Catching up with Gen Z

As credit unions’ marketing guide books on attracting Millennials haven’t even been put down yet, the go-getters of Generation Z are sliding into their first jobs and bringing hundreds of billions into the American economy.

Gen Z is ready to do business, and according to PYMNTS intelligence data, 95 percent of credit unions are in hot pursuit of those prospective members. The difference, however, between Gen Z and earlier generations of consumers—possibly apart from tech-savvy Millennials—is that Gen Z has spent their early lives understanding the now-abundant concept of “choice.” The idea of brands campaigning for their every dollar is like your average Tuesday for Gen Zers.

That new reality makes Gen Zers an adaptable crowd. For example, in the past year, 42 percent of Gen Z credit union members switched their primary financial institution. In fact, to put that switch into perspective, a PYMNTS research study found that Gen Zers are 2.5 times more likely than their Gen X forebears to have switched financial institutions in the past year, while less than four percent of Baby Boomers and seniors did the same.

Their high turnover rate only encourages the idea that Gen Z has high expectations from their financial institutions. In fact, that same PYMNTS report, in collaboration with Velera, discovered what Gen Zers really want are innovative and forward-thinking products and services. When a given financial institution comes up short in this area, those young, digital-first consumers see no issue moving their accounts to institutions that have those features and qualities.

If credit unions are truly determined to entice Gen Z consumers, they need to have a clear and innovative strategy to success, and it has to be one formatted to attract and, most importantly retain, young members for the long-term. That means getting serious about enacting a digital transformation campaign and seeing it realized.

Meeting Gen Z’s innovative digital banking demands

To entice this new generation, credit unions should consider incorporating the following strategies into their digital transformation efforts. With assistance from Equifax, we offer three ways to accomplish that goal below.

Offer a fluid, easy, and accessible digital experience

This new generation is the first to have grown up with digital communications and technology being a central part of their lives. They are inherently capable of accessing the information and services they need quickly through their smartphones. With that in mind, it’s vital that credit unions onboard the mobile banking platforms that are easy-to-use, convenient, and secure for members. By embracing the digital banking experience and its innovative solutions, credit unions can not only streamline their organization’s operations but enhance the member experience to meet the digital expectations of today’s younger, tech-savvy consumers.

Building trust and transparency

Transparency and trust only grow in importance when credit unions cultivate relationships with potential Gen Z members. Cooperatives must communicate openly and transparently about fees, unclear policies, and financial products and services in order to build credibility. Programs that focus on financial education, literacy, and public outreach can only increase that level of trust while fostering loyalty.

Create personalized experiences while emphasizing convenience

Gen Z needs and expects financial institutions to understand and fulfill their needs while providing them the digital experience and functions they want. Using the right data and solutions, credit unions can offer a truly personalized experience; each interaction tailored to each member’s financial needs, goals, healthy habits, and preferences. 52 percent of Gen Z would switch financial institutions if lower fees were offered. This specific finding alone offers an immediate angle credit unions can use already to attract potential members.

This generational difference in banking services sharply illustrates what credit unions, and financial institutions overall, need to achieve in order to meet the needs and goals of this next era of credit union members. That includes their healthy appetite for innovative concepts, products and digitally-focused features. The industry has already experienced their all-too-willing ability to switch financial services providers.

And by doing that, they’re outright telling you that the new feature you’ve been dragging your feet on implementing can’t come soon enough.