Banks Must Shift Gears to Attract and Retain Gen X and Gen Y

ST. LOUIS, July 22 /PRNewswire/ -- Banks' most loyal customers are their oldest customers, while Gens Y and X are the retail banking customers of the future. They're also the least loyal and hardest to please, according to a recent Maritz(R) Poll. The results revealed more than half of Gen Y (61 percent) and Gen X (53 percent) respondents have considered changing or actually have changed their primary banking institutions in the past two years, compared with 20 percent of Silent Generation and 37 percent of Baby Boomer customers.

'For the most part, the current customer experience model at banks caters to the Silent Generation and Boomers, who more frequently bank in-person at branches. But, younger generation customers are much more mobile and rely more heavily on online interactions,' says Thad Peterson, division vice president, sector strategy and solutions for Maritz' financial services sector.

'The banks' most unstable relationships exist with younger customers, because younger people often haven't settled into a stable financial pattern yet,' explains Peterson. 'Banks looking to build long-term relationships with Gen Y and Gen X customers need to think about three basic steps:

#1) Attracting Gen Y and Gen X as customers in the first place -- Locational convenience has always been the primary tool for attracting new banking customers. That's no different with Gen X and Y, but the definition of locational convenience is changing. Now it includes online and mobile and they expect anytime anywhere banking. Banks need a strategy to attract and retain prospective customers who rarely step into a banking office.

#2) Identifying and offering products and services that give young people roots at the bank -- like providing incentives for online bill paying services and debit rewards programs.

#3) Treating them the way they want to be treated. Ensure that the customer experience is appropriate for Gen X and Gen Y, and consistent at all major bank touch points.'

In general, the survey results show that younger people can be more impatient, less tolerant and just plain harder to please than their Baby Boomer and Silent Generation cohorts.