Credit Union Growth Through Gen Z and Their Parents

by Amy Neale 

It seems that any credit union marketing article you read these days focuses on Gen Y. Rightly so – they’re at the point where they’re getting loans, mortgages and saving for the future. But you might want to consider expanding your reach to grab Gen Z. Gen Z age ranges vary depending on what you’re reading, but let’s focus on those born between the years 1992 and 2010. And although some of Gen Z may still be learning to tie their shoes, it doesn’t mean that they shouldn’t be on your credit union’s marketing radar as a target demographic.

Gen Z, also known as “digital natives” and the “bubble wrap” generation – thanks to their helicopter parents – are truly unlike any generation that’s come before them. Theirs is a time of a new normal. They were very young or born around 9/11, the burst real estate bubble and the U.S. and global banking crises of the mid-2000s. They will probably never know the term pension, know too well about the Great Recession and their lives have been shaped by more than a decade of economic uncertainty. Their mindset is more like the children of the ‘30s and ‘40s than Gen Y before them.

What does this mean for your credit union? That Gen Z is already thinking about money, their financial future and looking for a financial institution that isn’t just there to hold their accounts, but one that will also serve their growing financial needs, tend to their financial education and give them the tools to guide them into a secure financial future. If that doesn’t sound like a credit union, what does? 

Filling the Connection Gap

These “digital natives” are the first generation born into a digital world. A world of instant gratification thanks to instant music on their iPod, constant Internet access on their smartphones and immediate book downloads on their readers and tablets. But this technologically-dependent lifestyle has left them craving “real” connections. The Consumer Trends Survey from Fiserv Inc. uncovered that the younger the generation, the more likely they are to seek out branches or use call centers at their financial institution. Their tendency is to look for that one-on-one connection when it comes to more complex transactions.

Another survey, this one from TD Ameritrade, discovered that Gen Z mainly worries about affording college (39%) and having a student loan balance (39%). But 55% of those questioned said that if they had an extra $500 that they would save it. These are all ample opportunities for your credit union. And yet, according to a CUNA Credit Union Environmental Scan, two-thirds of credit union members with children at home haven’t signed any of them up for credit union membership. That’s 21.4 million nonmember missed opportunities under age 18 living in members’ households (from the 2011-12 CUNA Survey of Potential Members).

Keep in mind – it’s easier and less expensive to reach these young potential members through their parents than to stand out from the crowd once they’re grown. Here are a few recommended places to start:

• Youth programs – Whatever youth age group you’re targeting, there’s a youth club/website out there to capture them. Just make sure the program is age-appropriate and not talking down to them. It should also financially position them to move into the next age group. Savings clubs are a great place to start. (Check out our Growing Members program!)
   
• Financial calculators – Any online financial tool you can provide Gen Z and their parents so they can make solid financial decisions together helps build confidence in their choices and your credit union.
   
• Financial education – While parents are usually the first place kids go for their financial education, having a youth financial literacy program illustrates to kids and their parents that you have their best interests at heart. Being authentic goes a long way with Gen Z.
   
• A younger credit union – What’s the average age of your board members and staff? We’re not saying fill your board with 10-year-olds, but a member or two from Gen Y is a good place to start. And maybe think of having qualified Gen Y employees in management positions, not just as tellers, to make your branches more youth-friendly.
   
• Strengthen online presence – As with Gen Y, Gen Z does everything online and/or mobile. So make it easy for them to share – they were born to! Encourage social media interaction, good or bad. Just make sure all connections are real and yes, authentic. And make sure your website it mobile-optimized – because that’s how most of Gen Z is going to view it.
   
• Think student-run – What better place to start than where Gen Z spends their days – at school? Student-run credit unions get the kids involved and can educate them about credit unions and finances all at the same time.

Make it your credit union’s goal to be this generation’s first account, first car loan, first credit card and everything in between. You’ll be firmly in place as their primary financial institution when they go away to college and need a student loan or graduate and need their first mortgage. It all starts with the first step of marketing to them through their parents while they’re still young and at home.

Related Services:  Youth Campaigns, Growing Members Youth Sites, Social Media, Financial Calculators, FRC, Marketing Campaigns, Mobile Websites, SaveUp