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My younger sister Jodi and I have a lot in common. We are thankful for great careers, are moms, laugh at the same jokes and both survived growing up with three older brothers. But we’re not the same person. For starters, she is a millennial and I’m a Gen Xer. For me, learning to drive and buying my first car was a rite of passage. But Jodi couldn’t care less. Like many others her age, she thinks car ownership is too expensive and a hassle. And like Jodi, millennials are often the most educated in their family. They have massive purchasing power—with more to come as they’re poised to inherit more wealth than any other generation in history. Bummer. I was born too soon.
According to the U.S. Census Bureau, there are about 83 million millennials in the U.S. alone. Millennials are a crucial market and one size doesn’t fit all as each person varies in upbringing, ethnicity and in life experiences. The sheer size and diversity of this generation makes it really hard to get and keep their attention. Financial institutions are most at risk with this generation because the old ways of building brand loyalty aren’t working.
New behaviors clash with traditional delivery
Millennials use banks for traditional services, such as credit cards and even lending. But loyalty is a different game, and there are plenty of technology companies chipping away at mindshare and marketshare. According to Bain, U.S. and U.K. consumers ranked PayPal and Amazon nearly as high as banks for trust with their money. Millennials think of finance in terms of crowdfunding, virtual currencies and online payment platforms as much as the local branch with the drive-thru ATM.
With this reality, how can banks attract, engage and retain millennials?
1 – Get innovative with digital engagement
Large tech companies offering core banking functions are the greatest threat to financial institutions. Amazon Cash has 10,000 retail locations and Alibaba has issued $96 billion in loans in five years. Then there’s Apple Pay, Google, Snapchat and WhatsApp.
All of these companies are leaders because their strategies address millennial expectations. That is, an experience that’s convenient, multifunctional and requires only a few taps or swipes to complete an interaction. That’s critical to earn advocacy and loyalty.
Some banks have responded wisely by launching new websites, apps, Alexa skills and more. But the mega-tech companies continue evolving with services that attract millennials and build better relationships with them. What can traditional banks do?
Innovate with Artificial Intelligence across voice, web and mobile:
Omnichannel platforms, including the Genesys Customer Experience Platform, support these deeper customer relationships both now and in the future.
Learn how Atom Bank provides leading customer experience in the era of digital banking. Using the Genesys Customer Experience Platform, Atom Bank designed customer contact with security in mind while ensuring that customer effort is kept to a minimum.
2 – Get personal with customer-centric engagement
How you engage is just as important as what technology you use to draw in millennials like Jodi. She keeps her low-value savings account at a traditional bank, but she purchases other higher-value products—such as insurance and investments—from competing financial institutions.
For years, banks tried to cross-sell and upsell in a product-centric way: “for checking press 1, for savings press 2,” and so on. Shifting from a product-centric strategy to a customer-centric strategy means weaving in sales and marketing at relevant moments of need in the customer journey. This level of personalization requires predictive engagement that uses real-time data to anticipate needs. It’s the driver behind our recent acquisition of Altocloud.
3 – Get creative with early engagement
As millennials grew up, many banks initially underestimated their demands, financial power, and impact. Gen Z is next, and no bank can afford to risk making the same mistake twice.
Gen Z is different, too. They have shorter attention spans, but they’re no less complex or demanding. They expect even more out of technology and they have a lower tolerance for error in the digital domain. And remember, Gen Z is considered a “throwback generation.” They want to work, save money and avoid the trap of debt. Juggling two jobs as a full-time student, musician, and over-achiever, that’s certainly true of my niece McKenzie.
Get creative now. To capture Gen Z customers like McKenzie, banks need to fit seamlessly and creatively into their lives, to integrate technology with humanity, and to connect moments that deliver relevant and instant value through engagement with bots and humans.
Today, it’s unreasonable to expect that customers will find single blocks of time to solve issues or investigate important purchases. Within messaging apps, your customers can communicate with you during short moments of found time (for example, while on the train or walking the dog). Connecting with customers in this way dramatically reduces their effort. And it enables continuous conversations that can span hours, months or even years.
Genesys Messaging for Apple Business Chat is one type of solution. Genesys brings all marketing, sales and service channels into a single platform with persistent context, giving customers the convenience of using messaging apps such as Apple Business Chat. By meeting customers in the messaging app of their choice, you get on with your business and your customers get on with their lives.
Regardless of whether you are trying to attract and retain customers like Jodi or McKenzie, the millennial and Gen Z generations are vast and diverse markets with massive purchasing power. And like all generations, they need banking services. But they demand to do banking on their terms. How you deliver that takes innovative thinking and foundational technology that’s reliable and adaptable.
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