MILLENNIAL RELATIONSHIPS ARE UP FOR GRABS

Non-traditional or alternative providers pose a real threat to the future of Millennial relationships with traditional financial institutions, according to a recent survey by Phoenix Synergistics entitled, Millennials, Gen X, and Baby Boomers: Financial Insights.  Checking accounts are widely held by all three generational segments, but somewhat more narrowly among Millennials.  One in eight of all Millennial checking account holders have moved or switched their main checking account in the past two years.  By comparison, fewer than one-tenth of Gen X and Baby Boomer checking account holders have moved their accounts.  Top reasons for switching include surcharge-free ATMs, free checking, a life-changing event such as moving or getting married, and better customer service.  Millennials also express the widest likelihood of opening a financial account with a number of non-traditional or even non-financial providers, many of which have the capability of addressing some of these concerns.  Receiving the widest mentions are PayPal and Amazon, followed by Walmart, Google, Apple, and Facebook.

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William H. McCracken, CEO of Phoenix Synergistics, stated, “In absolute terms, shifting of main checking relationships has been narrow.  It is, however, of some concern that this has been somewhat more prevalent among Millennial households.  Millennials also express the widest likelihood of using non-traditional providers, and in many cases these alternative providers can address Millennials’ issues or reasons for switching.  Traditional providers should take this threat very seriously and begin addressing it in terms of pricing and promoting relationship benefits to their Millennial customer base.  Otherwise, financial provider share could be dramatically altered in the near future.”

These are among the findings from Phoenix Synergistics study, Millennials, Gen X, and Baby Boomers: Financial Insights, featuring 1,000 online interviews comprised of a minimum of 300 in each of the following age ranges: Millennials ages 18-35, Gen X ages 36-51, and Baby Boomers ages 52-70.  This study will assist providers in developing financial services products, programs, and marketing strategies to target each of these important market segments: Millennials, Gen X, and Baby Boomers.