Top Five Generation Y Stats and What They Mean for Your Credit Union

Some interesting new Generation Y statistics indicate big changes are on the way for how credit unions think and operate. Taking a look at them now and preparing for the oncoming future could help lessen growing pains and improve member service and retention as this vibrant generation comes into its own in the coming years.
Generation Y encompasses people ages 9-30 (born between 1982-2003).

1. Gen Y users are in love with technology and sharing
According to a recent blog post, over half of Gen Y regularly shares information with friends, family and associates, about products they find interesting. Also telling is that 80% of daily Gen Y activities involve the use of technology. Finally, two-thirds say they will look up a business for further information about it if they see a friend has “checked-in” there using social media tools.

Credit Union Implication
Gen Y loves to talk, interconnect and share. They will talk, vociferously, about product and service experiences, both good and bad, with an ever-widening circle of friends and associates. Think of it as the old word-of-mouth or viral marketing concepts on steroids. Not only must credit unions continue to do a terrific job of providing superior member service, they must also learn to monitor relevant and popular social media and review sites to see what people are saying about them. Make regular Facebook, Twitter and Google keyword alerts your friends as you track these exchanges.

2. Smartphone use will continue to become more important
In case you haven’t noticed, virtually every adult seemingly under the age of 90 is glued to a smartphone most of the day. For Gen Y, it’s even more prevalent. What started out as analog brick-phones with $9.99/minute plans just twenty years ago has exploded into a tool that many people consider more important than having a home PC or cable plan.
A recent report on number-crunching stats for Gen Y puts it this way: over 20% of Gen Y who say they rarely otherwise go online say they do use their smartphone to access the internet. Low income households are even more likely to use their smartphone as the sole means of online access. In fact, only 70% of Gen Y in this category report having a home computer.

Credit Union Implication
If you don’t have a smartphone marketing plan in place now, get one. Is your credit union active on the internet? Great. Now, get to work on the next generation of web access. Gen Y wants smartphone-optimized versions of your website available, as well as mobile banking and apps. Failing to jump onboard now means you could lose their business in the very near future.

3. Gen Y is going to move around a lot – can you handle the flow?
Gen Y, while hard workers, have a decidedly different view on the workplace than their parents and grandparents. According to a 2010 Pew Research Center report, about 60% of Gen Y workers do not feel it is likely that they will stay with their current employer for the rest of their working life. Compare this to 62% of Gen X workers saying they would never leave their current employer and 84% of Baby Boomers with the same thought.

Credit Union Implication
Whether it’s a volatile economy forcing job-hopping to stay afloat or some sort of generation dissatisfaction in general, Gen Y looks to be a group on the go, professionally speaking. Credit unions must expect members in this age group to come and go on a regular basis. This, of course, can have a major impact on your membership stats and bottom line. What are you doing to keep current members? More importantly, what are you doing to attract new members, as the stream of Gen Y coming into your credit union looks to rise and fall like a generational tide?

4. A lost generation in financial education?
While buffeted by the storms of financial uncertainty and global economic upheaval, Gen Y seems to be coming out on the short end of the stick when it comes to financial education. An April 2010 article in USA Today indicates a full 70% of Gen Y workers do not have enough in savings to cover two months’ worth of living expenses. Also, the average Gen Y worker has three credit cards and 20% of those carry a balance of more than $10,000. Last, only around 60% of Gen Y pays their monthly bills on time.

Credit Union Implication
For a variety of reasons, many members of Gen Y seem to lack the basic financial skills and education necessary to carrying on budgeting business as usual in the modern world. What is your credit union doing to help? Can you offer free financial education seminars, either in person or online, on topics like applying for a mortgage, balancing a checkbook or the responsible use of credit? Credit unions that provide such an education to Gen Y may find themselves with not only financially savvier members, but members more likely to stay around, in part, out of gratitude that someone took the time to help them when they needed it most.

5. The rise of the diverse marketplace
We’ve heard of the coming rise of power, financial, politically and otherwise, of minorities for years. That dawning of a new demographic age has landed squarely on Gen Y. According to the U.S. Census Bureau, 20% of Gen Y is Hispanic and 14% are African-American. Other stats indicate similar increases in minorities coming from Asian and Indian backgrounds.

Credit Union Implication
Credit unions must be prepared to handle this growth in minority population. Do you have marketing and advertising pieces readily available in the preferred language of minorities in your area? Are you doing all you can to reach out to minorities using media channels more relevant in their lives? Is your staff and board diverse enough to truly represent the makeup and voice of minorities in the communities you serve? Credit unions that act now to address these concerns take a huge first step in ensuring their continued attractiveness and viability in a rapidly changing member service environment.

Gen Y represents one of the largest, most diverse and most technologically-savvy generations of our times. Credit unions can and must take a hard look at how they are serving, or not serving the needs of this group and plan accordingly. Gen Y, like previous generations, will leave an indelible mark on the very fabric of our society and their importance to the future of the credit union movement cannot be under-emphasized.

Mark Arnold, CCUE, is an acclaimed speaker, brand expert and strategic planner. He is also president of On the Mark Strategies, a consulting firm specializing in branding and strategic planning. Some of the services Mark provides include strategic planning, brand planning, leadership/management training, marketing planning and staff training. His web address is www.markarnold.com and his blog is blog.markarnold.com. You can also contact him at 214-538-4147 or mark@markarnold.com