By Kirill Korniliev
Financial institutions are beginning to fully grasp the banking habits of millennials and are rethinking their customer experience to better engage with a generation that uses their smartphones for everything – the first true digital natives.
Millennials do have financial needs, but their goals are altered by the cultural shifts of their generation – more social, more eco-sensitive, and maybe less focused on accumulating wealth.
Their goals include experiences and contributions as much or more than mortgages and financial planning. They haven’t had time for long standing financial relationships. And when it comes to technology, mobility and convenience, millennials have high expectations that financial institutions will need to fulfill if they hope to maintain relevance with this target market and capture a huge market opportunity.
They care about what peers are doing, they want choices rather than developing loyalty, and they will trust non-banks and start-ups offering new services.
Armed with this knowledge, financial institutions must do more than simply provide a basic mobile app in order to engage with this generation. Unfortunately, many institutions started with a mobile banking experience that resembles a shrunken version of a transactional online experience.
With mobile as the cornerstone for building banking relationships with millennials, financial institutions need to focus on developing a mobile strategy that meets the high expectations for convenience and simplicity with a social, fresh experience.
What are the prerequisites for a millennial-friendly banking experience?
- First, speed and simplicity are required because clients’ attention continues to decrease.
- Second, tech innovation that keeps in touch with the speed of change is important. New features and improving networks have delivered better apps in every industry, and banking expectations can be no different. These apps need to be current, in the same way phone apps and phones themselves change. Updates can’t come at three-year intervals.
- Third, millennials need education. This generation likes to learn – online and in real-time. They typically don’t read the manuals – they learn while using. Apps need to be integrated with usability, and gaming or virtual education, all of which are valid options for learning to borrow, save, and invest.
- A final prerequisite is security. Millennials demand protection and security. While they may share personal details that shock their parents, they value protection for their money but want convenience and speed. They will be early adopters of biometrics and mobile-integrated security. Far from painful, security could and should become a positive differentiator for this generation.
Like every new generation, millennials may not be the most profitable customers but their numbers and long-term relationships are important. A mobility-first strategy – from the front end experience to the back office processes and security – is key to winning this set of customers.
And, by the way, convenience, innovation, ease of use and security are good for every generation of financial services customer.
In short, investments made in mobile millennials can be leveraged across the digital bank for years to come.