By John Flynn, CEO, Open Lending
The millennials and Gen Z are about to become half of the workforce, according to a research report from Futurum Research. This same study marks this generation as having more than $2 trillion in buying power by next year. Clearly, this is a market to go after.
These consumers behave quite differently from prior generations. Trust remains the key. Deloitte’s Global Millennial Study reveals that millennials have shifted from optimism to distrust. This generation has come of age in a time of turmoil and radical change (think 9-11, banking crisis, housing collapse and skyrocketing student debt.)
In fact, financial concerns are major points of stress for this age group. There is hope, though; 43% see improvement in the next 12 months and their trusted financial providers can help the rest see the light at the end of the tunnel.
So, what drives these consumers? We want them to be loyal, but they want loyalty on their terms. This younger group has grown up online and spends significant chunks of their personal and professional lives there. Your credit union or community banks must be there as well. Millennials still visit brick and mortar locations but do their homework online first.
To be successful with this segment, your institution must embrace technology and provide the information for existing and potential members and customers to find online. Many will research online before actually purchasing, so make it easy for them to find the information they need. When finances are stressful, provide the tools and education to help take the stress out of your interactions with them. Provide them educational tips in your applications and websites, make it easy for them to access, manage and move their money, and provide solutions when times are tight.
Here’s how your financial institution can successfully reach these young borrowers who sometimes are turning to nontraditional lenders:
Provide educational tools for them to monitor their financial well-being
Find ways to offer better solutions that fit their individualized needs - Open Lending can help you say yes to more loans for young borrowers with thin credit files!
Provide refinancing options that can help lower their monthly bills and move more of their business to your credit union or community bank
Ensure information is readily available to customers on digital channels
Make sure your website and mobile app are easy to use and navigate
Remember, it’s about listening to and understanding your audience, which is not always their actual words but their actions. If they live on their phones, that’s where you need to be to grab their attention. Addressing these valuable members may only be a few clicks away.