Preface: Millennials are an important market segment to all financial institutions. I like millennials. I see them everywhere. I work for a company that employs them. I call some millennials my friends. My daughter considers herself a millennial, but she was born in 1998, so depending upon the definition you prescribe to, she may have missed the millennial boat.
Not a day goes by that I don’t read an article about the importance of millennials to the financial services industry. It seems like plenty of credit union executives are mesmerized by them and hopeful that chasing them like a wolf that smells fresh blood, will woe them in the doors. OK, I get it, you want the growth and you want a younger membership base. That’s fine in my book, but let’s try to keep some perspective.
Here are some of my random thoughts on the millennial craze.
- We were all young at one point and typically a “new generation” befuddles the older. Remember hippies? They were going to change the world. Is the world better now than in 1969?
- 55 percent of millennials are influenced by cause work when deciding to join a company. Meaning and mission seemingly play a role in their employment choices. That doesn’t mean they don’t care about money. They do. Given a choice, we all would like to do something that makes the world a better place. A good place to start is with a regular paycheck.
- Those born at the ends of generation groups are remarkably different and actually more like the prior or next generational cohort. This is true of any generation. For the record, I’m a young Boomer.
- Some say that focusing on millennials might neglect the need for customer retention. This is detrimental because typically for a business, 80% of future revenues comes from 20% of existing patrons (members).
- Millennials started to enter the workforce when the housing bubble burst and underemployment was as big a problem as unemployment. Perhaps they saw parents net worth decline and financial hardships fall upon them. But then again, Boomers and Gen X have certainly been through some hard times as well. I’m pretty sure post depression kids became Boomers, now the wealthiest market segment.
- Some pundits say millennials are “cheap.” I question such thinking, as does Starbucks, Lucky Jeans, Apple, American Apparel, BMW and other “not so cheap” brands that are remarkably popular with millennials.
- Millennials approach brands with a desire to learn more, and can learn even more via technology. I don’t think they are shopping “cheaper,” but rather, shopping “smarter.” But then again, so does my 89-year-old father. Technology enables us all to shop smarter.
- Millennials don’t like to stand in line. Hello. Nobody likes to stand in lines. All your market segments want less friction and added convenience.
- Every market segment needs a financial advocate, not just millennials.
- Personally, I think the very term millennial has marketing-ploy written all over it.
I’m not here to rock the boat and tell you attracting younger members isn’t important. However, it’s important to keep these points in mind so wet don’t fall for sweeping generalizations. And we can’t forget the generations that came before (or are now coming after) the millennials. Credit unions should always be evolving and finding new and better ways to stay relevant to all the markets they want or need to serve.