Many community financial institutions have struggled to attract younger consumers. While big banks have emphasized their technological innovations to win that coveted demographic, there’s a misconception that there’s no room for smaller institutions to take advantage of the market. What tools can you use to draw the customers you want? Consider an overall marketing approach.
There are many different ways to reach younger customers, and balancing all of those options can be challenging. Young potential customers are, of course, digitally connected (or in many cases “tech dependent”). Community-based institutions should establish a strong online presence and take advantage of the brand-building opportunities that digital channels provide.
Online Advertising. Building awareness is a first step to forming a relationship. Google display advertising, which uses banners, can be considered print ads. They help create awareness with large numbers of impressions while still delivering “click-throughs”. Gen Y customers also rely on social media networks to learn about banking services, and the national banks harness successfully that power. CFIs can use social media to generate buzz and give their strongest champions a voice.
Search Engine Marketing. Critical for delivering promotions and connecting with customers who are in the market for a specific product or a new financial relationship. Features associated with SEM also offer the capability to closely track campaign success with strong analytics.
Refine and Polish Your Website. Many smaller institutions are confident that if a prospect walks into a branch they will walk out a customer. Not so many have that same confidence in their websites. Many websites were not designed to convert visitors to customers. Additionally, the majority of websites don’t work well with smart phones or tablets, where many customers – especially the younger set – do the majority of their research and even buying! PWM strongly recommends that CFIs design a responsive website that focuses on customers’ need for information about products, give them the ability to ask questions online, and support the website with helpful tech support. Savvy younger customers value a first rate customer experience, and it often starts before any face-to-face meetings.
Online Account Opening. In general, most young men and women are comfortable with online account opening. According to Andera, a provider of online account opening technology, customers using online account opening are much more likely to be younger and more affluent. Providing online account opening is one way to increase the likelihood that younger customers will feel comfortable doing business with your institution. Websites without online account opening still can be successful by strongly emphasizing calls to action and clearly communicating how potential customers can make contact.
Fundamental Value Proposition. Younger customers want to know what’s in it for them. Your bank or credit union’s long history and generous support of local organizations will be unlikely to have an impact on younger demographics’ decision to open accounts with you. Focus on convenience, value and solving problems. In many cases, younger consumers place value on different aspects of products than older segments. Free checks aren’t important (remember: younger consumers are digitally connected), but free ATMs or some type of debit card usage reward could seal the deal. Interest rates also don’t have the same value to younger demographics as compared to a younger demographic compared to an older group. Selective Fee Forgiveness is another way to enhance products to provide value. Look at your inventory of products and services and highlight the ones that would be most effective for drawing young customers.
Getting younger customers is a dynamic process, adapting to the rapidly changing habits and needs of younger customers. It starts with thinking about how you can reach them, then ensuring that you are meeting their needs and offering them value. There is no silver bullet but there is a silver lining. As you successfully communicate with younger customers at an earlier stage of their earning curve, you will have a far better opportunity to retain them throughout their life stages. As an added benefit, there are many older consumers who — like their younger counterparts — are technologically dependent. As your strategy to attract a younger demographic takes hold, you may also reap the benefit of earning the business of that older demographic.