As with everything in life, some things are better than others. To some consumers, Coke tastes better than a generic cola. To some car buyers, a Mercedes is preferred to a Honda. To some print store owners, a customer placing a large order is preferred to a customer placing a small order. To some financial advisors, a client with a large portfolio is preferred to a client with a very small portfolio.
We ought not be surprised that the preference likewise should hold for customers and members of Community Banks and Credit Unions. That is, a Bank or Credit Union executive, assuming a rationale individual, should prefer a customer / member that is capable, willing and interested in purchasing numerous banking products & services over a customer / member who is interested in just one or two basic products.
To help us understand customer segmentation, FIS Global recently published an article entitled Attracting and Retaining Gen Y and Gen X, in which they discuss some of the demographic traits of the Gen Y population. One of the most interesting findings is provided in the following graphic:
Not surprisingly, FIS found that Gen Y has high penetration of credit card debt and student loans. Factors that we understand do not bode well for the financial well-being of the individual, and thus, place many of the Gen Y into dire financial position, especially given their high un- and under-employment rates (read more here and here).
But perhaps what is more interesting, is not the percentage of consumers who have banking products, but the percentage who do not!
|Gen_Y||Gen_X||Young Boomers||Older Boomers||Mature|
We find that generally speaking, more than 50% of consumers are dis-interested or otherwise unable to qualify for banking products that are revenue-generating for financial institutions. Most acutely, Gen Y are poor candidates for most revenue generating products with at least 65% of the population dis-interested in banking products that are revenue generating for a financial institution. Other generations, offer a slightly better customer base, yet here too, Bank and Credit Union marketers must be judicial in their approach to ensure that they are targeting the right consumer.