6 Steps to Winning Millennial Deposits

Research in the first quarter of 2024 found that Millennials are currently more likely than any other generation to open new financial products across the board. From primary household checking accounts, to mortgages and home equity loans, to investment and retirement accounts, and even business checking accounts. While specific products may see other cohorts slightly outperform Millennials, the overall potential to build new relationships with this powerhouse generation right now is huge.

So how can credit unions reach and attract more Millennials to grow membership and, in particular, to bring in new core deposits? Here are 6 steps:

Step 1: The Right Insight and Targeting

The solution starts with understanding that Millennials are not a monolith, and identifying the segments within this diverse generation that each credit union has the best opportunity to attract. This will differ depending on the market, and depending on the brand position of the credit union itself. What kinds of Millennial segments live in this specific market? What lifestyle and lifestage characteristics do they have? What are their financial needs and challenges that the right partner can support? 

Mississippi-based credit union, Statewide Federal Credit Union, approached answering this question by using 1st party behavioral and transactional data, combined with 3rd party lifestyle data appended in their cloud-based customer data platform (CDP), Strum Platform. Through this analysis, they discovered that certain Millennial segments with young, growing families would be an ideal fit for them to pursue.

Step 2: The Right Offering

But how to bring them in? Credit unions need to reflect honestly on what they have to offer Millennials. Do they have the appropriate products, and are they truly competitive with the full range of financial choices available to this generation – including many fintechs? For Statewide, this reflection led to the design of a new high-yield checking account tailored to the specific needs and goals of this audience. Others may identify a gap in multi-generational banking and respond by developing products for kids and teens, etc.

Step 3: Smooth the Experience

With the right products in hand, the user experience needs to be equally dialed in for this generation to be willing to do business. Online applications, for example, must be as frictionless as possible to simplify account opening – or Millennials will bounce out of the process from frustration and reduced trust. For Statewide, their mobile partner Bankjoy was able reduce abandonment and increase conversion rates, so that the new checking account could be opened online within a simple 90-second process.

Step 4: Go to Market Smarter

Promoting these products, and the experience that comes with them, is the next step. Rather than committing a big budget to traditional mass marketing, Statewide had the data available through its data platform to pinpoint target their priority segments and reach them where they were in a budget efficient way. Further drawing from the data, the campaign messaging was highly personalized to this audience as well.

Step 5: Dial It In

Campaigns are no longer launch-and-forget, they must be continually monitored and optimized. Through their data platform, Statewide had access to daily campaign tracking results, product sales attribution, conversion sources, and automated ROI reports – all providing valuable insights enabling them to dynamically adjust in real-time to optimize marketing results.

Step 6: Grow the Relationship

As all credit unions know, the first product is really just the beginning of a potential lifetime relationship. From here, onboarding and cross-selling programs can take over and, ideally, lead new members into an overall experience that will turn them into all-star members while building their financial health and meeting needs for years to come. In Statewide’s case, their core system, Corelation, had onboarding and cross-selling systems seamlessly integrated into their data platform, allowing for daily data flow and campaign journey reporting.

When these steps come together – from market analysis and segmentation, to product and user experience design, to crafting the right media and messaging, and then ongoing tracking and optimization – what kind of outcome is possible? Casey Bacon, Statewide’s CEO described their results, “As interest rates spiked and the war on deposits ramped up, implementing this targeted strategy allowed us to generate over $12 million in deposits in a very short amount of time.” Ultimately, this approach efficiently drove an increase in core deposit growth, a boost in engagement among existing relationships, and lowered the average age of their members overall.

The Millennial generation, with their wide variety of product needs, is primed for credit unions with the right offerings to build lasting relationships, including core deposits. Credit unions ready to follow the data and provide the full package experience will win the day. 

This article was first published in CUInsight.