Gen-Y's using the Internet all the time (and handing ME the bill)!
by Greg Crandell
Read a little article from eMarketer (click here) about Gen-Y's affinity for the internet. I wondered if this was one of those "Duh of the Week" things Ron likes to talk about (I think their first award was just given away today over at CUSoapbox.com). And then I looked at the charts that the article showed that said Gen-Y kids are using mobile communication 30% more than folks my age.
I suppose that's just a difference in generations. They have technology now that we just didn't have/need/want when I was their age. And they have parents who, for whatever reason, set them up with it. Read this whitepaper for more information (click here for PDF). Don't get me wrong, iPhones are sweet little pieces of machinery. They can tell you songs you're listening to and find you a sushi restaurant and let you watch Gone with the Wind simultaneously, if you're into that sort of thing. But they're also pricey. So much so that some people use the iPhone as a replacement for home phones, internet service and personal computers (read the ComputerWorld article for more info). The fact that poverty is supporting 3G network growth is astonishing to me, but hey...stranger things have happened, I suppose.
But back to young people using the Internet between 80 and 90 percent of the time. What's to be said about that? Is it better for kids to be Twittering and Googling and Flickring and Tumblring and...anything-else-ing all day? Should they be made to pay for it on their lonesome? Is there any way to do it?
I welcome a solution in our "comments" section, if you've got one.
That question is one of the most famous examples of up-selling in American history. Today, credit union executives and marketing teams are striving to create the same up-sell message that will increase their service-per-member ratios. The fact of the matter is, credit unions are not really that good at up-selling when they are not face-to-face with the member. Until now...
How do you seal the deal in a wireless world?
Wikipedia defines Up-selling as a sales technique whereby a salesman attempts to have the customer purchase more expensive items, upgrades, or other add-ons in an attempt to make a more profitable sale.
Not too long ago a member had to walk into a branch to join, add a new service they needed or get a loan for a dream that they had. The face-to-face contact made our jobs easier to up-sell additional products or tell them what was new at the credit union.
Not anymore. Members can now join remotely, apply for loans online, make deposits and withdrawals from free ATMs around the world and hit a shared-branch. Have you ever stopped and considered how many members actually walk into your branches? Wonder if some members even know where your branches are? Or quite possibly what a credit union really is?
Sealing the deal in today’s wireless world is challenging credit unions. Experience has shown that credit unions are really not that good at up-selling when they are not face-to-face with the member.
TELL US NOW:Does your credit union still rely on face-to-face up-selling as its main method of moving products to members?
There are times when someone makes an over-generalization about people my age and I get my feathers up about it. It's never good to make sweeping judgements about a group, particularly people my age - we're all so different, so outstanding. But through personal experience, I've found there's one comment about people my age that's true: we SUCK at money. How much do we know? Most everyone I know gets the whole "work for your money" thing. I was a web designer for a year or so and I made some worthwhile achievements. Then I was a waiter. I'll leave you, dear reader, to figure out which kept me comfortable and which was a job as a waiter.
But then, there's those around me that seem to forget about the whole "bills, taxes, interest" thing. One of my friends admitted to me that their new job was great because their work didn't take any taxes out of their paycheck (she was technically classified as a contractor).
"You know they'll just hit you harder in April," I said, having played that game before myself.
"What happens in April?" she asked with a growing sense of concern.
Which is why it was no surprise to me to see this article from MSN Money. It's called "Why Generation Y is Broke", and it presents some startling facts. For instance:
68% of baby boomers are propping up their children financially
Average college debt: $20,000
Percentage of bankruptcies in the US filed by people ages 25 to 34: 22.7%
I'll be the first to admit - I'm not great with money, but I do know when to hang back on the spending and when to go ahead and do what I need to do. Did I get financial planning courses from my high school? Did those lovely years in college prepare me? No - I was simply lucky enough to be the son of the stingiest man in the universe.
My dad helped me open my first checking account and told me the golden rule of money management: "If you spend all your money, I'll kill you." That's a lesson that sticks with a boy of fifteen. But his guidance has meant all the difference in keeping my head above water financially. He taught me about taxes, property values, investments, assets, and personal finance.
The MSN article asks a question: Is Gen Y dumb, or just lazy? I wouldn't go so far as to call us lazy - or dumb, for that matter - just uninformed. A lot of people don't get how to balance a check book or track purchases. They don't get what compound interest means. They don't know how to solve the little crises that pop up in life. According to the article, more and more high schools offer financial planning classes. That's good news. I personally think that there should be a course that's all about budgeting your money and tracking spending. People my age (and in general) hate math, but there's a case to be made in studying practical math - "life math", if you will. It's not always just "credit" and "debit". You should be taught how mortgages work and how to pick out good rates on loans. More than that, there should be a savings segment.
Emma Johnson, the writer of the article, talks about how Gen Y is a "boomerang generation" - we come back home when we're supposed to be moving forward. I think it's more that we're a generation of "yo-yos"...pardon the phrase. There were any number of articles in the past few years about "helicopter parenting" - that is, parents who hover over their children and try to oversee every facet of their children's lives. Thus, it's not that my generation run back toward their parents in times of financial struggle - they just don't know anything else to do. I think the time has come to pass along a word of advice to my generation:
1) Your parents are trying to save up for their retirement. They want to turn your room into a gym and re-do the kitchen. Quit bugging them with your money problems.
2) Invest your money wisely. An iPhone is a toy. It is not an investment. Its value does not appreciate overtime. If the word "appreciate" doesn't mean anything to you, you don't deserve toys anyway.
3) Credit cards are good. They are useful. They are practical. They also have a limit. Don't go over. And pay them off, for crying out loud.
4) Keep a checking account. Keep a register for it. Remember what purchases you made by writing them down in the register. Keep your statements in a binder or, if you're so inclined, sign up for e-Statements which catalog your history.
5 (and, perhaps, the most important)) If you don't know what to do and you need financial planing advice, TALK TO SOMEONE AT YOUR CREDIT UNION OR BANK. They make money, too. And they do it by helping doofuses like you and I figure out what to do with our scratch. Let them help you.
So, it's here that I have to put up or shut up. If I don't show that I'm following my own advice, the readers (assuming someone reads my articles besides...well, me) will storm my office with pitchforks and torches and haul me off to be tarred and feathered. So, here it is:
THE JIMMY CHALLENGE
I vow to start putting away a portion of my pay each month into my savings account. After six months, I'll let you all know how much I've saved.
If there's anyone my age that wants to jump in on this challenge, let me know. I'd love to stack myself up next to some other folks who are looking to get their finances in check.
Right now, I've got $5 in my Share plan. I'll let you know how much is in there when September rolls around, and ask the people who know (CPAs, financial gurus, etc.) what's the next step in making my money work for me. That way, when someone says people my age are a bunch of bums, I'll be able to say "not me".
(PS - if there are any people out there who happen to know of programs that teach youngsters responsible spending, let me hear about it. jmarks@digitalmailer.com
As DigitalMailer's "blog guy", I always look for insights about blogging and Web Media. Dane has a lot of good insights in this article that answered a lot of my questions.
Dane also does webinars about Gen-Y and the CU Industry, so don't miss out on his future sessions. You can sign up for them at CreditUnions.com.
I popped into DC yesterday (translation: "fought my way through nearly NYC-level traffic while trying not to run over all the joggers with iPods who don't care that the light-up hand means DON'T WALK") to have lunch with Lydia Cole and Dane Coalson, the Gen-Y Industry Analysts for Callahan, Inc. They were plenty friendly, taking time out of their day to go to a swanky little pan-asian joint a block or so away - thanks, by the way, to Cafe Asia, for terrific Pad Thai and a very funky atmosphere.
The things we talked about were mostly resume comparison - they went to different universities than I did (Dane's a Wahoo, Lydia went to Wellsley), they were different majors (Psyche and American Studies, respectively), and they went through Callahan's very involved orientation process. In that respect, they learned credit unions from the inside out and then went right into cutting them open like a biology-class frog. A gross analogy, I know, but worth noting because the two of them get credit union's concerns. They've been given a glimpse behind the curtain that very few get, and they really do know how to get that information across to readers. I'm from a much different spectrum - I didn't even know what a Credit Union was starting out. So, what did I know? I knew about the internet, I knew about where it was going, and I knew what was/wasn't working for businesses trying to cash in. Beyond that? I find out the answers when the questions come. It's a learning process for me, and it's shared by Lydia and Dane, too. They want for their stories and blogs what I want for mine - readership. And they've been getting it. I'm envious in a good way. It's strange, thinking that I've gotten to the point in my life where college is on the way out and real life is creeping on in. The work I've done, the things I've tried, what little of that handful of things has succeeded - yesterday, it hit me that all of that has become my experience. The fact that there are two other people in the world that started where I did and made their way to something important is sort of enlightening. For the record, both Lydia and Dane are considered "analysts", which is pretty big in my opinion...I'm still working on becoming the "Czar" of something, because honestly, what better title is there? But, I digress.
"You have to learn a lot about the industry," Dane said, spilling some manner of sauce on his shirt. "We can all bank on our youth as a selling point or point of interest, but better to know the industry and have plenty to say."
"That's true," said Lydia over her delicious looking fried rice platter. "I wrote an article about the recent upswing in borrowing. It's been well received." It's true - Lydia's article has, to date, received 535 reads, which is terrific. We talked about a lot of things during our all-to-brief lunch: where's the best calamari in town; who's coming out with what Webinars; how we didn't have internet for the longest time before seeing our first dial-up connection come to life; how we're all working to make Web 2.0 something that is useful to the credit union industry. But beneath all our crazy ideas and our real-life snippets, the air of dedication. The kind of dedication it takes to believe that what we're doing is helpful - to people, to the industry, to our companies, to the future and the concept of growth. If we didn't care about what we do, it wouldn't just fester beneath the surface and never show. A lack of dedication online means the whole world can see your displeasure. It's our goal to always put our best foot forward and to do unto the internet what it's done unto us: inform, inspire, enlighten, and expand.
Leaving DC yesterday taught me two outstanding lessons:
1) When planning a trip, know not only where you're going to go after you've parked, but where you're going to be parking. $14 for a decent garage and I still nearly had a coronary when I thought the valets lost my car in the lot.
2) Don't be afraid to reach out to others in the industry that can give you advice, help, and encouragement. Lydia and Dane know what it takes to reach the "youngsters" in the credit union arena. They're sharp, they're self-aware, and they're willing to show you the way. I'd be a fool to think my own experience/the information I gather is enough - I have to rely on the people who really do know the ins and outs of making this business - or any business, for that matter - work.
Which brings me to DigitalMailer, my "handlers". They've been good sports about unleashing me on the internet like some terrible hurricane because they trust my judgement. I've been through the gauntlet of the online world from a few sides now and each trip through has taught me something new and useful. I'm gaining more knowledge every day, finding new ways to pigeonhole it into my work here. In the end, I give them the best I've got and they give me a check that's worth the time it took. How do they get the money for that check?
Because they do what I do, but on a much larger scale.
DigitalMailer gives credit unions a look at their experience and their knowledge in the form of hard numbers. They've helped credit unions make millions in new loans and new members. Their systems are, quite literally, second to none in terms of dependability, speed, reach and return. There are few, if any, people that do this as well as we do. We learn more about our potential to serve all the time, and we apply that learning to the process of improving and maintaining our systems. It can seem risky to hire an outside company to boost marketing, increase member participation, and increase ROI. But people hire DigitalMailer for the same reason Dane, Lydia and I all wound up with our jobs - they want to improve their relationships with the people that make up their business. In my study of Public Relations, I've learned about brand loyalty. The folks that use us do so for one specific reason - there's nobody better.
I get the feeling that, barring anyone finds out about my beautiful singing voice and suave, manly looks (are you getting this, Hollywood?), I'll be at DigitalMailer for a good long while. I'll keep doing my best to let you know that DigitalMailer is the best at what we do. You just be sure to pay attention.
As someone who has been in the business of marketing financial services for quite a while now (tomorrow's my birthday, but that doesn't mean you should know how old I am), I got a bit of a chill when the MySpace/Facebook movement came along: I stay in touch with the "new tricks" of the day as best I can, but how does one learn to market on a whole new wavelength?
As Jimmy discussed yesterday, users - even young adult users - are reluctant to purchase and deal on social network applications. Another article from eMarketer, seen here, shows statistics that prove what I've known for a while now: e-mail marketing works. People prefer to deal with businesses via e-mail, and that's a statistic that goes across a number of age boundaries.
Numbers still remain low for telephone purchasing/level of appeal. I think the reason for this might just be the reason Jimmy outlined yesterday. Facebook, as I see it, is a lot like telephone. You like to hear from friends and family. Over the phone, however, you can't find people that have the same interests as you and you can't join "phone groups" of people who share said interests. That said, the purpose of the two mediums is mostly the same: keep in touch. You might be less than receptive in dealing with a telemarketer (see the "do-not-call" list as proof of that) because they're taking phone time away from people from whom you'd like to hear. The same goes for Facebook - better to let it be a personal space, perphaps, and let the business be done in e-mail...where some 60% of consumers like to do business in the first place.
Face to Facebook: Online Social Networks Might Not Be the Goldmine You Think They Are
Jimmy Marks, Special Guest Author and DigitalMailer's Whippersnapper-in-Chief, talks about Social Networking dollars and digs (or is it "diggs"?) into the bottom line.
I woke up this morning and started on my routine. Toaster-waffles cooking? Check. Coffee brewing? Check. Paper somewhere close to the driveway? Not even close, so...check. And once all the unimportant bits are finished, I go for the laptop. E-mail first, then the morning cartoons, then Facebook. I'm a die-hard "facebooker" - I have been since Facebook's inception my freshman year of college. By the way (I'll bet you didn't know this), Facebook wasn't always Facebook: it started as "AboutFace", a web application designed to be a directory system for industry professionals. Don't believe me? I wouldn't either...which is why I included a link to Facebook's history, courtesy of the Wayback Machine.
So, we have Facebook, MySpace, YouTube - some of the biggest companies that came from some of the most simple ideas. Back in the day, when I was a foolhardy 12-year-old, we had Yahoo! GeoCities - little websites you could cobble together with a primitive WYSIWYG and show off to whomever. You could make a site about anything and, with enough patience (hey, remember dial-up?), you could be a web-wunderkind. But making web pages was tedious at 56k and the odds anyone would care to look at your page were slim. So, it seemed there was just no way to get a hand into the Internet.
Until the birth of Web 2.0, that is.
Suddenly, life was sweet: you could have a page that you didn't have to know HTML to maintain and update! It could have pictures, video, gadgets, information, lists of songs you like, blogs...anything! Best of all, the internet evolved into something that didn't take too long to understand or utilize. So, here we are, a few years older and lifetimes ahead of where anyone believed we'd be. Of course, capital has to come into play, so advertising gurus took aim at sites such as these with the goal of hooking "the youngsters" into purchasing their various wares. A smashing success...right?
No, not really.
Sure, if you choose to advertise on sites like these you'll get some return. But will it be what you expect? And if you're a financial institution (I'll assume you are), can what you're "selling" be boiled down to pure numbers?
The dollar amount is revenues per unique visitor. According to the article linked above, that number is swelling, as is the number of businesses that are gunning for the social network market. It's not a bad idea - put your business out there on a site that people are visiting frequently (by frequently I mean multiple times an hour). Thing is, and I know I can't speak for EVERY 18-34 year old out there, but I don't go to Facebook looking to get sold on something. I go to check in with friends, post pictures from my relatively silly life, and let people know what's up with me. Advertisements are sparse on Facebook, too - which is a reason I keep using it. I get enough ads just reading blogs and news sites. Facebook is my hiding place from all that silliness.
So, where ARE those e-marketing dollars coming from? According to the good people at Nielsen - the same ones that want to know what you're watching on TV - more people spend time on email than anywhere else on the web by almost half. Hallerman's article seems to follow that, saying that direct marketing e-mails contribute to a much wider margin of purchases than do ads on social networking sites. The main means of swaying public opinion online remain search engine returns and positive feedback on the company website. When I look to make a purchase, word-of-mouth (or "word-of-web", as it were) makes a big difference for me. You can learn a lot about something/someone by using Google to see what about them stands out the most. If I find something I want on Google and the talk about it is strong, I'm more than happy to move forward. If people seem to hate it, I shy away.
This is not to say that there's no money to be made on Social Networking sites: clearly, there is. But when it comes to marketing to people my age there's not much difference between what we think and what our elders think. We want to find information, or have that information find us. When we get that information, we want to see that other people found it useful as well. What's the lesson to take away from this, then?
1) Make sure your SEO (search engine optimization) is strong, and that when people search for you they find you.
2)Make your "customer feedback" page a priority: it's common sense to put the good feedback up top, but don't dismiss negative feedback. Rob Banker, another in our DigitalMailer cavalcade, wrote a great article about how bigger companies are using Twitter to monitor customer satisfaction. You really want to make the most of Social Networking sites? See what people are saying about your company without any prodding. One person's angry post about poor customer service and support should be a COO's next "note to self". 3)Diversify, Diversify, Diversify. Advertising in one place is as good as putting on one article of clothing. Any successful marketer will place multiple sites in the marketing mix and never count on just one to make all the difference.
4)Keep watch on what booms and what recedes - Facebook and MySpace are king today, but who knows what's coming up in a matter of weeks? Stay on top of trends and never get thrown on the idea that "it's just a fad". They said the same thing about The Beatles.
Now, if you'll excuse me, I have to go update my status so my friends know I plan to eat burritos later today.
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