Why Adopt a Digital Customer Acquisition Strategy? One Word: Millennials

According to research by  Fair Isaac, 52% of consumers ages 18-34, aka the ‘millennials’, are already using or very likely to use non-traditional payment companies like PayPal or Venmo in the next 12 months and 18% are using mobile payments like ApplePay. These digital natives are highly engaged with technology and show a keen preference for researching and conducting transactions online. This highlights millennials’ generational preferences to conduct transactions digitally – including banking transactions. 

Banks have an uphill battle, though, in capturing millennials’ hearts and minds. According to the Millennial Disruption Index, banking is the industry with the highest risk of disruption when it comes to millennials.

  • 53% of millennials don’t think their bank offers anything different than other banks.
  • 71% would rather go to the dentist than listen to what banks are saying.
  • 1 in 3 millennials are open to switching banks in the next 90 days.
  • 33% say they won’t need a bank at all.

The Bank of New York Mellon (in association with the SAID Business School and University of Oxford) surveyed over 10,000 millennials and found that:

  • 40% of millennials prefer to interact with their bank via their website or email.
  • Only 23% want to meet face-to-face with their bank in a branch.

3 Keys to a Building a Winning Digital Customer Acquisition Strategy

This is a wake-up call for banks who hope to survive for the next few generations. Where can banks start in building stronger relationships with millennials?  Much of it starts with implementing a digital customer acquisition strategy that embraces mobile technology and sending millennials customized communications that are relevant to their concerns and needs.

  1. Be sure your communications are relevant. 46% of millennials say their primary bank doesn’t send marketing materials relevant to their future plans. Banks need to take advantage of the rich transaction and life stage information they possess to make relevant offers to millennials. This starts with managing the customer and not the account, by connecting the dots across your bank’s internal silos. Doing this well represents a huge opportunity for better customer engagement with millennials.
  2. Ruthlessly eliminate transaction inefficiencies. Any digital customer acquisition strategy needs to not only support mobile devices, but also eliminate inefficiency. Millennials are ‘impatient consumers;’ they expect data and information to be available on demand and want the ability to self-serve where appropriate. Improving your digital capabilities to resolve these issues will lead to better quality interactions with millennials while reducing wasted time. This will ultimately lead to more engaged and happy clients.
  3. Don’t confuse mobile account openings with online account openings. Most millennials will find it too cumbersome to complete an application on a mobile phone that was designed for viewing on a PC or laptop. Offering millennials an optimized experience for mobile is critical – and it’s not as simple as merely re-purposing the forms on your website for mobile. For instance, completing transactions on smart phones is all about speed. Therefore, minimize the use of keyboard input by utilizing drop down lists and toggle/radio buttons.  Also minimize white space and use adaptive design to eliminate unnecessary images/graphics when rendering on a smartphone.  

Don’t Miss this Huge Opportunity

Creating a digital customer acquisition strategy offers significant market opportunity for banks that embrace and commit to mobile. There is plenty of room for growth in all mobile banking categories especially as millennials —who instinctively use their mobile devices for transactions—begin purchasing banking products. Case in point: banks that support mobile ‘Apply Now’ experiences often see more than 40% of all applications for new consumer banking products coming from mobile devices.

Don’t wait until your millennial customer base moves to another financial institution that better understands and services their needs. Get started today building your digital customer acquisition strategy.

Don Bergal
Don Bergal

Don is CMO, building and leading worldwide marketing at Avoka. He has a successful 25 year record of growing technology businesses in marketing, operations, and sales management, particularly with early stage and high growth companies.

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