By W.B. King
Vericast’s Awareness-to-Action Survey has many insightful takeaways, including that only 31% of those polled seeking help with financial management concerns turn to their primary financial institution (PFI). Forty-four percent lean on friends and family for guidance.
“To survive in this highly competitive landscape, financial institutions must likewise acquire and use their own data to gain a deeper understanding of what their customers or members need and want from them,” the report stated. “Only then can institutions take the necessary informed steps to serve their people, build lasting loyalty and boost their bottom line.”
The San Antonio-based Vericast is a marketing technology company with more than 15,000 clients in consumer-packaged goods, financial, grocery, restaurant, retail, and more. The survey, which includes data from a series of Vericast polls taken in 2022 and 2023, also found that respondents need help with saving strategies (27%), budgeting (25%), understanding credit scores (19%), consolidating debt (18%), and retirement planning (17%).
With 53% of survey respondents saying their less loyal to specific brands and 50% noting that they base daily shopping routines on coupons and special offers, FIs should take notice.
“This doesn’t just apply to shopping and services. Financial institutions should take heed. It is easier than ever for people to switch financial institutions, often in less than five minutes using nothing more than a mobile app,” the report noted. “Millennials and Generation Z have the greatest tendency to make the jump, with 53% of millennials and 42% of Gen Z changing financial institutions in the past two years.”
Preferred Consumer Payments Rails
Those surveyed said that convenience drives which payment channels they use, including online bill pay options and person-to-person (P2P). Seventy-percent also cited banking personalization as a leading driver of satisfaction.
“Debit card use is highest for millennials and Gen X (65%), lowest for baby boomers (49%) and affluent consumers (52%), the report stated. “Credit cards are used by affluent consumers (income exceeding $100,000) more than all other segments (72%).
Additional ways FIs could better serve consumers is to demonstrate empathy, showcase savings, reconsider fee schedules, and revaluate rewards programs, the report noted.
“The current economic environment has prompted 70% of people to explore cutting expenses, including fees and recurring charges. Sixty-three percent are looking for ways to balance saving time and saving money,” the report continued. “People want to know their bank or credit union will reward their loyalty, help them save money and time, and generally make life easier.”
Consumers polled also want decrease or removal of overdraft fees (25%), decrease or removal of monthly maintenance fees (24%), increase deposit rates (21%), better hours and locations (20%), and decrease or removal of late fees (20%).
“The pandemic accelerated adoption of all things digital, including digital banking. People primarily conduct their personal banking through their institution’s app or online site (72% for both), 56% in person at the bank/credit union, and 50% with online-only banks/credit unions,” the survey stated. “But branches aren’t dead. Overall, people are using a combination of brick-and-mortar and digital branch services. Just 3% bank only in-person and 10% bank only online. Financial institutions should evolve their concept of what a traditional location looks like and what occurs there.”
Banking by Age
Highlighting the all-important Gen Z demographic (those born between 1997 and 2005), the report noted: “Now ’tweens to young adults in their mid-20s, Gen Z is adept at digital technology and concerned about their financial health.”
One of the “good” survey takeaways was that nearly half (49%) are “very or somewhat receptive” to marketing offers from financial institutions. What offers do they seek? Thirty-percent want checking/deposit options and 24% want buy now pay later (BNPL) offers. They prefer these offers via email (36%), text (31%), and direct mail (26%).
For those FIs looking to “win over” Gen Z, the survey reported the following:
28% want to decrease or remove overdraft fees
25% want financial coaching
24% want help increasing credit scores
29% want their mobile app to have 24/7 support, and
21% want P2P options.
Millennials, born between 1981 and 1996, “have delayed life’s typical milestones while navigating a challenging financial situation marked by high debt and low or stagnant earnings,” the survey found.
With regard to offers, 42% want more credit card options, followed by 36% checking/deposit offers. Email, at 48%, is the preferred communication medium followed by direct mail (37%) and text (34%). They seek help with saving strategies (37%), raising credit scores (30%), and budgeting (26%). Like their younger counterparts, they want mobile banking apps with 24/7 support (35%) and P2P options (23%).
Noting that Gen X, born between 1965 and 1980, is in it “peak earning years,” the survey cautioned not to overlook this segment. “Gen X is not quite as receptive to banking offers as younger generations (42%), but there is ample opportunity for financial institutions to reach and win them over.”
This demographic wants debit/credit offers (42%), checking deposit offers (40%) and credit card offers (39%). Preferred communication method is email (55%) and direct mail (46%). They seek help with budgeting (30%) and savings strategies (28%). Their mobile wish list includes 24/7 support (25%), card controls, such as freeze and unfreeze (19%), and credit score check (18%).
As many baby boomers, born between 1946 and 1964, enter retirement age, the survey found that finances are “very much” on their mind. “Only 27% surveyed are very or somewhat receptive to marketing offers from financial institutions — but there are opportunities for the right offers in the right channel.”
Their interested in the following offers: savings deposit (43%), checking deposit (41%) and credit/debit cards (38%). Email at 60% was the channel they most prefer closely followed by direct mail, 59%.They want help preventing identity theft (14%), consolidating debt (12%), and retirement planning (10%). As important demographic differentiator was that 57% of boomers never bank at “online only” financial institutions, 53% regularly visit a physical bank/credit union location, and 34% never bank through a mobile app, the survey offered.
Comprehensive, Actionable View
Since each FI has a unique relationship with its accountholders, the report noted that it is critical to include every demographic and related data when determining new banking strategies.
“Before your financial institution can deliver the personalization people expect, you must optimize your available data. Many institutions are unaware or unable to harness the rich and extensive data they have at their fingertips,” the report noted. “Identify a provider that can combine macro and micro data with market insight, analytic support and marketing precision to give you a comprehensive, actionable view into how to connect with more of the right consumers for your financial institution.”
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