And what if Gen Y does not need bankers??!!
You wouldn’t argue it out, when I say using broad brushstrokes to segment a bank’s customer base is passé. While ‘segment of one’ is what the banking world is moving towards, at the least multiple criteria like homogeneity of behavior, aspiration, value, culture and habit – must necessarily be taken into consideration. My bank probably realized this a couple of years ago when a 20-something, tech-savy, 6 figure-salaried Gen Y customer stepped through its doors and demanded to access her account online. For such customers the mobile is almost an organic extension of their selves, while wi-fi, tweets and on-the-go acceptable lingos. They don’t have time to visit bank branches or wait patiently while the call-centre agent puts them on hold. In fact, they may not even opt to use the inevitable suggestion box at the branch or ATM. Instead their verdict is often plastered across blogs, tweets and discussions on the world wide web…often cluing in your other customers and competitors before you!
So, when someone from this Gen Y segment decides that online communities and chat rooms are the way to go for their financial requirements, banks must ensure that it is THEIR websites that this segment turns to. And, if this same someone decides that she’d rather borrow from individuals rather than a corporation, banks need to provide such forums and facilitate minimum-risk meetings. For this someone from Gen Y, if you are not online then you practically don’t exist. After browsing numerous banks’ websites, I am convinced that the time’s ripe for banks to now move beyond being mere financial executors to embrace the role of financial advisors. There is also this immense opportunity for banks to deepen their reach into these customers’ lives, penetrating those aspects of their routine that lie beyond the realms of traditional banking.
In fact some have already done it. One of the first US banks to launch a blog three years ago went one step further and launched a virtual gaming world that encourages high-school and college students to learn financial management. Another bank has created an online community dedicated to small businesses where members can network and promote products and services. These examples show that banks have recognized that social media is all about inclusion and making communication transparent, thereby engendering trust.
There’s a lesson here for us all…after all, what if the largest emerging global consumer segment really decided that life goes on with or without banks….
Related Read: Banking on Social Media
Comments
Arunnima,
Good thought! I think by 2050, may be the banks many not be there. I am sure world is moving in right direction towards development and empowerment, where at some point in time all people will have economic stability, with out hard work. May be thats the inflection point when money, and the bank would become a hygine not a distinguished factor.
I am aware there lies a core difference to your analysis and my comments - in terms of time.
A good thought though!
Cheers
TDK
Posted by: Karthik TD | November 16, 2009 10:34 AM
Hi Arunnima,
How are you?
A thought provoking write-up.
Prediction is very difficult; especially about the future said Neils Bohr.
If I dare to do so, I believe the banks will stay hale and healthy, if not more powerful for decades to come.
The fundamental reason they will survive and remain powerful is that they do a very specialized job of MANAGING the concept called 'MONEY'.
Changes in technology has allowed the representation of money in various forms from coins, to goldsmith bills, to paper notes, to plastic cards, even as the concept of MONEY has remained close to an invariant from time immemorial.
Every generation will outpaced by technology, Gen Y will be no exception; the best banks will keep pace with the change of technology out of self-interest.
I suspect in 30 years time, the Gen Y will need their banks more than the other way around.
Posted by: Vallinayagam S | January 4, 2010 12:35 AM