Study: Industry Should Focus On Millennials
Engaging Millennials is key for the future of investment services, according to a study from Mintel Comperemedia.
Although the economic tide seems to be turning, three cultural trends are heavily affecting the financial services investment industry: Millennials, trust and choice. These three trends are having an impact across all financial services firms, according to Chicago-based Mintel.
A lack of trust continues to be a challenge for financial institutions, as only 28% of Mintel respondents say they trust the financial services industry in general and 43% trust their bank to do what is best for their customers. Since consumers are wary of the motives of these companies, much of the trust that many brands enjoyed over decades has eroded, and that will have to be re-earned.
Banks and other financial services companies need to concentrate on rebuilding their images, said Susan Wolfe, VP of financial services at Mintel Comperemedia.
The takeaway for marketers is they should consider courting customers at an earlier point in their investing life, Wolfe tells Marketing Daily. "Firms that do this are making an investment in the investors of the future," she says. "By creating these early relationships, firms can create strong loyalties, creating long-term customer relationships."
ING is doing a fantastic job of reaching Millennials, she adds. "This is partly because the firms' infrastructure was set up from the beginning in a way that would naturally attract a younger investor," Wolfe says. "In other words, the Web site, the technology and the tone the company takes in its marketing are all more attractive to a younger investor."
Millennials, which the survey defines as those 22 to 35, are growing up in a much different world from that of their predecessors. Investment firms typically ignore this younger group, but they are living through a recession and it will likely change the way they see the financial world. The recession has created a frugality and a conservative approach to investing among this group that they are likely to carry with them throughout their lives.
Over half are already concerned about having enough money to retire. Meanwhile, nearly four in 10 Americans in the Gen X, Baby Boomer and Swing Generation groups say they don't think they will ever be able to retire.
Most surprising of the results is how the recession is impacting Millennials' savings and investing habits, Wolfe says. "Not only are they worried about retirement, but they're indicating that they are doing something about it by saving more."