When I was in grammar school, the school had a savings program through a nearby bank. We would save our pennies and then at the end of the month a teacher deposited our savings at the bank. The student depositors had a bank book showing our savings. Many times the teacher would take a number of students to see the transaction. Today, we have seen it on TV – someone taking a picture of their check and depositing it in the bank. The mobile wallet. As many of us know, banking transactions electronically has become the norm. Eric Teller, CEO of Google, said: “If a technology platform for society can now turn over in five to seven years, but it takes 10 to 15 years to adapt to it, we will all feel out of control, because we can’t adapt to the world as fast as it’s changing.” Teller went on to say: “Many people hear about advances such as robotic surgery, gene editing, cloning or artificial intelligence, but have no idea where these developments will take us. None of us have the capacity to deeply comprehend more than one of these fields – the sum of human knowledge has far outstripped any single individual’s capacity to learn.”
Technology has always stimulated changes, such as computing power, processing chips, software, storage chips, networking and sensors. Gordon Moore of Moore’s Law in 1965 described the doubling of the number of components per integrated circuit. Technological changes have caused faster computers, making the user experience feel safer and friendlier in functioning. Two of the trailblazers are the smartphones and tablets used by billions. Fingerprint readers, face recognition and voice recognition are rapidly being used and handheld. Millennials touch their smartphones an average of 45 times per day.
It is human nature to resist change in any capacity. We see that all the time with an older generation. For example, if you have an electronic component that needs to be assembled and it comes with instructions, a young person will quickly look at it and in a few minutes it’s operational. Millennials are changing technology and have an incredibly high knowledge of technology. Here are some statistics: More than 85% of millennials in the U.S. own smartphones (Nielsen), and five out of six millennials in the U.S. connect with companies on social media networks (SDL). Catey Hill of MarketWatch wrote: “Nearly four in 10 millennials (39%) say they interact more with their smartphones than they do with their significant others, parents, friends, children or co-workers, according to a survey of more than 1,000 people released by Bank of America. That’s compared with fewer than one in three people of all ages who say they engage with their smartphones more.”
America has, of course, always been a melting pot. But young people between 18 and 34 are the most racially diverse generation in U.S. history – and embody the changing face of America. Forty-three percent of millennial adults are nonwhite, the most of any current or previous generation. For comparison’s sake, baby boomers are 72% white, and Generation X is 61% white. Hispanic and Asian immigrants, who have come to the U.S. in large numbers over the past half-century, and their children, have contributed to that spike in diversity. The Census Bureau projects that the U.S. will become a majority-minority nation by 2043.
The U.S. News Millennial Report states: “We want to live a different kind of lifestyle. Spend money on experiences instead of things: When it comes to spending the money that we do have, we millennials prefer to spend our money on ‘experiences’ because they make us ‘happier’ than material things. This is unique to our generation.” According to the report “Millennials: Fueling the Experience Economy” conducted by Eventbrite, millennials have more than $1.5 trillion in purchasing power and “78% of us would prefer to spend money on events and experiences.” It’s not hard to see why there are more music festivals popping up every summer and big festivals like Coachella, Ultra, Lollapalooza and many others sell out almost immediately.
Each year, credit unions have their strategic planning process. They evaluate the past year’s goals and what changes are needed for the coming fiscal year. Understanding the technology you have and what strategy is needed to be successful in serving the 75.4 million millennials, or at least 15% of them, is crucial. Is the technology available to serve the smartphone user at the speed they want? With each generation, technology became easier and more comfortable to use. Credit unions might not want millennials and technology to be included in their strategic planning process, but it should be talked about.
Norman Halls is former chairman of the board for Arrha Credit Union and president of Madsen Group, LLC. He can be reached at nhalls@madsengroup.net.
