Indeed, a survey of 450 millennials by the newly launched Catalyst Pro Group found a number of surprising banking behaviors that run counter to the growing narratives about individuals between the ages of 18 to 35: mainly, that all of them hate banks and prefer nonbank products, and if they do use a bank, all of them are strictly digital creatures.
In the report, “Millennials & the future of banking: What banks need to know about this digitally precocious generation to prepare for the future of banking,” Catalyst Pro Group analyzed the responses of 450 individuals who completed a survey administered through AskYourTargetMarket.
Respondents answered a series of questions about their banking actions, habits, behaviors and needs. The last question was designed as a storytelling exercise to elicit deeper insights from the millennials. The open-ended question asked them to consider the year 2035, and define and describe their desired banking experience and what their bank of the future will be like.
While the responses confirmed the notion that individuals born between 1980 and 2000 have made their presence felt as the most disruptive generation in history, Catalyst Pro Group’s survey also paints a slightly different but intriguing picture for banks to digest.
Bottom line: banks should respond to the challenge of attracting millennials as customers by looking past sweeping generalizations about the group, and examine deeper dives about their actual behavior – as well as their expectations for the future of banking.
The results suggest that the manner in which banks and credit unions sell financial services — and what they actually sell — may have to shift considerably in the years ahead. Still, as services become more technologically advanced and some even automated via artificial intelligence, millennials report that they still expect a human connection when they need it – including face-to-face interactions at times.
The banks of today will need to think through their business strategy to prepare for banking in the future with this generation. Catalyst Pro Group’s research on millennials provides four key areas that banks will need to focus on to create an ongoing relationship with the millennial banking customer: advisory, education, enhancements and accessibility.
Developing these strategies now is critically important, as this age group will soon dominate society more than any other generation, due in part to its very disruptive nature, and also because of its sheer size. According to the Census Bureau, there are 75.3 million millennials as of 2015, making the group the largest U.S. generational population — outnumbering baby boomers and Gen X.
Banks that take the time now to get it right will be in a better position than their competitors – including nonbanks — to lure millennials. The trick to cracking the nut is to truly listen to what the young generation wants, particularly those who live and work in a bank’s own community. The effort could very well pay off in huge dividends for decades to come.
The Catalyst Pro Group is a forward-thinking research lab created to provide a unique, stimulating and engaging environment to produce new ideas and innovative thinking. The concepts formulated by the lab are intended to educate banks and fintechs on the forces of disruption and transformation and to produce a roadmap for their future. Catalyst Pro Group offers mid-tier, community, and regional banks, along with fintechs, an environment to discover and inspire business strategies that will serve as a catalyst for change that could help institutions not only survive, but thrive.
Click here to purchase the study: Millennials and the future of Banking.