How to Be Hip: Big Banks Can Market to Millennials
Do you want to be hip? Tell young people you don't like big banks. The way some talk, our largest financial institutions are as fashionable as flared collars and stonewashed jeans.
They're not alone. Just about every company is trying to figure out millennials. It's not surprising. Millennials will become the nation's largest living generation this year. That's more than 75 million people ages 18 to 34, who spend $1.3 trillion annually. They're also one of the most influential generations in decades and have an impact on everything from new technology to cultural touchstones.
With roughly 9 million millennial households as customers, Bank of America has a big stake in being relevant to the selfie generation, which begins with being authentic. More than any other generation, millennials want to do things on their own terms. It's not new to reject institutions, but that thirst to discover their own path is amplified in an age of seemingly limitless choices. Consider that Pinterest, Instagram and Buzzfeed didn't exist five years ago, and that people spend twice as much time online as they did three years ago.
All of this makes authenticity a big deal. For a company to succeed with millennials, it can't just shout, "We're innovative!" and "We care!" We have to listen, we have to analyze data and, most importantly, we have to take risks to be relevant -- and maybe make each other a little uncomfortable by saying, "We're trying something new. Maybe it'll work, maybe not."
We always talk about how millennials are some new animal. They're on social media 24/7, they trust friends and not big business. But millennials really aren't that different. They're just better at figuring out what's authentic and what isn't, and consuming only what speaks to them. That's why it's critical to reach them through voices they trust.
Through our research, we know millennials seek guidance for big financial decisions, and want to easily access that information; that's what happens when you come of age during the financial crisis. They also want the companies they patronize to have a greater sense of purpose -- to be focused on not only making a profit but also doing their part to improve the world.
We've seen the value of empowering an uncertain audience. Although thousands of financial education programs exist, many people still struggle with the basics of finance. Improving their understanding requires creative thinking by innovative people, such as educator Sal Khan.
When Bank of America set out to create a no-nonsense financial education resource that people could access on their own terms, the non-profit Khan Academy was an ideal partner. Many topics on "Better Money Habits" resonate with millennials who are facing major financial decisions for the first time -- from understanding a paycheck or a credit score to paying down student loans or buying a home.
Millennials also get this information in other ways, through channels they trust. We've worked with Pinterest to provide specific content on the financial side of personal milestones, from planning a wedding to renovating a home. Through their "pins," Pinterest users show what they aspire to, and this "intent" is a powerful signal to allow us to provide more useful content. Meanwhile, millennials' desire for on-demand video led to a partnership with Vice News on a web-based, mobile-friendly show in which experts discuss financial issues important to young people.
Another key aspect of millennials is their mobility. Among Bank of America customers, millennial households are twice as likely as others to be active on mobile devices, using them to pay bills, transfer money and deposit checks. This provides an opportunity to meet millennials' needs before they even realize them. For instance, an alert on a gas-price hike can prompt a reminder to use a credit card that gives cash back on gas purchases.
Beyond what you can do for them, millennials want the companies they do business with to be invested in improving the world. The term is "corporate social responsibility," but it's really about how companies use their resources to make a difference.
You need the right partners to tackle big problems. For instance, to help fight AIDS we've worked with (Red) and U2, providing more than 15 million days of medication to help prevent HIV transmission in Africa. This isn't about scoring points with millennials. It's because we and they know it's the right thing to do.
Sure, some millennials may not like banks, but they still rely on them, just in different ways than before. As that connection continues to evolve, we'll keep listening to millennials and anticipating their changing needs -- and keep partnering with the likes of Sal Khan, Pinterest, Vice, (Red) and whatever comes next. Now excuse me while I change out of my stonewashed jeans.