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The $30 Trillion Trust-Fall: Reaching Millennials Amid the Great Wealth Transfer

The generation born between 1981 and 1996 will soon be on the receiving end of a $30 trillion windfall as Baby Boomers begin to retire

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  • Written by  David Greenberg, Chief Marketing Officer at Act-On Software
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  • Comments:   DISQUS_COMMENTS
The $30 Trillion Trust-Fall: Reaching Millennials Amid the Great Wealth Transfer

Millennials might be able to afford that avocado toast, after all. The generation born between 1981 and 1996 will soon be on the receiving end of a $30 trillion windfall as Baby Boomers begin to retire and pass down their wealth in an event appropriately dubbed The Great Wealth Transfer.

However, this massive transfer of wealth won’t be without its complications as Millennials (who came of age during the financial disaster that was the 2008 Great Recession) are notoriously skeptical of financial institutions. In fact, younger millennials are putting more faith in Reddit and Elon Musk (Dogecoin anyone?!) than in financial advisors.

Banks and other financial institutions are clamoring to win the business and trust of a generation poised to inherit a tremendous amount of capital, and they’ve had to re-write the playbook on marketing tactics to attract and retain the tech-savvy consumers who grew up with the internet. Read on to learn how fintech brands are vying to earn Millennial trust by stepping up their game using marketing automation and SMS communications.

Leveraging behavioral data

Millennials have high expectations when it comes to brand engagement, and they won’t spend time (or money) with a brand that doesn’t offer a unique, personalized experience. To better connect with younger generations, fintech companies need to understand and leverage consumer behavioral data to create tailored experiences for their customers.

As Millennials navigate social media, websites, and a variety of apps to evaluate different service offerings, fintech brands can leverage their behavioral data to learn more about them. On which webpages did a particular user linger? Which pages did the user leave immediately after arriving? Did a user download an app, then subsequently delete it? How many times has a user visited a website? Fintech marketers can aggregate this data to create audience segments and deliver more personalized calls-to-action, like special offers or credit card applications, on pages where those audience segments are known to spend time.

By paying attention to their audience’s behavioral data, fintech brands can start to develop a good idea of who is visiting their site — and more importantly, how they want to spend or invest their money. It also helps to gain a deep understanding of how individual consumers want to be communicated with or how they choose to engage with the brand. Customer behavior analytics will review if consumers are more likely to open a message at a certain time of day, their preferred channel, and so much more.

Once financial institutions start to understand their prospective customers, they can better nurture their leads with personalization and relevant communications that build loyalty with the brand.

Removing the guess-work with marketing automation

Another way financial institutions are reaching younger generations is through digital marketing automation. As we saw with the recent Gamestop/Reddit frenzy, many Millennials are likely (and may even prefer) to manage their finances online or via mobile phone as opposed to in-person. Plus, for many Millennials, the internet is a matter of convenience, a one-stop-shop where they can research a financial institution one minute and start banking with them the next.

As financial institutions seek to establish and nurture relationships with younger customers, they must do so in a digital environment, as modern investors won’t step foot in a financial advisor’s office. If financial institutions are serious about connecting with Millennials and earning their trust, they need to reach them where they are — the digital frontier.

As mentioned previously, financial institutions can learn a great deal about their customers by analyzing their digital behavior. Did a certain type of email subject line appear to attract or repel readers? What time of day is a certain audience segment looking at a brand’s social posts? Do users respond better to promos or more educational content? Once fintechs answer these questions and feel confident about their audience segmentation, the real fun begins — with email automation.

Banks that embrace automation can remove all potential for human error with powerful email marketing tech. Email marketing is incredibly sophisticated today; so much so that financial institutions can use customer data and machine learning to determine the optimal time to send customer communications.

What’s more, the automated email tech will continue learning and honing its communications as Millennials engage with the emails they receive. Ultimately, financial marketers should have a full-fledged automated email schedule for each audience segment, ensuring that Millennial contacts are receiving relevant, personalized communications that encourage them to engage.

As The Great Wealth Transfer continues and younger consumers seek the right banking partner, financial institutions will want to remove all guess-work from their communications and stay top-of-mind with the younger generations.

Meeting Millennials where they are: their phones

SMS (or text message) communications, similar to email marketing, have proven to be a powerful way financial institutions can engage younger generations. We know Millennials love texting (60 percent of them like to communicate with businesses via text), and businesses hoping to make a lasting impression would be wise to reach out with the preferred communication method.

However, financial institutions would be mistaken for thinking that SMS marketing is a substitute for email marketing; rather, the two should complement each other and have consistent communication styles, though the content itself should differ across the two channels.

Email is ideal for longer messages or newsletters, and SMS is better suited for brief promo offers, transaction confirmations, or activity updates. These short and sweet updates via SMS are not only convenient for users, but are also excellent ways for a brand to maintain a drumbeat of engagement. Savvy fintech marketers will use a combination of email and SMS marketing to deftly drive home their messaging efforts.

For example, let's say a bank sends out an email newsletter with information about trending stocks, index fund performance, and overall investor outlook. The email serves as an educational resource and encourages fintech customers to engage by logging into their accounts. If these customers decide to capitalize on the bull market and make an investment — and if they’ve opted in for SMS communications — they’ll receive a text message confirmation of the transaction.

Not only does the SMS verification prolong the brand’s engagement with customers, but it also builds brand trust by providing peace of mind that the financial transaction was successful. Both the email and the SMS communications are valuable on their own, but together they create a holistic banking experience that lets users feel more connected with the brand.

The two-prong approach of email and SMS outreach not only solidifies a brand’s messaging efforts, but also demonstrates to users that the bank is making concerted efforts to address their unique needs. With SMS marketing bolstered by a robust automated email campaign, banks and fintechs can meet Millennials where they are and demonstrate that they’re paying attention.

The Takeaway

As Baby Boomers begin to initiate the greatest wealth transfer in U.S. history, the Millennial benefactors will start shopping around for banks and financial institutions that can meet their needs for investing, retirement accounts, home mortgages, and more. If banks want to earn the business of younger generations, they’ll need to prove their ability to offer personalized banking experiences — and that starts with communication.

By understanding and leveraging behavioral data in conjunction with a personalized marketing automation strategy, financial institutions can begin to earn Millennials’ interest, trust, and eventually, their business.

The Great Wealth Transfer won’t happen overnight, and neither will the influx of Millennial business. Banks should start their careful marketing efforts now so they’re top-of-mind when younger generations are ready to invest in more than their daily avocado toast.


David Greenberg is the Chief Marketing Officer at Act-On Software  

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