Younger customers know what they want and won’t wait around for firms to catch up
Younger consumers are less likely to stay with their financial services provider than older generations.
While many older customers may stick with their current bank or other financial services provider because it’s what they are used to, younger consumers want to be engaged by the companies they use.
A new report from Yes Marketing shows that 40% of 18-21 year olds say they are considering leaving their current financial services provider, as are 35% of 22-37 year olds.
"With the rise in peer-to-peer services and fintech startups, consumers now have more options than ever when it comes to selecting a financial services provider," said Jim Sturm, president of Yes Marketing. "This trend, combined with consumers' likelihood to stay long-term with the financial provider they selected, demonstrates how important it is for financial brands to have effective acquisition strategies that engage and build trust with new customers as they progress along their journey."
But the demand for digital financial services is not restricted to the youngest consumers; 42% of Gen Xers also say that say the ability to manage services through a mobile app is a top 3 factor when considering new financial services companies. This compared to 37% of Millennials and just 18% of Baby Boomers.
Trust in protecting their personal information is also in the top 3 decision-making factors but more so for older consumers.
While this was important for just 14% of consumers aged 18 to 21 (Gen Z) and 19% of consumers aged 22 to 37 (Millennials), it was a factor for 34% of consumers aged 38 to 52 (Gen X) and 47% of consumers aged 53 to 72 (Baby Boomers).
"In today's highly competitive and crowded financial services landscape, the pressure is on for all financial institutions to demonstrate their value to consumers through high-quality services and data-driven content," said Michael Iaccarino, CEO and chairman of Infogroup, parent company of Yes Marketing. "Financial institutions must identify the right service and technology partner to deliver relevant and engaging content that meets evolving customer expectations and creates strong brand loyalty to maximize customer lifetime value across generations."
More than two-fifths (42%) of financial services consumers say they rarely or never receive relevant marketing communications from financial services companies they've used before or are currently using.
Nearly a quarter (22%) of consumers say they hear too frequently from companies across channels, while 8% say they do not hear from those same companies often enough.
Copyright Bloomberg News