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PCBB Banc Investment Daily May 25, 2017
Banc Investment Daily
May 25, 2017

Email Usage And Millennial Banking

You may not be keeping track, but research by Email Monday finds 79% of people surveyed use their smartphone for reading email. Perhaps more interesting is that if the trends hold, sometime next year an estimated 80% of email users will access their email accounts exclusively from their mobile devices. It looks like if you want to communicate with someone using email you will have to make it fit into something pretty small.
A study by Harris Poll finds just over 50% of millennials say they are familiar with their local community banks. That is ok maybe, but it pales in comparison to the 82% who say they are familiar with national banks. At the same time, however, millennials are open to switching institutions, with about 60% saying they are open-minded about using a community bank.
So what can community banks do to better motivate this generation? Well, Harris found 83% of millennials said they would switch banks for the promise of more or better rewards.
Yet another study by Deloitte finds 73% of millennials hold business in high regard. That is good, but large percentages of millennials also remain worried about the motivations of businesses when it comes to ethics or being society focused. Here, Deloitte found 64% see businesses as focusing on their own agenda vs. considering the wider society, 58% say businesses behave in an ethical manner, 57% believe business leaders are committed to helping to improve society and 54% say businesses have no ambition beyond wanting to make money.
No matter your approach, bankers will need to balance all of these things to appeal to millennials and then some. One area for example is around fees. Here, Harris found 94% of millennials pay close attention to the no-fee aspect of things when choosing a bank. Large banks often charge consumers more than community banks do for services such as overdrafts, ATM withdrawals and account maintenance. So, while we've said it in the past and continue to believe that fees are important, be mindful of what you're charging when trying to attract younger customers.
In perhaps an odd twist to all of this research, the Deloitte analysis found that millennials are not very impressed by the "buzz" businesses try to create through social media. Most seek out such things as the quality of products and services (63%), levels of employee satisfaction (62%), customer loyalty or satisfaction (55%). Way down the list is the business buzz at only 27%. It is good to see millennials looking much deeper into what companies are doing and why.
Another interesting fact to consider when courting younger customers is that Harris found 41% percent of millennials stressed the importance of doing their banking at the same bank as their parents or other family members. This is a great reason to leverage existing customer relationships. As you are working with existing customers, remember to seek out their children too as potential future customers that may not yet be on your radar.
No matter the survey, it would seem that millennials are a tricky bunch to satisfy for a whole host of reasons. However, by catering to this younger generation's unique needs, community banks can capture more customers and keep them longer.
Keep your eyes open to the changing demographics of your customer base, answer your emails quickly, and take steps proactively to do the things they expect before you are asked. Oh yeah - don't forget to bring the coffee too.