By Allissa Kline | Buffalo Business First | Jun 14, 2018, 1:43am
Banks Focus on the Younger Generation
Bankers in Western New York are keenly aware that they must figure out how to meet the expectations of younger customers if they want to stand out in a competitive market.
So they’re investing in more mobile applications, changing branching models and redefining themselves as advisers. But will that be enough to attract and retain the millennial generation, a group that by several accounts is set to inherit $30 trillion over the next 30 to 40 years?
A panel of nine bankers that gathered June 5 at Business First’s “State of the Region” series — sponsored by Phillips Lytle LLP — discussed the challenges of engaging that generation.
For some, it comes down to covering the basics.
“The millennial generation is going to choose banks that provide faster (delivery) of basic banking services 24/7,” said Edward “Ted” Oexle, regional president of Five Star Bank’s Western New York market. “This is a group we have to focus on tremendously because it’s a changing world, and it’s changing by the minute.”
According to a report by the American Bankers Association, 53 percent of millennials surveyed don’t think their banks offer anything unique, while 23 percent said they won’t bank somewhere if the institution doesn’t have a mobile app.
In addition, millennials want digital applications to manage their money. That includes digital budgeting. Martin Griffith, president of Bank on Buffalo, said it comes down to access.
“We have to do a better job, I think, of not necessarily being on the cutting edge of technology, but we can’t be too far behind as community banks or regional banks,” he said. “We don’t want to become irrelevant. If we don’t stay on at least part of that leading edge of that curve, we won’t be able to attract or re-attract (customers) or sustain ourselves.”
Of course, not all banks will be able to create their own digital services. Many will choose to partner with vendors, said David Nasca, president and CEO of Evans Bancorp Inc. in Angola.
“We aren’t going to be the innovators,” he said. “We are going to have to have partners here, whether that’s Venmo or PayPal or OnDeck (Capital).”
Lately, banks have been adding Zelle, a digital payment system and mobile app that competes with Venmo. KeyBank N.A. made Zelle available last month.
Buford Sears is regional president of KeyBank’s Western New York market. He said banks can’t ignore millennials.
“It seems like every month there’s new competition in a new space that didn’t exist in the month prior, and it’s difficult to guess where we’ll end up and how long it will take us to get there,” Sears said.
“But we have to be very, very responsive to this demographic because 20 years from now, they’ll be the folks sitting on this panel.”