Monday, August 11, 2014

Pray For the Baby Boomers

Let's face it, baby boomer leaders have it rough. Many companies are led by baby boomers in their 50s and 60s with a growing employee base consisting of those damn generation Xers and Yers. You know .......... the Millennials. "We just don't understand those people!" 

Did you ever read the book, Men Are from Mars, Women Are from Venus? When is John Gray going to write an update, "Baby Boomers are from Earth, Millennials are from Another Galaxy?" All kidding aside, the world has changed immensely over the past 25 years and many community and regional bank's and credit union's executives have struggled to keep-up and catch Millennials attention. 

The 18 to 35 age bracket, collectively known as Millennials, now make-up the largest age segment of our population, passing the baby boomers. If you don’t have a plan to meet their banking needs then your credit union’s or bank's future looks bleak, because there are plenty of traditional and emerging non-traditional financial service providers that will. 

What are Millennials looking for from their financial services provider? Millennials want their banks and credit unions to provide the same kind of customer experience that they receive through more agile consumer technology companies they rely on in other parts of their life. They are looking to manage their personal financial lives in the same way they manage their digital and social lives. Right now, with some exceptions, non-traditional financial service providers are building superior offers.

Just in case you have been sleeping here are some more facts about Millennials according to the Millennial Disruption Index study:
  1. 71% would rather go to the dentist than listen to what banks are saying
  2. 1 in 3 are open to switching banks in the next 90 days  
  3. All 4 of the leading Banks are among the ten least loved brands by Millennials
  4. 68% say that in 5 years, the way we access our money will be totally different
  5. 70% say that in 5 years, the way we pay for things will be totally different
  6. 33% believe they won’t need a bank at all
  7. Nearly half are counting on tech start-ups to overhaul the way banks work
  8. Millennials believe innovation will come from outside the industry
  9. 73% would be more excited about a new offering in financial services from GOOGLE, AMAZON, APPLE, PAYPAL or SQUARE than from their own nationwide bank
Credit unions and banks should focus on service as an engagement route with their younger members. An omnichannel strategy designed to deliver a low-effort seamless member/customer experience across all interaction channels. Best-in-class mobile and web solutions, as well as simplified, transparent products all support this direction. 

Another buzz word in omnichannel banking is "seamless experience". What the heck is a seamless experience? Despite the required breaking down of banking silos, hand-offs between channels or people within the credit union or bank will continue to occur. When they do, members and customers don’t want things falling through the cracks or to have repeating their problem multiple times.

As +Ron Shevlin from the Aite Group  says, "consumers want things to work. Period. But if you must elaborate, they want things to work the way they expect those things to work, when they use them, and where they use them. And consumers don’t want to have to think about any of it. They just want it to happen. If you really think about it, what they really want is for banks to be invisible." Combine simplicity and low effort with Mr. Shevlin's comments and you have the definition of a seamless experience. 

I hear credit union and banking executives ask "what is the ROI of your digital technology
solution?". Digital technology solution providers say, "shift your routine transaction volume to the lower cost digital channels." Credit union and banking executives ask, "does that mean I have to maintain both branches and digital channels? My costs go up." Both parties miss the point. Branches and digital solutions are the ante just to have the opportunity to play-in or stay-in the game. Consumers expect and demand more. They want 24/7
365 day access to all the services, products and counselling their financial institution
provides. They want choice according to their timeline and mode of communication. It is 
not about shifting consumers to lower cost channels, it is about service and meeting the expectations of the information age consumer.

Omnichannel represents a long-term journey and commitment. I describe Omnichannel as an “end goal”, not a product, service, or marketing campaign. Omnichannel is the breaking down of silos that exist with most traditional financial services providers. Omnichannel as goal, and its successfully implementation will only occur if it receives the same commitment, resources and seat at the executive table as the CFO, COO, marketing and other key areas of the credit union.  Omnichannel is not just “e” services or digital services. It is the entire member experience. It is how credit unions and banks interact and reach out to their members/customers, both digitally and within the brick and mortar of their buildings.

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