The stereotypes and media narratives about millennials are legendary.
They’re selfish. They’re lazy entitled narcissists who still live with their parents. It’s the ‘Me Me Me’ generation. They spend all their time on Facebook and Snapchat and they need to be ‘parented’ to do the right thing in the workplace.
But a recent Australian survey, Investing in Millennials, debunks many of the Gen Y myths and shows there is an alarming disconnect between the financial services industry and millennials.
And let’s face it, it’s a generation that can’t be ignored. When the oldest Baby Boomers hit their mid 70s, we’re going to see the largest intergenerational wealth transfer in history.
So whilst they might be excluded from the housing market, they’ve got money to burn. How do financial planners market to millennials and secure their business in the future?
What we have here is a failure to communicate
Zaptitude’s 2016 survey of millennials (those born between 1981 and 2005) shows that young people are willing to engage with the financial services sector but the industry fails to communicate and connect with them in a meaningful way.
More than 70% said that no financial products or services existed that catered for their generation. This means marketers need to take a long hard look at their ‘millennial’ marketing strategies.
Speaking with the Professional Planner, Peita Diamantidis, founder of Zaptitude, says a clear message from the research is that financial planners need to stop “assuming we know what’s best for the public.”
“We need to start asking – we need to literally ask them what they want, and then deliver it,” she says. So what do they really want?
What millennials really want
According to a US survey conducted by Merrill Lynch, ‘Millennials and Money’, millennials are neither entitled or disengaged – instead, they are very much future-oriented and possess a strong sense of responsibility to their families, communities and/or society in general. The Australian-based Zaptitude survey found similar results.
Here’s some interesting stats on what they want:
- Education: 70% of American millennials wish they had more knowledge and skills when it comes to banking and other financial matters.
- New digital solutions: Over 70% of US respondents said they would be more excited about a new offering in financial services from Google, Amazon, Apple, Paypal, or Square than from their own nations’ bank.
- Mobile apps: 74% of US respondents said say mobile apps are important – they’re looking to fintech start-ups and companies for apps in the areas of payments, investments, remittances, crowdfunding, consumer banking, and lending.
- Humour: We don’t mean you need to get all Monty Python on them but 69% of the Aussie millennials surveyed by Zaptitude said they want their financial planner to possess humour. This forms part of a greater push by millennials for connection and relationships that go beyond pure financial advice.
- Control over their money: 72% of respondents in the US-based survey describe themselves as being “self-directed” investors with 41% reporting having no financial advisor of any kind. But remember: this is not pocket money we’re dealing with. In the Merrill Lynch survey, a majority of the survey’s participants reported investable assets in excess of $3 million and 28% said they have more than $10 million.
- Connection and adventure: Finance professionals need to think about the art of storytelling, the importance of authentic connections and how to explain financial matters in interesting ways. Diamantidis calls it the ‘money stuff without the mumbo jumbo’. When you give advice, do it in the context of stories and adventures instead of just ‘goals’. For example, in Diamantidis’ book, Finance Action Hero: Mission Possible, Dimantidis talks about a review of the Matt Damon movie “The Martian” being written to include aspects of managing money. Main takeaway: tell stories, don’t sit in an ivory tower, open up and genuinely connect.
- More face to face learning: The Australian stats revealed that 45% of those surveyed wanted longer-term face-to-face courses and 21% craved live workshops or seminars. Getting up close and personal (in person and online) remains a great way to engage your audience.
Top 5 marketing tips to win the millennial vote
Many millennials feel a huge sense of distrust when it comes to banks and financial planners. A recent study conducted by Scratch (Viacom Media Network’s “creative and strategic SWAT team,”) called The Millennial Disruption Index, found that just over 70% of Millennials say that they would rather have an appointment at the dentist than listen to what banks have to say.
This means we need new and creative ways to secure millennials as customers. No longer can we market to the masses as we did in the Mad-Men style 50s era. Millennials want adventure. Cool and capable technology. Values-based investing. Storytelling. Connection.
Here’s my top 5 tips to engage with millennials and make an impact:
- Engage your audience with valuable content
Providing interesting, relevant content that answers their questions and helps them solve their problems in an engaging way is the best way to market to millennials. Be a reliable source of information and focus on great content marketing to help them manage their finances and create wealth. You can do this through online videos and tutorials, social media posts, blogs and thought leadership pieces that speak to their specific issues (debt, getting into the housing market, investing in an ethical way, how to use your inheritance wisely, demystifying the concept of super).
2. Establish and develop a genuine connection
Daniel Katz of Merrill Lynch has been quoted as saying: “In a world of intense connectivity, young people value relationships very, very highly.”
Young people are seeking authentic connections “to people or to expertise that might help them with their livelihoods or with their businesses.”
As financial advisers and planners, we need to overcome the obstacles of skepticism and trust issues and show our clients that we understand the needs of investors in their 20s and 30s.
Often, however, they have inherited wealth and want to do the right thing with their money – in short, they don’t want to ‘screw it all up’ – plus the financial crisis engendered a great sense of mistrust in Gen Y (only 8% of Merrill Lynch respondents said they had a strong degree of trust in financial matters).
What all this means is that you need to listen carefully, build trust, educate thenm, use authentic messages to establish a strong connection and offer reliable financial information at all times.
3. Use social media as a touchpoint
In order to understand Gen Y, you need to understand how and where they hang out and communicate online. From Snapchat to Twitter to Facebook and Instagram, the proliferation of social media channels present real challenges for brands in understanding where to focus their content marketing efforts.
Interestingly, the platforms they use to interact socially are different from the ones where they seek out financial information. For example, the Zaptitude survey revealed that the preferred social media platforms for millennials to research money and their chosen life adventure were: Facebook (76%) YouTube (40%) and LinkedIn (34%) with Instagram coming in at 29%.
The point is this: you should talk to them where they spend their time and focus on digital channels like Facebook to get across your message. Remember that they’re a fast moving, mobile lot – they will most likely be checking in on their smartphone on the bus. Think about how and where they consume content and make sure your website and posts are mobile friendly.
For example, British start-up Mondo launched the first bank app only accessible and came up with a simple slogan to target millennials: ‘Finally, a bank as smart as your phone’.
4. Display an interest in social causes and philanthropy
Far from being self-centred, miIlennials care. Social responsibility is an important factor by which they select investments, far more than their older counterparts. Values-based and ethical investing have become increasingly popular amongst the young generation. According to a 2016 survey by Morgan Stanley, 29% of investors in their 20s and 30s seek a financial advisor that provides values-based investing.
5. Show them the money, Jerry
Millennials are the generation that grew up immersed in savvy online communities and a wealth of information at their fingertips. What they need from you is advice on how to access to money. Access to funding, IPOs, private placement deals, products and services they can’t find elsewhere, digital solutions, special lending facilities for wealth clients. The more you can show them how you can provide that advice and access, the more likely they will be to respond to your messaging.
Research shows that whilst millennials are interested in fintech and digital solutions and communicating online, what they want more is connection, trust and strong relationships with advisors that grow with them into the future.
The more you can tap into what they really want, the greater chance you’ll have in securing the business of a huge part of the financial services and wealth creation market.
Chris Wrightson. Founder and CEO at Centurion Market Makers, the industry experts in the sale, acquisition and management of financial planning firms. If you’re planning on selling your firm in 2017, we’d love you to call us for a confidential discussion, or continue browsing our website for more tips, tools and info on the steps to take when buying or selling your financial planning firm.
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