Reaching Gen Y
In last week’s article, The Choice of the Next Generation, we focused on aligning your products and services to meet the unique needs of Gen Y. Once you have this backbone in place and the wired generation comes knocking on your virtual door, the next challenge comes in the form of communicating with and retaining these individuals.
Their multi-channel usage means that you still have an opportunity to get some face time with this generation. And given Gen Y’s responses to our questions on how they view the economy, they are much more optimistic than their elders. Twenty-one percent of Gen Yers predict the economy will be in better shape over the next six months, compared to the 9 percent of Baby Boomers sharing those same thoughts.
Consumer optimism is one of the first hints of economic recovery, so these results are a sign that Gen Y will be on the front lines when the pent up spending demand bursts. When this occurs, they will be looking to their trusted financial institution to provide them with guidance in terms of responsible borrowing. They’ve seen the mess that irresponsible borrowing and lending can cause, and will be looking for ways to avoid these same mistakes. Ensure that you have trained staff and online tools available to give that guidance. Rather than being told what they need, this generation responds to having someone listen to their needs first, and then having a product tailored to meet those needs. Through this process, the consumer is able to make an informed decision, and ultimately end up with a unique and authentic product.
Given their proclivity to technology, it should be apparent that you also need to meet this generation on their own turf.
Specifically, having a cogent Web 2.0 strategy is critical to your success in both attracting and retaining a Gen Y customer. Social media, including blogs and social networking sites such as Facebook and Twitter, can provide a relatively low cost entry into this realm. However, I would argue that just because it’s free doesn’t mean it’s easy. Sure, you can assign an intern to set up a Facebook page for your institution, or tweet your latest product offerings. I’m sure your customers, especially those in Gen Y, are just lining up to become “fans” and “followers” of their bank (that’s my Gen X sarcasm coming out).
To get any real traction or results in this arena, you need to be willing to commit some resources to it. If you want to attract new business, you need to spend time identifying potential leads, rather than waiting for them to come to you. We’ve heard from institutions that have had success in generating new account openings by regularly monitoring some key word traffic on some of the popular social networking sites. A post such as “does anyone know of a bank in the area offering a good rate on a mortgage” is an obvious opening for a reply from your institution to at least let the individual know that, “hey, we’re here and would love to talk with you.” This grassroots approach will take additional effort, so it’s important to monitor whether or not the work is justified by the results.
What best describes your Gen Y strategy?
- 3. We're designing products and channels to appeal to Gen Y (51%, 64 Votes)
- 1. Still working on our Gen X strategy (12%, 15 Votes)
- 4. We’re happy with our current customers, besides more customers = more problems (6%, 8 Votes)
- 2. We know we need one, just not sure what it is yet (31%, 39 Votes)
Total Voters: 126
Gen Y is also turning to social media to help shape their consumer decisions.
Rather than take the word of advertisers, they look to the members of their online communities to inform them of what products are worthwhile, and which brands are not living up to their promises. Twenty years ago, if a customer had a bad experience with a bank, they might tell their family and friends. So in the worst case, maybe a dozen or so people would have a negative view of your institution. Today, that same individual might post their experience on a blog or social networking site, where it is seen by an exponential number of people. If you screw up bad enough, it becomes viral and your one mistake is seemingly broadcast across the world.
A relatively harmless recent example of this was the cancellation of Rainn Wilson’s Alaska Air flight (if you’re a disenfranchised paper salesperson, you know Rainn as Dwight Schrute from The Office). Cancelled flights happen every day, but when a person that has almost one million Twitter followers gets ticked off and tweets about it, the problem is no longer contained to just the 150 individuals on the flight. Suddenly, one million people are evaluating the level of your customer service. Are you sure you want to hand that responsibility over to an intern? Below is the exchange between the disgruntled customer (Rainn) and the Alaska Air customer service representative.
Rainn: Hey @AlaskaAir you cant just cancel flights & then say, “Sorry!” & not help people get to their destination. Not cool. Fix yr planes, jerks.
12:41 PM Jun 25th from web
AlaskaAir: @rainnwilson What’s the flight#?
12:42 PM Jun 25th from CoTweet in reply to rainnwilson
Rainn: @AlaskaAir #2330 operated by @horizonair – plane broken and everyone told “sorry, come back tomorrow!”
12:49 PM Jun 25th from web
AlaskaAir: @rainnwilson Working to gather some additional info re: the cancellation…really sorry for the inconvenience. Can you follow us?
1:12 PM Jun 25th from CoTweet in reply to rainnwilson
AlaskaAir: @rainnwilson We’ve accommodated some people through LGB. We also looked at rebooking on other airlines, but everyone is full.
1:32 PM Jun 25th from CoTweet
AlaskaAir: @rainnwilson We’re doing everything we can to accommodate those that have been inconvenienced. Sometimes these things happen & it sucks.
1:34 PM Jun 25th from web in reply to rainnwilson
Alaska Air responded very promptly and did what it could to diffuse the situation. Others may have a different opinion, but I think that making the exchange less formal with the “sometimes these things happen & it sucks” was actually a nice touch as well. This makes it obvious that the exchange is with a real person instead of just an automated reply. It’s often more difficult to take your frustrations out on a real person than it is with a large faceless corporation. It probably wouldn’t be an appropriate reply for everyone, but perhaps they took a quick look at Rainn’s profile and recent posts and got a better feel for what might work best in this situation.
Does your bank dare to air its dirty laundry and tackle customer complaints in the wide open like this?
If it’s not done well, it can certainly have disastrous results. But the alternative is a one-sided conversation, where customers are sounding off without any chance for the institution to make amends. Bank of America has done a great job in handling customer complaints via their Twitter page (http://twitter.com/bofa_help), and is truly on the cutting edge here. Not only do they respond promptly to direct inquiries, they actually go out and look for problems! In the example below, the customer simply posted this message to their Twitter page (rather than sending the complaint to B of A).
Oh no! Bank of America screwed up my account and now I have almost $200 in overdraft fees to deal with. Of course, I can’t call now.
7:36 PM Jun 27th from Tweetie
First thing Monday morning, a B of A rep proactively contacted the customer to try and resolve.
I work for Bank of America, were you able to call and get it resolved? Anything I can do to help?
9:18 AM Jun 29th from Web in reply to
This is akin to you muttering a complaint under your breath and suddenly having someone across the country jump in to resolve it. The only difference is that the stage and audience is much bigger.
The end result of all of this is that you are meeting Gen Y in the space that they prefer to communicate, and in doing so, giving them the immediate response that they have come to expect. The rush is on to have meaningful interactions with this generation, and many of the large banks in particular have already recognized this. The stakes are high, but the greater risk is in not doing anything at all.
One last comment … we’ve heard that Gen Y doesn’t like the label. They claim it’s unoriginal, unimaginative and unjustly tied to Gen X. So we turn to you, readers of the Raddon Report, to suggest a better name for this generation. Give us your suggestion as a comment below. We’ll select our favorite and send a gift card or a box of golf balls.
Need new ideas, recommendations or solutions for attracting Gen Y?
Contact RFG to learn more about our proprietary research on Gen Y and all the generational segments. Call 800.827.3500 or email.