Losing Your Hair Finding the Right Cohort? Data Enhancement Services Make Your Generational Marketing as Easy as X, Y, Z
Generational Marketing is About Meeting Needs
Driven by demographic change and the general changes in the cultural-social value system, generation-related marketing has become a topic of ever-increasing importance due to ever-faster and more comprehensive communication possibilities.
Prompted by Douglas Coupland's novel Generation X, “generation” is often interpreted in a strikingly categorical way: Generation X, Y, Z, α - enriched with the Baby Boomers who have been around the longest.
Every generation has unique expectations, lifestyles, values, and demographics that influence their buying behaviors. However, generations can’t always be classified by year. Within generations, there are scatterings, individuals that can’t be assigned to one generation across the board.
What really matters isn't generation -- it's needs.
FinTechs Market Create Products For Specific Generations
Consumers place a high value on their personal finances. At the forefront are, traditionally, investment savings and a home mortgage.
Today, FinTech solutions are becoming increasingly popular as they allow people to participate in the financial markets more easily than traditional banks. This can often be life-changing. Think about the rise of SoFi, Stash, Robinhood, Truebill.
Even Experian is advertising that just signing up for their app will increase your credit score. Do you think they’re marketing to Baby Boomers? Unlikely. Boomers already have financial literacy.
FinTech is about more than innovative solutions to digitize the processing of financial transactions. There is a real opportunity for FinTech start-ups to unite customers with the global economy in a completely new way.
Each generation consciously or unconsciously distinguishes itself from the previous one; however, while generations may talk differently, when it comes to how they value their money, they act the same. And today, everybody is online.
“Nearly nine in 10 Americans now use some kind of fintech app to manage their financial lives. That means that more Americans now use fintech than they do video-streaming subscriptions (78%) and social media (72%).” Fortune
Of course, with date-of-birth data, you can send birthday campaigns, but isn’t that so 2000? Does anyone really want a free cookie if they don’t like your menu? Will they signup for your new financial product if you give them a coffee maker. Now Boomers will remember that.
Using the date of birth, household characteristics, and economic indicators data allows you to increase the effectiveness of your marketing efforts for more than just a simple ‘Happy Birthday’ campaign.
Keep the Birthday Card, Send the Investment Brochure
Our first car, moving away from home, marriage, perhaps even a tattoo or some time in the armed forces, a partnership at the firm -- our lives are filled with rites of passage and milestones. Two of the biggest milestones in our lives are buying a home and retirement planning. Neither is easy, and both can benefit from some sound financial advice.
Today most companies have more customer data than they know what to do with. Even having the date of birth of a customer can bring database marketing to the forefront to leverage the potential – audience segmentation.
Database marketing helps create a unified view of the customer across all touchpoints -- from their first car to their first home to the golden years at the cottage.
Every year we wait to start investing for retirement or saving for our home means another year older and one less year of interest and dividend payments. FinTechs are doing customers a favor when they send an invitation to chat instead of a birthday card.
“For many people, the hardest part of getting a mortgage is raising a deposit. To address this issue, fintechs have redefined the concept of the mortgage and have developed alternative financing models that open a whole new range of possibilities.” BBVA
The Mortgage FinTech Needs DOB Data, Too
Like any customer journey, a more streamlined, on-demand mortgage journey can reduce the time from application to offer by a considerable amount. Faster means better. Online access to documents and decision-making removes the need to visit bank branches and eliminates paper usage, which will, in turn, lead to improved customer satisfaction rates.
So, who is your average homebuyer? We all heard about the millennials. They’re not 20 – they’re 40. The average homebuyer is getting grayer, goes over budget in their home purchase, and lives in the South. Go Buckeyes!
A recent National Association of Realtors report showed that the median age of homebuyers in 2021 was 45. This compares with 31 in 1981. The report shows that the median age increased to 47 in 2020. compared to 31 back in 1981.
You can put your calculator back in the drawer -- the dates of birth you’re looking for are 1975 through 1977. Generation X!
"Mortgage originators have been working for years to create an effective and efficient origination process, primarily through digitization of the process … It’s not enough to provide consumers with electronic applications and digitized tools to streamline and expedite activities up to and including loan closing. Today’s mortgage customers expect personalized, highly customizable experiences that include the right mix of technology and personal interactions based on their unique needs and wants." Jim Houston, J.D. Power.
What Questions Will a Home Buyer be Asking?
Does your FinTech’s App or Website answer these questions? Don’t wait to be found. Send the answers before people ask. They’ll thank you.
What financing options are available for my property?
Do I have enough equity capital?
Can I take advantage of government subsidies?
How long can the favorable interest rates be fixed?
How high are possible unscheduled repayments?
Can I repay the loan earlier?
What happens to the financing if the house purchase falls through?
What happens if I can no longer afford the monthly loan installment?
What insurance do I need - during construction and later as the owner?
When will I get an approval or rejection for the financing?
How quickly will the money be made available?
The Investment Starter and Generational Marketing
Where do people go for investment advice? Parents? Friends? Uncle Ted? Aunt Vera knows a bit about good investing -- she doubled down on Apple when it was still in a wooden box and picked her husbands well. Family and friends are probably not the best sources of investment advice. You need a pro. Today’s financial marketplace is a fast-paced world of Net Wallet Cryptocurrencies, ETFs, and Fractional Shares. We’re a long way from paper stock certificates, Dorothy.
The most common source of financial advice among investors with some experience level is banks, with 48 percent among beginners and 43 percent among investors with intermediate knowledge. (Statista) Yes, that means more than 50 percent of investors don’t go to banks. That’s a good market share for you – the FinTech startup!
From Google to NerdWallet, we’ve moved from making an appointment with an investment counselor or financial advisor to informing ourselves, at least at an introductory level, via our smartphone. FinTech’s online move into the consumer financial services sector is disrupting the sector to the advantage of especially first-time investors.
“There’s more time to discuss work-life balance, health, kids, starting a side business, home-improvement projects, et cetera. This helps clients understand that financial planning goes beyond their retirement accounts and that I can be a helpful partner and resource for more than just investment advice.” said CFP LaKhaun McKinley, owner of MNM Vested in Katy, Texas.
What Investment Advice do Beginner Investors Need?
People ask questions They Google them. You can answer these often by preempting those first-time questions. Get into the Advisor’s seat and lend a helping hand. Content is still King -- or Queen -- even when it comes to financial services.
Do you want to spend money on insurance cover? If yes: Which risks do you want to cover?
Do you have sufficient reserves for the unforeseen?
Can you pay off existing debts?
How much risk can you take?
What are the typical costs associated with different forms of investment?
Invest everything at once or set up an ETF savings plan?
The average age of American investors is 40 (Generation Y 1981-1996). Interestingly enough, minority groups invest on average two to five years earlier than the average white investor. (Zippia)
You can’t start investing until you’re 18 (that’s Generation Z’s birthdate 2004 by the way), but many parents start the investment early by saving while a child is growing up. Generation Z are looking for Green Investments. Kids climb trees. Parents buy houses with trees. And there’s your opening.
Generational Marketing is Good Audience Segmentation
Baby Boomers, Generation X, Millennials, Generation Z. While we’re still trying to understand today's young people, the next generation already has a name – Generation Alpha. It will be interesting to see how the children of the Millennials develop and how business adapts to this new generation.
Andrews Wharton is known for sourcing data across the marketplace and curating it for your unique needs. We understand the importance of accurate, verified, and compliant data. We literally built a company on it! You can Be Certain; we know how fundamental data is to the future of your business.
