Focus on Who Votes
Ah youth! Vendors and bankers long to unlock the mysteries of Gen Z & Millennials to drive profitability. But does the focus on younger customers mean you miss a big opportunity?
Image by Pixabay
In my last newsletter, I introduced my use of Rick Wilson’s book Running Against the Devil and outlined the 4 things you can learn from Rick Wilson:
1. Discover hidden tribes
2. Focus on Who Votes (Youth don’t vote)
3. Think Digital Everything, Not Digital First
4. Stop Flying by Seat of Your Pants
Today, I’m going to tackle #2: Focus on Who Votes
Focus on Who Votes
Ah youth! Vendors and bankers long to unlock the mysteries of Gen Z (or Millennials or Gen Y) to drive profitability. Top of mind for many bankers when they venture into the process of choosing a digital banking solution or with fintech apps is this: Will this solution or app make young people open an account, apply for a loan, take out a mortgage with my bank?
You are not alone. Wilson points out that the youth vote is the nemesis of the Democratic candidates during every US election cycle.
Democrats are all aflutter, every damn election cycle with the idea that the youths are coming out in droves, this time. This time there’s a massive tidal wave of kids ready to rock the vote...Old people vote…. Rick Wilson (p121)
Wait. Didn’t I just tell you that you shouldn’t rely on traditional segmentations like age? Aren’t I contradicting myself now? No. Here’s why: Both the “hidden tribes” and “focus on who votes” force your organization and product road map out of your comfort zones to confront traditional assumptions about banking. One expectation that bankers often have is that if only they could offer the right mobile app, they could capture tens of thousands, if not millions, of young consumers.
The big problem with chasing the youth vote: data shows that young people don't vote; old people do. According to Wilson, the largest number young people voted in 1988 when just 18.1% of those 18-30 voted (Wilson, p. 122)
And for those who say wait, Millennials are using more banking services, the reason is this: Millennials are banking (and voting) more because, well, they are nearing middle age. They have more financial responsibilities.
The youth vote is a moving target…Yes, youth participation was up in 2018, and meaningfully so. The percentage of millennials who voted in 2014 was nearly doubled in 2018...Because the oldest millennials are closing in on forty, the age when voter participation tends to kick up. (Wilson, p.121)
Likewise, the young bank customer is a moving target. The very youngest adults (and teens and children) are dependent on parents and have simple personal financial needs. Millennials, now approaching 40, are acquiring more complex financial needs.
If your digital banking solution has capabilities to help banks “figure out” Millennial consumers, it may not necessarily address the needs of the new younger generation. Further, your solution may have lost track of the needs of Millennials who are older than they used to be.
Missed Opportunity
There is a more profound challenge of focusing on youth: The lost opportunity to address the real and varied needs of older customers. Following Wilson’s dictate that “old people vote,” digital banking solutions that don’t have capabilities to address the specific needs of older adults pass up a huge opportunity. Your opportunity is to show your bank customers how to use your solution to create more complex financial services for those older customers. Needs that they can’t get met by their current bank relationships.
I can hear the protests now: But we have customizable customer journeys! Yes, you do. And, I think it’s time to take a look at those customer journeys. If you want to give your bank customers tools to attract and keep older customers, digital banking vendors must ask themselves:
Have you made some assumptions about older people that aren’t true in 2021? For example, does your solution assume that people over 60 are retired? Can you be honest the assumptions you make?
What are your company’s internal assumptions about older customers? For example, do you have any staff over 40, 50, or 60?
Do any of your customer journeys extend past the life of the customer? (and death is a certainty for 100% of the bank’s customers)? Remember, this journey doesn’t affect just elderly customers.
What are hidden tribes across age groups – what do customers have in common that transcends age segments? Do you assume older bank customers don’t use mobile apps or care as much as younger ones about customer experience? Do you assume that older customers don’t care about sustainability or saving for a new motorcycle? Do you assume 55 year olds aren’t starting businesses?
What capabilities of your digital banking solution enable your bank customers to create new value for older customers - and their businesses?
Do your bank customers have a blind spot about older customers too? How can you help them address these blind spots?
Sure, you must offer a best-in-class mobile app with cool financial management features. But don’t pass up the opportunity to differentiate in your solution’s ability to develop products and services that give older customers more and better value. Eventually, the young folk are going to be those customers.
In other news
Bryan Clagett interviewed me for his BadAss Banking channel. Check it and all his other interviews.
What I read this week:
AgTech - Rantizo uses drones to spray fields in the US. Now they’ve got approval to operate drone swarms. Why? Because there is a labor shortage in agriculture. It’ not just for agriculture. Drone sprays can also be used to sanitize large places like stadiums. AgTech becomes HealthTech.
People, business & the pandemic: Run your business so you’ll never need layoffs
Want to talk? Have a question? Get in touch stessa@pivotassets.co
Did you enjoy this issue? Please share!
Have you subscribed?
Stessa Cohen