15 August 2022
Mark Fawcett, The Financial Services Forum
The majority of people are being impacted one way or another by the cost of living crisis, but one demographic that can be overlooked – perhaps because they are not breadwinners or bill payers – is young people. Otherwise known as your customers of tomorrow.
People are notoriously loyal to their bank – relative to other sectors – so those that strike the right note now could win over a huge number of young people very early in their banking journey. But they must engage them in an informed and considered manner.
The experiences of today’s young people are defined by a unique set of circumstances, from global and domestic divisions and economic uncertainty, the social and political implications of Brexit and, of course, the pandemic which caused unfathomable upheaval for so many young people. Their education was disrupted but so too was their ability to socialise which at such a formative age is a critical loss.
The cost of living crisis is now exacerbating all these negative factors.
Unfulfilled, Unhappy, Lonely
Our research shows Gen Z feel unfulfilled: they are too often unhappy, lonely, lack confidence and are unsatisfied with life. They are uncertain about their purpose and place in the world, have anxiety about the future and find life less rewarding.
Young people are looking for a reassuring voice, a helping hand and a trusted steer. But they are also guided by their principles so relate to institutions and businesses who reflect their passions for fairness, equality and diversity, and respect their fluid approach to interests, views and identities.
We should also not forget that as well as being the customers of tomorrow, they are also future employees. Perhaps as a result of their disillusionment of the past few years, Gen Z place great importance on finding happiness in their careers. Their recent experiences have been far from satisfying, so they see their career as a way to make positive change over which they have some control.
Finding the right way to speak to these people today will be crucial to every bank’s success tomorrow.
“We’re here for you”
The massive disruption experienced by young people means the ‘we’re here for you’ language can still work but needs to be adapted for the times we’re living in and done with an authentic voice. It needs to mean ‘we understand what’s going on for you’ in terms of their poor university or end-of-school experience, their perhaps unsatisfactory exam experiences after so many missed classroom hours, their concern about job prospects, and around Brexit. Banks need to really think about how they can help during this time and have a real, tangible impact on people’s lives. Lip service will not cut it.
Businesses need to nurture young peoples’ natural optimism and be positive, and banks are in a strong position to do this given they are an essential service and one that can hold the key to a certain amount of life’s experiences. Educating young people around financial issues, helping them feel informed and equipped to deal with their financial future will create a connection. Emphasise a brilliant future of limitless possibilities and take them on a journey of shared values. Give them hope and demonstrate faith in their potential.
A less personal but equally as important approach, is to use your platform to celebrate life-affirming stories in the world around this audience, and champion the causes they believe in, banging the drum for positive change.
Make these a natural feature of your culture and communications, while showing authenticity by ensuring that this attitude flows through your business and features in everything you do and say. Young people feel passionately about equality and fairness and will not stand for anything that is not entirely genuine. Show that you are on their side and fighting alongside them and you will earn their loyalty.
A great example of a bank engaging with its communities in an authentic way is NatWest’s MoneySense, a free financial education programme for 5-18 year olds. It helps tackle issues of real interest and concern to young people, such as student budgeting and staying financially safe online and within social media. The programme partnered with COP26 to put a spotlight on climate action, and also offers regular volunteer-led workshops in schools around the country. Overall, it listens to parents, teachers and young people and focuses on content where it can provide the greatest benefit.
When less is more, and means more
This all comes down to being authentic. Young people have lost faith in government and politicians to take a stand and make a difference so are looking to businesses to fill that gap, using any power they may have to effect change. So financial institutions should absolutely get involved and comment on major issues, but it is very important they only do so if they are taking real action themselves. Social media and a very savvy generation of youngsters means there is nowhere to hide and they will get called out quickly and hard.
There’s no escaping the fact that for young people banking is largely seen as a stuffy, unexciting subject that has layers of complexity and is not easy to understand. This is because it’s not something they’ve had any interaction with. If banks can change that by defining how they speak to young people in their language, on topics that matter to them, and in a tone that they will respond positively to, they will see a powerful change in how they are perceived.
With so much of life now taking place online, memorable real-life encounters deliver more value and impact than ever, so a business that invests properly in promoting its support of certain issues will resonate far deeper. While authenticity is always the most important factor when deciding where to plant your flag, finding a couple of causes or issues to support as a business and then investing in taking those out to people in a more memorable way is often the best course of action.
Some of We Are Futures’ most successful and impactful programmes support corporate employees to be in communities and schools engaging with young people to deliver real impact. The value of real-life encounters is especially relevant for young people thinking about future careers. The Gatsby Benchmarks for good career guidance include the importance of memorable encounters with employers and employees, in which school children should have multiple opportunities to learn from businesses about work, employment and the skills that are valued in the workplace.
Don’t be seen to capitalise on the crisis
Finally, just be real and honest. Offer real help and advice, support customers as much as you can and don’t take advantage of the problems everyone is facing. Banks that make financial gain out of the publics’ hardship might appease their shareholders but will make themselves very unpopular with customers. Conversely, being seen to give back in a way that makes a positive difference will put them on the right side of history and, ultimately, earn them the business of a principled generation of potential customers.