Credit unions are in an enviable position to be and services information to the largest generation in U.S. history. This number of 80 million strong is estimated with an annual $200 billion spending habit forecasted to reach over $1 trillion throughout their lifetime. The buying power is impressive and each business on the planet wants to get in front of them. A great first step is to obtain a better understanding of what shaped them throughout the years of 1980 and 1999.
Millennials possess some quite interesting thoughts about the world, beginning with being filled with contradiction and therefore are regarded as digital natives. The U.S. Census Bureau found, “A wired connected world is that a Millennial has ever known.” Considered very optimistic concerning the future, they grew up witnessing terrorist attacks, school shootings, hurricane Katrina, impeachment of a president, Enron scandal, Starbucks, and are shaped by helicopter parents, video games and reality TV. As masters of self-expression, 75% of them have social networking profiles and their main sources of information according to the U.S. Chamber of Commerce Foundation is through television and also the Internet. Up to 80% report they sleep with their mobile phones near the bed. To be able to reach this age bracket, credit unions will need a thorough understanding of what motivates them to create an optimistic member experience.
Don’t wait too long. The Millennial is already featuring its effect on car buying. According to the Los Angeles Times, approximately 35 % (ages 18-34) intend to purchase a new or used vehicle within the next Twelve months, exceeding the nation’s average of 24 percent of consumers. Mobile commerce will be a huge contributing factor based on Aabaco Small Business, as 41 percent of Millennials complete purchases on their own smartphones and up to 86 percent will use multiple cellular devices along with a desktop, to car shop. Car sales and leased vehicles are surging, as they move to the suburban areas to obtain married, purchase homes and lift families.
Considered to be probably the most educated generations in American history, 63 percent have a very Bachelor’s Degree, they also have the distinction of getting more student loan debt than credit card debt. Despite being cash strapped and slow to consider credit, based on Money.com leasing accounted for almost 29 percent of all new car purchases by millennials in 2019. One of many reasons behind this popular option is leasing provides access to more costly options. Being able to get an extravagance vehicle under $400 a month, when purchased could be over $600, makes leasing a beautiful choice for this group who have yet to go in their peak earning years. Technology also factors into leasing’s popularity, driving off in the vehicle with the latest gadgetry, every 3 years, really attracts this tech-savvy group.
Because of their relationship with technology, influencing them calls for multiple channels, they like social networking and are not shy about sharing their opinions. Probably the most preferred ways of being reached- word-of-mouth and brand building through social channels. Having a presence on social media will be key to reaching this hurried group who like to invest time building relationships with brands and are willing to share their experiences with peers.
Credit unions can and should be active in bridging the space to greet, with open arms, this emerging member to secure future growth. The sooner the better. The average chronilogical age of the credit union member within the U.S. is 47, to be able to grow, time needs to come down. Millennials constitute another from the nation’s population, studies have shown they are not as likely to use conventional banking and like instead to make use of online financial services. This has boosted their reputation as being “un-banked.” They’re also very skeptical of big banks according Forbes, rating the 4 biggest bank brands one of the “least loved.” Like a group, they need authenticity and transparency with regards to financing, a good example of this is the Occupy Wall Street movement in 2011 which credits people in their 20s striking the streets to protest income disparity and economic inequality.
The great news, they are group oriented. Isn’t this what credit unions are all about? Serving groups? You’re ready to tap into this energy. The mere meaning of a bank fits the millennial business handbook: a nonprofit-making money cooperative whose members can save or borrow from pooled deposits and loans at competitive rates with no gimmicks. It’s imperative to seek out new and forward-thinking ways to welcome Millennials and educate them on why lending institutions really are a perfect fit when matching their demands and desires. The ability to connect and expand with Millennials as that segment matures is among the leading factors that will pick which lending institutions will expand or cease to exist in 20-30 years. This is the time to pay attention to this demographic if you have not done so already. Time’s a wastin’!