Financial institutions that succeed in attracting more millennial users to bill pay are positioned for future success, and targeted outreach to this demographic could reap solid results.
According to Fiserv client data analysis, customers who use digital banking are more likely to use other revenue-generating services, are more loyal and make more transactions, making them among a financial institution’s most valuable.
Bill payment is one of the digital services responsible for driving this value. The service deepens the customer relationship by driving more visits to an institution’s website and opening the door for cross-sell and up-sell opportunities.
The Expectations & Experiences: Household Finances survey conducted by Fiserv found that the availability of online banking and bill pay was a top consideration among millennials when choosing their primary financial institution. It also showed that nearly one quarter of consumers ages 25 to 35 who do not currently use online bill pay have a high level of interest (8 to 10 on a 10 point scale) in using the service at their financial institution.
Financial institutions have an opportunity to capitalize on this window of opportunity by marketing their bill pay services to these young adults as they establish lifetime financial management habits.
To drive adoption among this coveted group, messaging must focus on the benefits of managing bill pay transactions at the bank or credit union.
Financial institutions should focus on these three things when marketing bill pay to millennials:
Highlight mobility and speed. For millennials, technological innovations mark the sweet spot. If they can use their mobile devices to make bill pay easier, you instantly have their attention. Millennials are accustomed to instant gratification and crave a sense of completion when tackling tasks. In addition, many are living paycheck to paycheck, making same-day and real-time payment capabilities not only desired, but necessary. Financial institutions should market the tools that deliver the mobility and speed millennials want including mobile payments, faster payments and alerts that allow them to keep in touch with their finances in real time.
Educate and assist. Despite the fact that 88% of consumers ages 18 to 24 and 93% of consumers ages 25 to 35 use online banking at a financial institution, many remain unaware of all of the features of the service. More than a third of both groups were unaware that they could receive and view bills via online bill pay, for example. Educating potential users about the capabilities of the service by marketing them within online banking and by enlisting staff to become champions of the service can help close the awareness gap.
Millennials are more likely to respond to word-of-mouth recommendations about a service than any other generation, report a desire for help in managing their finances, and are open to advice from sources they trust. This means personal interactions via a call center or branch are particularly valuable opportunities to discuss services such as bill payment.
Tell them what’s in it for them. More than half of millennials say it’s a chore to think about how to manage their money. They worry about keeping track of due dates and late payments. Let them know you have the digital solutions to make it easier for them to stay on track and in control, while highlighting the additional benefits of convenience and time savings. Alerts, for example, can be positioned as a digital "parent," providing useful nudges before consumers miss a payment.
In the end, it comes down to engaging millennials and letting them know what you offer and how it can benefit them. Millennials are looking for the easiest, most convenient path to paying their bills, and financial institutions that successfully communicate the benefits of bill pay are positioned to earn the business of this desirable segment.
Steve Shaw is vice president of strategic marketing for the Digital Banking Group at Fiserv.