Regardless of your brand's characterization of tech-savvy up-and-comers, the fact remains that they are your financial institution's next potential members. According to CNBC, millennials – born between the early 1980s and early 2000s – will rake in more than $8 trillion per year in net income globally, creating unmatched buying power and the need for credit unions that want to be successful to appeal to this market.
So how do community-based institutions engage with this group of globally-minded consumers who require high-tech convenience? At United Heritage Credit Union, we've found these tenets to be the keys for success.
Meet New Financial Needs
We're fast approaching an era in which the term "checking account" has very little relevant meaning. As technology gets better, fewer and fewer young adults will ever write a check to pay bills, opting instead for the convenience of debit, online and mobile transactions.
Accounts with debit cards and access to online banking now come standard, but these are only the starting points for meeting the financial needs of digital mavens. Today, a debit card must meet the technology and fraud prevention standards of your institution as well as global merchants. Online banking must be accessible whenever and wherever it's needed. If you haven't introduced a smartphone app to your members, then they must be able to access and use your online banking portal through a mobile browser.
Such account accessibility is required for most young adults to even consider joining your credit union, and it's only the minimum. Your marketing and product development teams should work to better understand not only what young adults need from your institution, but also the ways they want to interact with your institution to meet their needs. A small investment in a focus group to learn how your members will take advantage of new digital features or technologies could work wonders for your member relationships in the long term.
Meet New Lifestyle Needs
Banking looks very different than it did just a few years ago, and it continues to evolve at a fast pace. Digital transactions are the new standard, and financial safeguards such as deposit holds – while required in many cases – are often perceived as an interruption to daily life.
We cannot expect our institution's regulations and requirements to meet the expectations of a generation accustomed to same-day delivery service, nor would it be in our best interest as financial stewards. In order to facilitate the needs and wants of this target group of new members, it is important to ensure they know exactly what's happening to their money and why.
Last summer, United Heritage CU teamed up with the Long Center for the Performing Arts in Austin, Texas to host the All Summer Long festival.
A three-day check hold is a measure a financial institution takes to ensure a check is not fraudulent and the funds are available. If the reasoning behind a check hold is explained to members in a face-to-face setting, they are generally understanding of the speed at which the funds are posted. However, moving the check deposit process to a digital environment means placing the fraud mitigation and due diligence behind the scenes, so it's not always evident to members why a transaction may take several days to clear an account.
The best practice is to over-communicate your policies and procedures to members, especially young adults who may not be familiar with in-branch transactions. Have transparency in your operations and inform members why transaction regulations such as check holds are in their best interest. Your social media team and contact center will appreciate it.
Meet New Social Needs
If the endless research on young adults has taught us anything, it's that they often value experiences above all else. They care deeply about what matters most to them and are loyal to brands that reflect their values – creating a unique opportunity for local, not-for-profit financial institutions to engage with this target demographic.
United Heritage is headquartered in one of the nation's trendiest capitals – Austin, Texas. As a city known for its live music and technology sector, it's no surprise Austin's young adult population has grown exponentially over the last decade.
The All Summer Long festival featured local food, entertainment and outdoor activities, including a United Heritage CU photo booth.
Austin-born and Austin-bred, United Heritage understands the lifestyle that attracts people to the city better than any global bank, and we've found success in meeting potential new members where they spend their time to celebrate life. Our brand is present at Austin staples like the Austin City Limits Music Festival and the Long Center's All Summer Long events, and the community takes notice.
Value-based marketing is a track that many companies have begun to pursue over the past few years, and credit unions are poised for success in this arena. As companies founded by and for the people we serve, credit unions have an authentic understanding of the people in their respective communities, what they want and how to give it to them.
Kevin Farley is assistant vice president, digital and brand experience, United Heritage CU. He can be reached at 512-435-4545 or [email protected].
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