BY KEVIN FLANAGAN
Is your credit union tapping into the financial gold the Millenial generation represents? To hit pay dirt, you’ll need to provide such members with prompt and highly personalized customer service. Discover some of the perhaps unexpected means of striking it rich with this demographic.
It’s easy to make generalizations about various demographic groups. For instance, Baby Boomers are technology-phobic. Members of Generation Z, who are still mostly in high school and college, were seemingly born tweeting.
And then there are the Millennials. Generally identified as being between the ages of 21 and 35, this demographic is fast becoming America’s most powerful consumer group. And that certainly makes them an attractive target for virtually any business.
But who are Millennials and why are they important to credit unions? Well, they’re a group whose habits are somewhat difficult to generalize. While most of them came of age in the digital world of smartphones and online music, they aren’t completely devoted to an all-online lifestyle. And from the perspective of credit unions, Millennials represent an untapped goldmine of potential members.
According to consulting firm Deloitte, by 2020 Millennials will make up an estimated 50 percent of the global workforce and are expected to control between $19 trillion and $24 trillion on a global scale. That type of financial power represents an incredible business opportunity for credit unions.
As wealth transfers to Millennials – who are surpassing Baby Boomers as the largest demographic in the United States – credit unions are well-positioned to provide this generation with the prompt and highly personalized customer service they desire. The timing is right, as Millennials have begun to reach the stage of life where they are making major purchasing and financial planning decisions.
While Millennials are a generation that embraces the latest service models, such as Airbnb and Uber, research shows they still want to have in-person conversations with well-informed experts before making major financial decisions. In fact, among the major demographic groups – including Baby Boomers (between 55 and 71 years old), Generation X (36 to 54 years of age) and Generation Z (18- to 20-year-olds) – Millennials are among the most likely to come into a branch to conduct a financial transaction.
In a recent survey of credit union members conducted by TimeTrade, Millennial respondents revealed that they expect a high level of service from their credit union. They also showed a willingness to schedule an appointment with a specialist at their local branch, a tendency which presents credit unions with opportunities to upsell high-end services, such as mortgages, home equity loans and financial planning programs.
Credit unions that want to take full advantage of Millennial market opportunities must provide a superior customer experience across the entire customer journey – from an initial digital touchpoint to the in-branch experience. Savvy credit unions that focus on meeting their members’ evolving needs and providing the personalized service that Millennials seek will reap the rewards that come from long-term, loyal members. The trust that credit unions work to instill in their member/owners is especially appealing to Millennials.
Here are some Millennial credit union experience data points that are of particular interest to those responsible for driving membership growth at credit unions:
- Millennials are more likely to visit a credit union branch (57 percent) than a bank branch (48 percent).
- Nearly half of Millennials (49 percent) visit a credit union to open an account.
- 43 percent of Millennials value personalized service from a credit union more than a bank (34 percent).
- 77 percent of Millennials would be willing to schedule an appointment to meet with a specialist in a credit union (i.e., mortgage specialist, wealth management, loan officer).
- 93 percent of Millennials are willing to answer a five-question survey from their credit union to provide feedback on their most recent branch visit.
- 88 percent of Millennials would be willing to go into their credit union on a weekday if offered a guaranteed appointment time.
Just as there’s no such thing as one-size-fits-all clothing, so too there is no single trait or tendency that applies to all members of any given demographic group. But when it comes to Millennials, TimeTrade’s research surveys show they highly value in-person contact when conducting financial business.
Like all consumers, Millennials want to be respected by those with whom they do business, they want answers to their questions, and most importantly, they want to feel as if their business is valued. All of these characteristics fit very well with the way credit unions strive to serve their members.
Ultimately, to win business from Millennials, credit unions must market themselves effectively to this increasingly powerful generation. But equally important, CUs must use the technologies preferred by Millennials – online and mobile – to bring them into the branch for personalized conversations that drive business. That is how credit unions can attract Millennial members so they can meet their financial needs today – and for many years to come.
Credit unions that have the greatest success serving the Millennial demographic will be those that are willing to go the extra mile and provide “We’ve been expecting you” service to every member, every time.
Kevin Flanagan is director of content for TimeTrade. His responsibilities include managing the company’s surveys that capture consumer preferences about retail, finance and other industries.