August 30, 2016
With millennials comprising over a quarter of the US population, companies across industries are turning their priority and attention to creating products which can cater to this group with its lifestyle hallmarks. In addition to extensive representation, this group has influence over $600 billion of indirect spending, primarily because teens and young adults influence the purchasing habits of their parents. A demographic as a powerful as this has a certain effect on the direction of the financial services industry’s development as they represent the future, the opportunities and all the benefits that come with them if leveraged intelligently.
Affection towards innovative solutions and mobile technology, in particular, has led startups to tune their business models to cater this special group. Banks as well have realized the importance of pivoting efforts towards this group and have started investing heavily into mobile banking to be able to compete with mobile-only challenger banks.
Millennials are multichannel bankers, but mobile is of the highest priority (49% of millennials prefer banking through mobile).
A report by Facebook published earlier this year suggests that millennials are multichannel bankers. The ability to engage across any preferred and the most convenient channels to solve an immediate problem is extremely important to this part of the population.
However, it appears that across the means of communication and channels, mobile is of the highest priority. For millennials, smartphones have become the extension of their hands. In fact, mobile phones are such an important part of their lives that 77% of millennials have reported to always have their smartphone with them. Through mobile, millennials are reported to discuss and manage finances and connect visually.
However, mere knowledge of the preferred channel is not enough to establish a meaningful connection. What is it that millennials want from banks? Salesforce tried to find an answer and break down relevant expectations the generation has from banks in its recent report.
Findings suggest that 75% of millennials are at least somewhat reliant on a mobile banking app to interact with their bank for tasks such as depositing or sending checks, checking their balance and paying bills. Hence, it's important for banks to offer robust mobile banking solutions.
Given that smartphones have become an extension of a hand, a reliant mobile banking app is one of the most important points of interaction with financial institutions. In fact, over one-quarter (27%) of millennials are reported to be completely reliant on mobile banking apps.
Millennials expect zero delay in communications—whether from a friend or a company they’ve entrusted with their business. They also want two-way communication with their bank in whichever channel is most convenient for them.
The findings suggest that mobile occupies two of the top three ways that millennials want to receive alerts from their banks with 30% preferring to receive an SMS and another 28%—push notifications to their mobile app. As for e-mail, it is still considered a primary channel for receiving notifications from banks—58% of millennials chose email as a preferred communication channel.
When it comes to promotional offers, e-mail is the primary channel for winning business with millennials: the study found that 66% of the group prefers emails when it comes to receiving promotional offers or regular communications that are not time-sensitive from their bank.