All banks are aware of the importance of catering to the needs of the millennial generation. This tech-savvy cohort is set to dictate the direction the banking industry will take over the coming years and decades.
But developing a clear idea of what a certain group of customers want, and then coming up with strategies to meet these expectations, is by no means an easy task. It requires banks to develop a strong understanding of what motivates and matters to their customers.
So what exactly is it that millennials want and expect from their financial services? While there are no clear-cut answers to this question, one suggestion is that many members of this generation are happy to take a ‘hands-off’ approach to their finances, but want their bank to be ready to provide help and advice when they need it.
Offering the help and support customers need
When it comes to delivering a certain standard of service and customer experience, one concept that is extremely important for banks is having the strongest possible understanding of what matters to certain demographics and how to reflect these concerns.
As far as millennials are concerned, it has been claimed that members of this generation are not interested in micro-managing their money on a day-to-day basis. Millennials could be more likely to rely on their bank for support and advice when they come to address real-life problems and challenges, such as managing cash flow, saving and budgeting.
This point was emphasized by Colin Walsh, CEO and co-founder of Varo Money, a mobile banking platform designed to meet the needs of millennials.
He told Venture Beat: “[Millennials] just want to live their lives. They don’t want to worry about their money. And they just want whomever’s helping them to just tell them a lot of what they need to do.
“In order for companies to win, they need to offer solutions that are solving real problems.”
Mr Walsh said providers that are able to meet the needs of ‘hands-off’ users and provide holistic solutions to their problems will benefit from stronger customer relationships, increased lifetime value and lower operational costs.
Are you missing the millennial opportunity?
Banks that fall into the trap of prioritizing sales and revenue generation over goals that are harder to quantify but could prove just as significant in the long term – such as customer experience and expectations – run the risk of missing out on valuable opportunities to earn long-term consumer trust and loyalty.
The November 2016 issue of the Digital Banking Report, sub-titled The Millennial Mind, argues that millennials represent a “tremendous upside opportunity” for banks, but this generation reports the most problems with financial services and is the least likely of all age groups to have their problems resolved.
Report author Jim Marous notes: “Millennials are the generation least likely to strongly agree that their bank knows them, looks out for them or rewards them. While partially caused by being a more demanding segment, they are also the most ignored by the industry.”
In our current era of increasing diversity and competition in the retail banking industry, it has never been more important for banks to make a special effort to engage with their customers, to find out what matters to them and to invest in delivering on those findings.
Using all of your consumer-facing touchpoints and channels of communication to build meaningful engagement with millennials could be vital to the development of long-term, mutually beneficial relationships with this key demographic.