Financial technology companies and banks have long catered to baby boomers and their decades-long loyalty. But in today’s digital world where sending cash via Venmo and Paypal is as common as making a purchase using a Square card chip reader, fintech companies and banking institutions are hard-pressed to quickly understand the millennial mindset when it comes to spending, saving and managing money. Their revenue and existence depend on it.
The Millennial Generation
It’s been shown that Gen-Y, the group of people born between 1982-2000, are the fastest growing generation in the U.S. workforce. Just as impressive, the millennial population in the United States alone counts nearly 80 million people; all of whom help compose the most diverse and educated generation that history has seen to date. The most remarkable fact of all? Millennials have never lived without the internet. The instant gratification available nowadays spills over into banks and finance, where 20 and 30-somethings want personalized services.
As you can imagine, this poses huge challenges for more traditional fintech companies that have been unable to prove their relevancy and value to a huge amount of people who could be customers.
Marketing to Millennials
The Millennial Disruption Index was a three year study that captured insights from over 10,000 Americans across 70+ companies and 15 industries, hoping to better understand how companies can reach the growing group. Findings showed that loyalty to banks was particularly low, with 33% of millennials stating they’d change banks without hesitation within the next three months. Incredibly, the same number of millennials told Goldman Sachs that they don’t expect they’ll even need a bank in five years.
So what can a traditional finance company or bank do to appeal to people who already believe that they don’t need its products or services? Here are a few ideas.
1. Cohesive and Attractive Branding: How a person perceives a brand can have a deep impact on how successful marketing efforts will be. Traditional fintech companies or banking institutions should re-evaluate their position, messaging, design, content and experience to ensure that each appeals to a new target demo. On the experience side, mobile apps, loyalty programs and social plugins can all help make using a product or service feel more modern.
2. Social Media: Millennials speak social media fluently having grown up with platforms like Facebook, Twitter and Instagram. Once a company has invested in branding that has potential to attract new customers, social media platforms can be a powerful place to acquire and engage with the right people. Remember: Whether satisfied or unsatisfied, Gen-Y’ers will post to social media and word will spread quickly.
3. Thoughtful and Relevant Partnerships: Fintech partnerships can be exciting and ‘sexy’ if they’re well-sourced and executed. Paypal, a company that’s transformed over the last two decades, often pairs up with relevant partnerships that range from small, community-based orgs to larger companies. Tilt, a platform that helps you collect money from friends for free, reached college students by partnering up with popular music group The Chainsmokers for a crowd-sourced campus tour.
4. Social Causes: Do some good! Social causes are often at the heart of communities, having already brought like-minded people together. A fintech company or bank that sponsors a cause not only helps do good but gets the exposure benefit amongst members. If a company isn’t able to serve as a sponsor, simply being socially-conscious itself can have benefits: 89% of millennials say they’re more likely to buy from a company with an environmental or social mission.
5. Relationship Building: Once potential customers have engaged with a company, engagement efforts and a focus on retention can help people stick around. From there, happy millennial customers should feel happy enough to share with their networks (both online and off) and shout from the rooftop about a product or service that actually works for their digital, personalized life.