential customer should not start with a hard sales pitch. For example, community outreach programs allow you to connect and reach out in person – giving millennials opportunities to learn more about savings or debt management through free workshops, bringing them into the bank.
Once you’ve made the connection and provided some value, you can more easily follow through with a hard pitch for a product or service. More importantly, once you get to know the customer, you’ll have a better idea of what their problems are and what they need. Of course, you can create similar programs through:
- Facebook Live Video
- Social media
At the same time, customer service focus has to be on providing value to the customer rather than making a sale. If you can provide consistent value, even if it means recommending a more affordable product or service, you will begin to build a relationship.
Focus on Debt Control and Payoff
Millennials are often in debt, and famously so. While this doesn’t hold true for everyone, many millennials entered the job market during the financial crisis, have massive student debt, and often struggle to invest in a home as early as their parents.
Creating marketing campaigns around easy solutions for debt management and payoff, as well as savings and wealth management will help you to market based on what millennials are actually concerned about.
46% of Millennials in a study said that they believed they had too much debt and were strongly interested in solutions that would help them to learn more about managing and reducing it.
Market to Emotions
Millennials are the most brand-loyal generation to-date, and you can capitalize on that by playing into emotions and connecting to life events as part of marketing.
For example, millennials are proven to be less interested in saving and creating wealth for themselves and more interested in doing good and investing in others. A good financial marketing strategy for millennials for wealth management and investment would be to focus on having money for children, family, and even for charity rather than simply accumulating wealth.
If emotions aren’t something you can target, make sure that you’re approaching relevant millennial interests. Baby Boomers are often concerned with investment and wealth growth, which is often simply not something millennials care about.
Understanding millennial banking trends such as what topics this segment is actually interested in will help with putting out the right content.
Some ‘hotter’ topics you can use to create an emotional appeal surrounding their real-life problems:
- Student debt
- Money management
Social Media Storytelling
Social media is an increasingly important financial marketing channel, especially for millennials. For investment finance, LinkedIn is often the place to be, with millennials sharing about 13% more about finance than on any other channel. However, simply having a presence isn’t enough.
In one study, TD Bank showed that 59% of millennials look for personal advice on topics ranging from savings to budgeting to credit cards, and they will contact social media or chat representatives for advice. Having a clear way to either offer that advice or direct individuals into workshops or in-person consultations can help you to drive value and build relationships.
Using social media to share storytelling and advice as well as success stories, while reaching out to offer that kind of personalized advice will help you to gain customers while tying into relationship building. Creating and sharing content and information that shares stories from young people and peers, while offering relevant and timely advice and helping users to reach goals they care about (like buying a home, starting a family, paying off debt, or travel), your social media can become a valuable tool for attracting and retaining customers.
Creating a Brand Millennials Trust
Millennials look for brands and corporations they can trust with their data and their money.
Most importantly, millennials are incredibly brand loyal once you build their trust, typically through personalized connection and personalized service. While that may seem to be at odds with the millennial preference for a self-service and online chat, once you can connect and build a relationship, it’s difficult to break if you stay true to original brand promises and continue to deliver value to the customer.
Focusing on offering honest and personalized services rather than big promises will help you get there. For example, many fintech companies offer unbundled services, allowing users to pay for what they need or to build their own service bundle, so they can add features, services, or options based on need and increase at any time.
Similarly, being upfront about fees, waiving service fees, or using either service representatives or automation to offer custom services, pre-approval for loans and mortgages, or other services will help you to connect and make a difference.
While learning how to attract millennial customers should be an important part of your bank’s marketing strategy, actually retaining these customers is also very important. According to a recent study by Gallup, millennials are the most likely generation to switch their primary bank.
Millennials bridge the gap between Generation X and Generation Z, and as you might expect, are often squarely in the middle. Most greatly prefer self-service and digital options, with a strong preference for online chat and solutions, but still, want to make connections and have a personalized experience with their bank. Most importantly, millennials want to see authentic and genuine services and a brand that represents its values and what it’s offering.