3 Ways Financial Institutions are Using Experiential Marketing to Appeal to Younger Audiences
Many millennials rely on their checking and savings accounts to manage their personal finances, but they’re increasingly swapping out traditional brick-and-mortar banks for online options. They are also 2.5 times more likely to switch banks than Baby Boomers, so the pressure to keep this demographic happy is higher than ever. Millennials are banking in a new way— it’s critical that banks evolve their marketing approach in step with this progression. With more banking options than ever before, financial institutions can rise to the top and appeal to this demanding group through experiential marketing.
Coffee-Shop Banking: One thing Millennials are big on? Personalization. Often referred to as the “snowflake generation,” many members of this demographic grew up believing that experiences and items should be customized according to their needs. It makes sense then that some banks are completely making over the typical branch layout to create a personalized experience targeted to Millennials.
Who Did it Best: Enter café banking. Capital One Cafes were recently created to resemble a local neighborhood coffee shop. “Our Cafes are inviting places where you can bank, plan your financial journey, engage with your community and enjoy Peet’s Coffee. You don’t have to be a customer,” boasts the Capital One website. What that means to a Millennial is, “You don’t have to be a customer… like everyone else.”
Digital Banking “Gamification:” “Gamification” refers to applying game principles and mechanics to engage and motivate customers to perform specified activities. It appeals to natural human impulses such as reward and competition. Digital self-service is the norm for banking Millennials— the main banking branch is the mobile device and mobile interfaces are now the face of the bank.
Who Did it Best: To increase the number of deposits, Emirates rewarded customers’ active lifestyles with higher savings rates. To achieve these rates, customers had to open a special fitness account with the bank’s mobile app, sync the app to compatible fitness devices and achieve daily goals expressed in a number of steps. With 12,000 steps per day, customers could get a 2% interest rate. These apps aren’t just amusing and fun— they can have a big impact on a financial institution’s bottom line. Using this gamified app, the bank managed to bring in $4.37 million in savings.
Experience Liaison: As children, many Millennials witnessed their parent’s struggle as a result of the financial meltdown. This generation values experiences over things as they have become increasingly disillusioned with the status quo and the fact that material items are no longer markers of success. Many Millennials are opting to live in cities rather than buy a home in the suburbs— access trumps ownership. Keeping with this value system, many banks are offering experiences to their most valued customers.
Who Did it Best: Citibank’s ThankYou loyalty program allows earning points based on customers’ monthly activities within the bank’s network as well as its partners. Customers can redeem these points for travel experiences, concert tickets, etc.
Utilizing experiential marketing tactics similar to the options above can translate to big business for banks. Financial institutions who ignore the changing bank landscape will be left behind by Millennials and replaced with banks that prioritize convenience and perks.
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