Credit unions know that appealing to Gen Y is essential for membership growth in 2012, but too few are successful at it. Perhaps the reluctance to focus marketing to Gen Y lies in how different and somewhat complex they are as a generation compared to their older predecessors.
What credit unions must recognize is that many in Gen Y are educated, absorb new information quickly, and are entrepreneurial. In addition, they are socially aware and contribute to their community by exchanging information with one another. To effectively resonate with this demanding generation, credit unions need to regroup and apply the following approaches:
Gen Y's combination of attributes makes them a challenging market audience. Financial institutions that erroneously bullet toward the direction of technology-being completely hands-off and impersonal-may come across to Gen Y as too sterile and insincere. An effective way to address their need to be recognized as individuals is by offering products that promote personalization.
For example, at one point I considered closing my credit card account and had even let a year pass without running a transaction through it. The institution tried its usual round of incentives like, lowering my interest rate and increasing my limit. While these gestures were nice, my interest rate overall hadn't changed that dramatically and I had no use for the extra limit now available to me. Then, the credit card company began offering customizable credit cards online. I went onto their website, spent two minutes sifting through my photos, and submitted a picture of my dog, Bailey. Once I received my new card in the mail, I actively showed Bailey off without hesitation and my account transactions were immediately revived.
Expectations About Convenience
As online banking gains popularity, many Gen Y's expect the same conveniences from a credit union. Options such as opening an account online, paypass cards and bill pay have become a normal practice for Gen Y's. Brass Media suggests that Gen Y members without automatic bill pay have about $10,000 less on deposit than Gen Y's who have bill pay capabilities.
Gen Y developed a knack for speedy communication through social media outlets such as Facebook, Twitter YouTube and LinkedIn just to name a few of the social juggernauts. A good or bad experience with a customer/member service representative can get shared to thousands of people in just a couple hours. Gen Y's have integrated information sharing into their daily lives, which makes these social networks prime real estate for credit unions to put their best foot forward.
As with financial products, Gen Y's are interested in a personal experience. A common mistake that financial institutions make is simply spamming social network pages with automated messages and promotions. The key to capturing the attention (and loyalty) of Gen Y is to engage and be genuine. Create a poll about how much they plan on spending on holiday gifts, or pose a question encouraging their feedback on a product in development.
Gen Y and Credit Union Profit Potential
In addition to increasing membership count among credit unions, Gen Y's innovative spirit makes them more inclined to open a new business or invest in an existing business; thus, creating more demand for business accounts and services. According to research conducted by Brass Media, Inc., Gen Y influences $324 billion and is expected to inherit $17.8 trillion.
One more point it's necessary for every credit union to recognize: adding a couple extra online services may not be sufficient enough to secure the allegiance of existing and potential Gen Y members. However, by crafting your message to their individual needs and values credit unions can target a fresh market that provides additional benefits and opportunities in tow.
Jennifer Calonia is Junior Editor and contributing writer with www.GoBankingRates.com.