I want it all and I want it now: banking on the future
Generations X and Y will dominate banking and finance for the next decades with their share of financial assets. At just 36 percent in 2010 their financial assets are estimated to jump to a 70 percent share in 2030.
For Gen Y this is just the beginning of a 30 to 40 year experience as they enter the work, spend, save, borrow, invest pipeline.
The question is, how can banks best position themselves to secure this generation as they grow older and their needs evolve?
It is no surprise that digital channels rule for this generation. A highly sophisticated digital experience is the expectation. Anything less is just not good enough.
They are a generation encapsulated by the Queen anthem, I want it all and I want it now. More importantly is they also want it ‘free’. They are a generation without strong loyalty to financial institutions and will move, or simply hold multiple banking relationships if there is a better or more attractive offer that meets their needs.
Digital natives, online and mobile banking are their primary channels.
In our recent analysis of 1400 young professionals, 98 percent prefer to use digital channels for day to day banking. With the only exception being a home loan, where 79 percent visit a branch. It seems that Gen Y still prefer the face to face experience of a branch when they reach this important financial milestone. Perhaps if there was a sleeker fully digitised end-to-end mortgage process then Gen Y would use it, but this would need to be designed with and around customers and be able to provide the same reassurance that a face to face interaction provides.
Since digital is the preferred option to research and choose financial products, banks will need to make themselves and the benefits of choosing one bank over another more ‘discoverable’ in their online world. The bank’s digital profile is increasingly more important to these digital natives.
This generation grew up with search engines at their fingertips and know how to rapidly search for offers that best meet their needs. To be more easily discoverable, banks will need to employ search engine optimisation, search engine marketing and social media marketing while user experience design and the quality of online content will be more important in driving customer engagement and conversion, Including product finders, feature comparison and social reviews.
Young professionals will comprise a significant portion of the key financial services profit pools of the future, and they’ve told us their needs are not being well met by the banking community today. Ultimately it will take a leap of faith if banks are going to get it right.
Banking on the Future. The expectations of the Gen Y professional is based on research conducted by KPMG of 1,400-plus of their own employees aged between 18 and 30 years.
Kristina Craig is one of them.
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