With millennials making up roughly a quarter of the world’s population, it’s not surprising that they’re shaking up traditional industries.
While it’s hard to determine whether millennials earn more than previous generations, research from the World Data Lab reveals they're quickly increasing their spending power to become one of the world’s most influential consumers.
So, how exactly will millennials shape the world economy and organizations working in the financial sector?
Fueling the Fintech Revolution
Millennials grew up alongside technology giants like Apple and Google, making them one of the most tech-savvy generations. They’re also not afraid to use technology to make complex decisions -- even financial ones.
Envisionit research into millennial’s financial attitudes shows:
— 68% of millennials think how we access money will change in the next five years.
— 73% would be more receptive to financial services from tech companies like Google, Apple, PayPal and Amazon than their own bank.
— 33% believe banks will cease to exist over the next five years.
With such disruptive and encouraging attitudes, millennials are easily powering the fintech revolution and making way for start-ups to radically change a rather stuffy and traditional industry.
Ditch the Old-School Approach
Most millennials were entering university or the workplace during the 2008 economic crash — so they became adults in a world full of financial instability and were old enough to understand the role bankers played. As such, it’s not surprising they struggle to trust large banks.
Envisionit research shows that only 28% of millennials would prefer to use a traditional bank, and only 13% don’t trust finfechs.
Online investment platforms like Acorn are popular among millennials who want to keep track of their investments without a traditional stockbroker, while apps like Moven provide personal, down-to-earth money coaching.
Debt plays a large role in how millennials view their finances; especially since the average American millennial has $36,000 in personal debt and only 20% don’t expect to die in debt, according to Northwestern Mutual's 2018 Planning & Progress Study.
As a result, they don't want a lecture on their poor money habits or the fact they're drowning in debt. Instead, they want straightforward, non-judgmental financial advice so they can control their situation and become more financially savvy.
Three Ways Fintech Companies Can Market to Millennials
1. Don’t judge. Millennials who are struggling with their finances don't need to be told where they went wrong. They want tools and advice for getting out of debt and investing in their future.
2. Responsive, quick services. Websites and mobile platforms need to be optimized with fast load times and easy navigation, since this tech-savvy generation won’t tolerate outdated tech.
3. Make it easy. Piles of paperwork and unnecessarily lengthy processes are non-starters for millennials. They’re quite receptive to robo-advisors, online financial advisors that let millennials determine the amount of risk they're comfortable with and increase or decrease their investments accordingly. So this can be a great way to streamline services and ensure you’re available 24/7.