Earning Millennials’ Loyalty Means Offering the Right Options
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- May 30, 2019 6:00 pm GMT
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In the not-too-distant past, “options” and “paying utility bills” did not often appear in the same sentence. A bill arrived in the mail, and customers mailed it back with the required payment. A simple, static process for decades. The only options for customers, per se, were negative — you were either “on time” or “past due.”
But today, with paper becoming more obsolete with each billing cycle, method of payment choice is now a very real consideration – especially when trying to forge loyalty with Millennial customers. They have only known frictionless, custom-built interactions that cater to their lifestyles. Choice is a prerequisite expectation of any financial relationship they engage in, and utility companies that embrace and adapt to this new reality will position themselves to earn the trust of this emerging demographic.
Not all options are created equally
It’s no surprise that younger customers prefer digital channels. According to Gallup research, 8 in 10 Millennials report using the internet to manage their finances, pay bills, shop online and watch or listen to online content in the past 30 days.
Additionally, Millennials use debit cards at a higher rate than all other consumers combined, at an 83 percent to 70 percent rate, according to Fiserv research. And, about 58 percent of Millennials view debit cards as the most secure way to pay, compared to 39 percent of all other consumers.
However, not all digital channels are created equally – at least as it pertains to lifestyle integration. Serving Millennial customers means more than just having a digital option or two. It’s critical to examine all the possible electronic channels that exist and offer the ones that will make their lives easier.
Take autopay, for example. It’s a very popular option for customers who may be on more solid financial footing and are comfortable having a locked-in debit payment coming out of their checking accounts on the same day each month.
But for many Millennials, whose balances may fluctuate from month to month, autopay may not seem as appealing. According to Fiserv research, 50 percent of Millennials couldn’t pay back a $500 loan today. For them, flexibility to pay when they know they’re able to makes more sense and helps to prevent a transaction that could negatively impact their finances.
Making it mobile
So, what are younger customers looking for in a billing option? Fiserv research found that 54 percent of all consumers check their smartphone every half hour, and for Millennials it’s even more frequent: The majority say they check their phones every 10-20 minutes. Further, 30 percent of millennials use mobile bill pay/electronic-only bills, compared to 18 percent of the rest of consumers, and 30 percent of Millennials engage in mobile wallet usage vs. 20 percent of all other consumers.
While there’s no single answer, ease and speed are common responses. Millennials want mobile-based frictionless ways to view their bills and make payments.
In addition to convenience, Millennials also value experiences that happen in real time. For example, when customers make a payment, that transaction may not be reflected in their accounts for a few days. For younger customers, that simply doesn’t align with their lifestyles. They want to be able to check their balance, knowing that any prior transaction is reflected for the same reason that they don’t want to be committed to autopay – their finances may be fluid. Seeing a balance that doesn’t reflect a significant payment made 48 hours ago could lead potentially lead to an unauthorized overdraft charge.
The desire for immediacy also extends to customer service. As opposed to waiting in line at their nearest branch or hanging on the telephone for a customer service representative, Millennials are 4.3 times as likely to use automated chat functions to access account information.
Creating a consistent experience
It’s also important to ensure that a customer’s preferred channels are synched to create an efficient, familiar experience from start to finish. If a customer conducts business through a utility company’s app, it makes sense to have a payment reminder via push notification that links directly to the bill pay function on the app. Experiences that look and feel the same, regardless of the action being taken or the medium being used, are key to success.
Exploring and investing in new technology that emphasizes choice and convenience are key to building loyalty amongst Millennials. But it’s also important not to remain static once current needs are met – continually audit and adjust to stay ahead of the curve.
Forward-thinking organizations are fulfilling – or working to fulfill – the unique experience expectations of Millennials. This means recognizing lifestyle integration as a top priority. Simply put, the utility industry is no longer just a service provider, it’s also an experience provider. And those who provide experiences based on each customer’s choosing will be better positioned to win and maintain the increasingly powerful Millennial market sector.