San Francisco, CA, USA
July 12, 2007The Millennials, Financial
Services, and the Web
Report Published by Celent
The college-bound “Millennial”
generation born between 1982 and 2000 will represent the next mass
affluent group. Financial institutions will need new marketing approaches.
The race to attract Generation
Millennial (Gen M) has become increasingly important since this group is
not tied to longstanding financial relationships. By reaching out to the
college segment, financial institutions can add new customers very early
in their financial life cycle, which helps build loyalty. As members of Gen M
age,
they will have increasingly sophisticated financial services needs and
will often look to their existing financial institutions for new services.
So attracting this group early is key.
In a new report, The Millennials, Financial Services, and the Web,
Celent reveals the opportunities in Gen M for insurers, investment
providers, banks, and card issuers. According to the report:
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Overall awareness of
financial products and services has grown over the last few years in
the Gen M group.
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Gen M highly values remote
channels, such as email, Internet, and mobile phone.
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Checking accounts and
debit cards are still the most pervasive products for Gen M.
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Gen M uses debit cards
more frequently than other payment forms and for lower dollar values
than other age segments.
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Investment by financial
institutions in the Internet channel can pay off handsomely.
“GenM is the first
generation to grow up online and to grow up without the need for a
landline phone,” says Dan Schatt,
co-author of the report and senior analyst at Celent. “Given the
ubiquity of mobile handset adoption and internet usage among college
students, banks that want to tap into this demographic will have to invest
heavily in the mobile and web channels, the number one preferred way for
this segment to communicate and obtain information about financial
providers.”
At the same time, Gen M
continues to look to one of the most traditional channels out there for
information about providers: their parents. “Parents remain one of the
top influences on Gen M’s choice of provider, particularly for
insurance,” says Ashley M. Evans,
co-author of the report. “Financial institutions that can mine their
databases for customers with college-age children have an opportunity to
market to young consumers through one of their most trusted channels.”
The 36-page report has 23
figures. A table of contents is available
online.
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