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Young adults hate banks, right? With a down economy, the Great Recession and looming student loans, it is understandable that those coming of age right now have a negative opinion of financial institutions.
Not so fast. The two youngest generations today - millennials and Generation Z - may actually be satisfied with their banks, especially the larger ones. In fact, young adults may not hate banks at all. They could actually like them.
Banking satisfaction on the rise
This revelation comes from a recent J.D. Power survey, which analyzed more than 80,000 customers in the retail banking industry, including members of Gen Z with accounts, or those between the ages of 18 and 21. Millennials, or Gen Y, were defined as those between 21 and 38.
The J.D. Power survey found that Gen Z was most satisfied with big banks over regional or midsize ones, and this demographic actually visited branches on the same level compared to Gen Y and Gen X. Conventional wisdom says that banks are falling out of favor with young adults. However, overall satisfaction was highest for Gen Z compared to their older counterparts.
The real question, it seems, isn't whether Gen Z likes banks. But what keeps them coming back?
Love-hate tech relationship
J.D. Power noted that Gen Z uses banking technology, like mobile and online banking, at a higher rate than older generations.
Market research firm Sparks & Honey polled this youngest generation and found that 41 percent spend more than 3 hours per day on a computer. In fact, Gen Z is incredibly overconnected. They have numerous devices handy, from smartphones to tablets to laptops. From a banking perspective, the trick is for smaller banks to match the technological superiority of big banks.
"Midsize and regional banks risk losing the Gen Z customers to big banks if they can't meet their needs regarding digital and in-person interactions," explained Jim Miller, senior director of banking at J.D. Power. "There needs to be a seamless experience across all channels. The first step for retail banks is to understand what is important to Gen Z and what drives their satisfaction and loyalty."
What satisfies Gen Z? Varied product offerings, for one. Effective and efficient technology, like smarter ATMs, online banking and intuitive mobile applications, for another. Personalized customer service is in the mix, too - which is typically where smaller banks excel - but combining that with the products and technology offered by the big banks could be the real trick to keeping Gen Z coming back for more.
Garnet Capital Advisors 500
Mamaroneck Avenue, Harrison, NY 10528
(914) 909-1000
info@garnetcapital.comGarnet Capital Advisors 500
Mamaroneck Avenue, Harrison,
NY 10528
(914) 909-1000
