ANAHEIM, Calif.–The perception might be they are too saddled with student debt to ever get out of an apartment or parent’s house, but the reality is one-in-three home purchases today are being made by Millennials—and for credit unions that means changing their approach to marketing home loans, according to one person.
Kristin Messerli, founder of Los Angeles-based Cultural Outreach, told the CUNA Lending Council Conference here that credit unions have a unique opportunity ahead of other lenders when it comes to penetrating the Millennial homebuyer market. Messerli, 31 and a Millennial herself, shared many of her own perceptions of the ways the generation is marketed to and where credit unions can avoid mistakes.
“We have grown up with very different types of technology around us and have grown up with a different perspective,” said Messerli.
The perception of the generation, which she acknowledged carries an average $30,000 in student loan debt, is it is made up of “Basement Scholars” who are well educated but living in their parents’ homes.
“But now we are doing very well,” Messerli told the meeting. “One in-three home purchases made today is made by a Millennial. The next generation, interestingly, is questioning a little more about where to go and how much student loan debt to take on. Generation Z tends to be more financially conservative.”
Messerli said the old means of purchasing/communicating was driven by the respective industry, was a linear process and was offline. Today, it’s buyer driven, omni-channel and online, she said.
“The buyer decides the communication channels and how they find you,” she said. “There is a lot more diversity in language, as this is a much more diverse generation. If we choose not to interact on these platforms, that’s fine, but it significantly limits your scope.”
Generational Values
According to Messerli, the values of the generation include:
- Fast Communication. Millennials process information faster and expect quicker responses, she said. “If we don’t get a response kind of quickly, we get sort of anxious,” she said. “We expect a text back. I expect to be able to ask questions and get answers immediately. So when we go to make a big purchase it makes us very anxious if we can’t interact with someone and see what’s going on in the process.”
- Relationship and Trust. Eighty-four percent of Millennials don’t trust traditional advertising. “Because we are digital natives, there is a belief that we don’t want a relationship,” said Messerli. “That is not true—we want the relationship. We want to have a guide in the process.”
- Access to Information and Resources. “We love our research. We have an expectation to do research online,” said Messerli. “We want as much transparency in the transaction as possible.”
- Expertise and Guidance. “We will often question things that you tell us, and I think that is a shift from in the past where we expect the professional to tell us. We have a lot of experience in seeing bad experiences, seeing parents and grandparents losing their homes. You want to encourage your consumers to question everything, it just means a little extra work to provide expertise and guidance. When you do, you get such loyalty. We will be your marketers and advocates.”
- Use of Technology and Multichannel Communication. Eighty-seven percent of Millennials are within reach of their smartphones at all times.
- Mission Driven. “This is one of the most interesting trends with this generation and Generation Z,” said Messerli. “This is where I think credit unions have a huge opportunity. Millennials will pay more for a product or service when they know it has a social impact. We want to work for companies that have a social purpose.”
In discussing marketing, Messerli—who said it was a “huge surprise” to her that credit unions are as active in social media as they are, recommended CUs become more involved in using Instagram and short videos.
“It’s all about how to build a brand in a way that conveys a relationship and builds trust, she said. “Short video is such a great way to communicate who you are. A really great approach to short video is responding to comment questions in your area of expertise. You can do this on your smartphone with a clean background in a quiet space. It can be just 30 seconds. Once you’ve created 10 videos you can put those on YouTube and direct people there. “
Messerli added, “You don’t need to be on every social media platform, but of those you are on make sure you are regularly checking them.”
She also had a word of caution: Sales messages don’t work. “If it feels like you’re selling, it doesn’t feel authentic.”
Be an Advisor and Community Resource
Messerli recommended credit unions move into more of an advisor position by:
- Creating materials for open houses, partner events and online
- Remaining readily accessible to clients and partners
- Hosting events with partners
“Make this a celebratory moment,” recommended Messerli. “Take a photo and share on social media. Offer a small gift that is personal to them.”
Messerli said she still believes Facebook can be effective, but it is also a very “noisy” environment that is being used differently by Millennials and Generation Z. “It’s a good platform for validating your brand. When I see someone doesn’t have a page it seems a little sketchy to me.”
Social Media Tips
Messerli urged every CU to build its network using social media. To do that, she recommended:
- Up-to-date profiles on Facebook, Instagram, LinkedIn, etc.
- Google your name on a regular basis
- Post regularly
- Respond to comments, share posts, and engage with followers.