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Banking and Payment Innovations to Capture Millennials Are you targeting the right members of Gen Y? Daniel Van Dyke Research Specialist, Mobile © 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Are You Targeting the Right Millennials?

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Page 1: Are You Targeting the Right Millennials?

Banking and Payment Innovations to Capture Millennials

Are you targeting the right members of Gen Y?

Daniel Van Dyke Research Specialist, Mobile

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 2: Are You Targeting the Right Millennials?

Is Gen Y all the same? © 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 3: Are You Targeting the Right Millennials?

Who are Gen Y.1 and Y.2?

Y.1: 18-24

13%

Y.2: 25-34

18%

35-44

17% 45-54

18%

55-64

16%

65+

18%

Y.1 population: 32 million Y.2 population: 44 million U.S. 2014 adult population: 245 million

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 4: Are You Targeting the Right Millennials?

Gen Y.1: 18 - 24

FINANCIALLY UNCOMMITTED

HIGH TECH MORE MOBILE FIRST

LOW EMPLOYMENT

STUDENT

LOW FINANCIAL PRODUCT OWNERSHIP

Page 5: Are You Targeting the Right Millennials?

Gen Y.2: 25 - 34

BANK FLIGHT RISK

HIGH TECH HIGH MOBILE BANKING

GROWING INCOME

EMPLOYED

HIGH FINANCIAL PRODUCT OWNERSHIP

Page 6: Are You Targeting the Right Millennials?

Y.1 18-24

Y.2 25-34

FIRST ADOPTER 21% 36%

36% 6% SOMEONE ELSE MANAGES FINANCES

48% 5% STUDENT

19% 16% WILLING TO TAKE RISKS

32% 61% MANAGE OWN FINANCES

18% 65% EMPLOYED FULL TIME

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 7: Are You Targeting the Right Millennials?

Y.1 18-24

Y.2 25-34

ONLINE BANKED PAST 30 DAYS 81% 89%

70% 80% MADE ONLINE PURCHASE PAST 30 DAYS

26% 34% MOBILE DEPOSIT PAST 30 DAYS

60% 70% MOBILE BANKED PAST 30 DAYS

20% 25% APPLIED FOR CREDIT CARD WITH MOBILE/PC

56% 63% ATM WITHDRAWAL PAST 30 DAYS

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 8: Are You Targeting the Right Millennials?

5 Recommendations Y1 & Y2:

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 9: Are You Targeting the Right Millennials?

Serve Gen Y.1’s mobile needs like a Neobank. 1

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 10: Are You Targeting the Right Millennials?

41%

3%

4%

6%

14%

32%

19%

3%

5%

10%

17%

46%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Never

More than 12 months ago

In the past 12 months

In the past 90 days

In the past 30 days

In the past 7 days

Percent of Consumers

Y.1 (18-24 years) All consumers

Gen Y.1 leads in mobile banking. MOBILE BANKING USE (GEN Y.1 & Y.2)

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 11: Are You Targeting the Right Millennials?

23% of top FI’s support pre- login balance viewing.

2 Make mobile banking as immediate as Tinder for Gen Y.1.

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 12: Are You Targeting the Right Millennials?

3 Target Gen Y.2 for mobile wallets.

12 months Gen Y.2 is most likely to use a wallet in the next year.

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 13: Are You Targeting the Right Millennials?

37% 44% 47%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Per

cent

of

smar

tpho

ne o

wne

rs

All consumers Y.1 (18-24) Y.2 (25-34)

Gen Y.2 is the most likely age group to use a mobile wallet in next 12 months.

LIKELIHOOD OF USING MOBILE PROXIMITY PAYMENTS IN THE NEXT 12 MONTHS

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 14: Are You Targeting the Right Millennials?

4 Use chat to start a conversation with Gen Y.1.

Page 15: Are You Targeting the Right Millennials?

Gen Y.1 is early adopter of chat for customer service questions.

MOBILE BANKING USE (GEN Y.1, Y,2 ALL SMART PHONE OWNERS)

3%

7%

7%

22%

46%

47%

6%

12%

8%

21%

38%

51%

4%

13%

5%

24%

39%

49%

0% 10% 20% 30% 40% 50% 60%

I logged online to use a 'call back' service to request a return call from a bank representative

I used the bank's online chat service to converse with a customer service representative

I sent an email to the bank's customer service

I phoned my local branch to speak to a banker

I visited my local branch to speak to a banker

I phoned customer service

Percent of Consumers

Y.1 (18-24 years) Y.2 (25-34 years) All consumers

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 16: Are You Targeting the Right Millennials?

5 Be wary of burning Gen Y.1 with overdrafts.

3 in 10 recent Gen Y.1 switchers left for lower fees.

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 17: Are You Targeting the Right Millennials?

Questions?

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Page 18: Are You Targeting the Right Millennials?

Thank you. Daniel Van Dyke Research Specialist, Mobile For questions regarding access to Javelin research please contact: [email protected]

© 2015 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company