Best practices in financial marketing may be outdated, as millennials — the largest generation in American history according to the American Banking Association (ABA) — have different consumer behaviors than previous generations who lacked the technology and social awareness that drive spending habits today.
It would be wise for banks to start paying attention to what's important for people in this key age group, which spans those born between 1980 and 2000. That's a wide range, but what unifies millennials are the tech-savvy habits and purpose-driven philosophies that are undeniably becoming the new norm.
It's probably no big shock that digital banking gives institutions a significant edge. According to the ABA, millennials are three times more likely to open a new account on their phone rather than in person, so it's becoming increasingly important for banks to have mobile offerings.
Taking it one step further, all the big players have launched or are in the process of launching digital-only offerings. Capital One 360 offers high-interest savings and checking accounts with one caveat: no bank branches (except for a select few).
Capital One Cafés are all over the country, and they essentially act as a storefront for these digital banking products. Since the younger generation doesn't value in-person banking as much as, say, the baby boomers, this gives millennials exactly what they crave: convenience with a side of caffeine.
The takeaway here is that online banking provides the convenience and transparency that traditional bank accounts always lacked. Banks should appeal to millennials' desire for online banking by promoting these options on digital channels where this audience spends the most time, like social media.
Authenticity in Financial Marketing
For smaller banks and credit unions, it will be a challenge to compete with major banks in terms of digital offerings (though that doesn't mean you can't try). But these institutions can gain an advantage by appealing to millennials' sense of social responsibility. According to the Financial Brand, millennials engage with authentic brands that align with their values.
SunTrust Bank makes its purpose-driven mission a core part of its digital presence, reported the Huffington Post, putting a human touch on the notoriously impersonal banking industry.
Additionally, according to Inc., millennials are showing a rising interest in credit unions due to their cooperative, customer-centric business models. Credit unions can embrace this with marketing and tools directed toward younger users, including personal finance resources and intuitive mobile apps.
Regardless of the size of your organization, the key things to remember when tailoring your financial marketing strategy to millennials is to keep it real, and keep it digital.