How credit unions can attract and retain next generation members
Guest post by Kevin OâDonnell, Vice President, Discover Network
How well do you know your members? According to a recent Millward Brown study, the average age of a credit unionâs members is about 46 years old. Fifty-one percent are women, and more than half earn between $25,000 and $75,000 per year. Nearly 60 percent are married, and about a third have children living at home.
But hereâs something to chew on: Just 8 percent of credit union members are between 18 and 24 years old, the coveted Millennial demographic.
You could say that small statistic doesnât matter much. After all, as the Millennials age, theyâll likely join credit unions in numbers to match their parents and grandparents â or not.
Gen Xers and Millennials seem to be cut from a slightly different cloth than their parents or grandparents. They live in a world without walls; believe there are no limits to what they can do; think that being a celebrity is a viable career option; and are comfortable living in an online world that affords them instant access and answers.
With every generation, the gap seems to grow bigger. But if youâre going to reach across the divide to attract a new generation of members, you first have to understand their needs and then offer them the kind of tools and technologies theyâre already conditioned to use.
How to engage Gen Xers and Millennials
More than any other generation, Gen Xers and Millennials want ârelatability.â They want to be with someone or part of something that âlooks like me.â When making a major decision, Gen Xers and Millennials are as likely to seek input from their Facebook family as they are from their parents or siblings.
Credit unions are often community-focused. Older generations might equate this with location-based initiatives, like sponsoring the local Little League team. But to Gen Xers and Millennials, community is created around an idea, a person, information or a movement. In fact, community happens online.
That means you have to turn your website into a well-designed, interactive platform that offers free information and tools that will give both your younger and more seasoned members a reason to engage with you regularly.
A website for the future
What should a dynamic website include? Try a suite of calculators that allow your members to create amortization schedules for their loans, figure out how to pay down their debts and run the numbers for retirement. A regularly updated feed of financial stories, advice, tips and suggestions will help your members boost their financial literacy and feel more in control of their finances. Video and audio podcasts will allow you to engage Gen Xers and Millennials on an emotional level, while comment tools allow members to tell you whatâs on their minds and provide feedback.
But thatâs just the beginning. Consider these possibilities:
âºGreat Rewards. To remain competitive and satisfy member needs, you should offer rewards for all card programs. This is particularly important to Millennial and Gen Xers, who often feel they should be rewarded for spending their money.
âºMobile Payments. If you want younger Americans to include your credit union at the center of their financial universe, offer a card program that allows them to manage money, retrieve and redeem rewards through a mobile interface.
âºAccess to Knowledge. Provide your members with fresh, top-notch, action-oriented financial information (articles, videos, polls and podcasts) and interactive online tools that will help them pay down their credit card balance, track and manage their spending and plan for big purchases. All that search engine optimized content will make it easier for prospects to find you online.
The good news is that your current members are loyal. But to attract the next generation of credit union members, sign up for a corporate account on Twitter, Facebook, and LinkedIn and start to engage Gen Xers and Millennials through social media.
If youâre the kind of credit union thatâs innovative and sees great opportunities ahead, youâll help lead the way to making managing money easy, fun, and convenient for all generations. Adopting these online changes will help you show consumers that your credit union is a financial institution of the future.
For more credit union resources from Discover, including webinars, whitepapers and contact information, visit www.nafcu.org/discover.
Original article appeared in The Federal Credit Union magazine November/December 2010 issue.