21/11/2011

By Scott Thompson

It’s the quality of banks’ engagement, education and communication with Gen Y which leads to customer retention.

A new Oracle report in conjunction with Efma, looking at 100 banks’ priorities and insights in relation to next generation banking, finds that a differentiating aspect of the banks with a dedicated Gen Y offering was that they claimed to deliver an exceptional level of service, and identified four key requirements for a successful strategy: immediacy; interactivity; presence; bringing the flagship store into the online space.

These banks have been significantly more interested in social media. Mobile banking was also identified as an effective way of reaching Gen Y. Another attribute was the speed with which they were able to launch new products. According to the report, most banks without a Gen Y strategy said that launching a product would typically take one to three months – or even longer. A significant proportion of those with a Gen Y strategy said that they could launch a new product in less than a week. However, the report highlighted that only about 30 per cent of the banks surveyed had a dedicated strategy for Gen Y customers, but 38 to 40 per cent were developing one.

Senthil Kumar, group vice president and head of global business development, Oracle Financial Services, comments: “Gen Y strategy demands excellence in customer service. Although a significant number of banks plan to have a Gen Y strategy by the end of 2011, there are many which do not. Banking as business in the coming years can no longer afford to avoid participating or building conversations outside their traditional channels. They need to be in touch with their audience and be ready to respond to rapidly evolving needs of the Gen Y segment.”