Since I last wrote about Accenture’s report, titled “Financial Providers: Transforming Distribution Models for the Evolving Consumer,” I’ve been thinking a lot about effective communications with emerging Gen YZ personas. Should I take an academic approach? Should I channel my inner Aesop and weave together a parable? What I landed on was to take my own advice from Part 1 and simply be authentic.
As you may recall, the Accenture study described three demographic groups: Nomads, Hunters, and Quality Seekers. Nomads value digital innovation and are digitally active. Hunters look for best prices at traditional banks and financial institutions. Quality Seekers seek high-quality service and data protection first and foremost. Each group places premium value on different things, and so loyalty drivers will also be different. Will the Nomad care about getting a great deal? Of course, but only if that comes as a bonus to the tech innovation she demands. On the other hand, the Hunter is normally happy with a discount-over-technology tradeoff.
So, how do you interact with these groups? Is it even realistic to speak authentically to all of them? (Spoiler: yes!) To put a point on this, keep in mind that Gen YZ is brilliant at sniffing out marketing BS, and the “all hat, no cattle” approach won’t work. So, you have to put in real work to personalize and customize the connection.
The Wall Street Journal recently ran an article about how traditional retailers are failing to customize and personalize email offers. The point wasn’t that traditional retailers couldn’t compete on product, but rather that “most [traditional] retailers haven’t done the unsexy work of understanding how to use the data.” Email offers that don’t match up to customers’ needs are left unopened—sending alerts about dress sales when a shopper was online shopping for boots, or promoting established brands that a shopper had never purchased. Not only did these “lazy” emails not result in sales, but they are leaving a sour impression about the brand—clearly they don’t get me. Ouch.
This disconnect isn’t limited to consumer retail—it lives throughout banking and financial services, too. An article published on The Financial Brand website describes how “almost every consumer can attest to receiving irrelevant offers from bank or credit union employees, call center representatives, or directly via direct mail, email, or other channels. A bank or credit union offers a travel reward credit card when a consumer clearly no longer travels, sends offers for hundreds of dollars to open a new checking account when one is already owned at the same institution, or randomly suggests a consumer take advantage of the latest equity credit ‘loan sale’ when a home isn’t owned.” Not only will the wrong outreach fail to generate revenue, it will also confuse or annoy your customers.
Consider the ways you may (not) be authentically connecting to these Gen YZ personas.
Do your tools put the power in the Nomads’ hands, and do your products satisfy their appetite for innovation?
- Nomads are comfortable with the disappearance of “the middleman.” Enabling direct payment options (both person-to-person and person-to-business) satisfy their need to get things done efficiently via a personal device.
- Seventy-eight percent (78%) of Nomads say that they would consider banking with a large tech company (Google, Amazon), a major threat to traditional banks.
Can Hunters access human advice when they want it and have their service expectations met?
- What is your reputation around reliable quality and low price? These factors appeal strongly to Hunters, who will hunt for this trophy combination. Brands like Southwest, Citi, and Lyft have cultivated reputations for competitive prices and helpful, accessible customer service.
- Hunters believe that humans give more personalized advice than any automation. The good news is that they are seeking advice. Learning more about the advice Hunters seek and how human advice aligns with their expectations may help train and streamline human staff and build more effective automated tools.
- The classic cornerstones of value and high-quality service do matter a lot to a segment of Gen YZ—don’t throw the baby out with the bathwater as you pursue digital innovation.
Are you reinforcing trust and security with Quality Seekers?
- About half (49%) of Quality Seekers say that high-quality customer service drives loyalty. Even more (59%) want human advice as financial transactions increase in stakes or complexity (e.g., a mortgage). However, 21% of Quality-Seekers have warmed to the mix of automated advice as a supplement or precursor to human guidance. How effectively are you offering these blended communications? Do your automated elements hit the mark, or do they just reinforce that the customer needs a human for things to be done correctly?
- Personal data security is a priority for a majority (53%) of Quality Seekers. This group values communication and confidence around how their financial institution is keeping their private data safe, particularly as high-profile data hacking incidents continue to make the news.
Katabat was founded to unite technology and human expertise in consumer lending. We’ve been providing tools that help our clients understand their customers and use technology to play a central role in ongoing customized connection. Even though the three types of emerging Gen YZ customer types—Nomads, Hunters, and Quality Seekers—vary greatly in what they desire and prioritize, Katabat’s solutions make it possible to help you connect authentically and personally to their range of needs. Build loyalty by doing the work to understand your customers, and then connect to them in the ways they want in order to offer the products and services that they need.
If you would like to learn more about how Katabat can help you understand and communicate authentically with your customers to increase loyalty, please email me at rpeloso@katabat.com.
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Ray Peloso, Chief Customer Officer at Finvi, brings 25 years of diverse consumer lending experience, having held executive leadership roles at Royal Bank of Scotland, Capital One, Citibank, MBNA and Katabat. Ray’s prior expertise in consumer credit and lending underpins a clear vision and understanding of the challenges faced by our clients in today’s rapidly evolving digital economy.
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