The financial services industry is continuously evolving, and it is essential to optimize collections strategies to maintain liquidity and minimize risk. One of the most critical choices for credit un...
In my last post, we took a look at three financial products (prepaid cards, check cashing services, and payday loans) that are popular with Gen Y. We discussed why millennials prefer to use them and offered some ideas on how to attract and retain Gen Y with these products.
In this post, I'm going to delve deeper and explore the importance of convenience.
No matter the gender or economic status, all millennials expect financial institutions—or any business, for that matter—to offer convenience. In fact, availability and convenience are the biggest factors millenials consider when deciding who to bank with, which is why most opt to bank at larger institutions.
If you're racking your brain on how to up your convenience factor, but aren't sure where or how to start, here are a few things you could do to get millennials' business:
Optimize Your Online Banking Experience
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Millennials are digital natives (big surprise, right?), but simply having an online banking site doesn't mean you're providing the convenience millennials seek. You have to optimize your website and online banking portal for how Gen Y uses them.
Although Gen Y is thought of as one group, there are actually two distinct subgroups that make up Gen Y. According to a study by Javelin Research & Strategy and their partner, Comerade:
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Gen Y.1 is made up of 31 million individuals who are 18–24 years old. They are financially inexperienced college kids, and many still have someone else managing their money.
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Gen Y.2 is made up of 42 million individuals who are 25-34 years old. For the most part, they have all the responsibilities that come with being an adult. They are educated, employed, and they manage their own money. This subgroup is generally experienced when it comes to banking, but they still need help with financial planning.
To optimize your online experience for Gen Y, make it easy to open an account online. Many financial institutions tout the fact that they allow consumers to open an account online, but skirt over the fact that you either have to go through an arduous process or go offline to complete the action. Audit your current process to find out how difficult it is to complete an online account opening, and then find areas where you could make it quicker and more seamless. Forcing someone to jump through hoops to open an account online, is like forcing someone today to use dial-up Internet via a land line. You remember those days back in the 90s when it took 10-20 minutes and a lot of screeching and beeping before you could access the World Wide Web? It wasn't pleasant. And, if someone made you go through that today, you'd quickly dismiss it and simply pull out your smartphone.
Your institution should also make the products and services millennials want and need—like prepaid cards, student loans, and credit cards for Gen Y.1 and investment/retirement accounts, home loans, and savings accounts for Gen Y.2—easy to find on your website. Make sure they are shown in your top navigation, link to them on related product pages, and run campaigns periodically so they get some visibility on your home page. Don't bury them more than two clicks from the home page, or else they'll never know you offer them. On your online banking portal, use side navigation to make all of these products and services one click away, and make account balance/recent activity the default page they land on first.
Another thing to consider is creating a robust resource center that can be accessed from both your website and your online banking portal. Millennials want to be educated about finances, but unlike other generations, they aren't going to walk into a branch or call you within your working hours to learn what they need to know. They grew up finding answers to their questions online, and that's not a habit that can be broken. If you provide tools and resources that are available 24/7 on your site, you'll become their go-to for everything financial, and they'll reward you with a long-lasting banking relationship.
Get Mobile Already!
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You don't need a survey or stats to know that smartphones and tablets have taken over the mobile device arena. While there aren't "all mobile" banking customers yet, it's possible that all mobile customers will be a reality in the not-so-distant future. An article by the Filene Institute states, "these devices are being adopted 10 times faster than the PC was in the 1980s and three times faster than social media!”
Going mobile is important because that's the direction the world is going. If you don't have the resources or funds to develop "an app for that," there are things you could do to optimize your site and online banking portal so that they look cleaner and are easier to use on any device. While it won't be as nice as having a true app, optimizing your site for mobile will hold you over until you can develop that technology.
Be where Gen Y is (or at least have an ATM there)
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While Gen Y-ers are more digital than other generations, there are times when they, too, have to stop by a physical location. But, they don't want to have to go way out of their way to do so. If you truly want Gen Y's business, you must make them part of your corporate planning strategy. Is your institution planning on adding new branch or ATM locations within the next year? If the answer is yes, here's some advice:
Don't put them next to a Dell-Webb community or Luby's cafeteria! (#kiddingnotkidding)
Instead, do some research to find out where younger people live, work, and hang out; then, put your new branch or ATM there. You could also consider partnering with a surcharge-free ATM network to give your young customers even more places to access their funds. One example is Allpoint with 55,000 locations worldwide. They even have a mobile app that lets you find the nearest ATM locations. Talk about dramatically increasing the convenience of withdrawing funds! With a whole network of ATMs available, your customers would be able to withdraw money at several well-known retail stores, gas stations, shopping malls, and other businesses.
As discussed in my original post, titled "Gen Y: Why They're Every Institution's White Whale (and What You Can Do to Conquer Them)," sitting on the sidelines hoping Gen Y comes to your financial institution is clearly not an option. Whatever approach you decide to follow, keep in mind that convenience is key to this age group.
Keep an eye out for my next post in this series where I discuss building a meaningful relationship with millennials. In the meantime, let me know what your institution is doing to attract, acquire, and retain Gen Y by dropping a note in the comments section below! Feel free to share your success and/or failures.
Check out this entire series:
Vol. 1: Find out which products products and services millennials love.
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