5 Strategies for Engaging Millennial Investors

BY John Easton, Director of Wealth Management
June 27, 2017

5 Strategies for Engaging Millennial Investors

A radically diverse, globalized and digitally connected generation, millennials are set to take the stage. They already make up almost half the US workforce and will soon hit peak earning potential. Over the next 30 years, they’ll inherit 30 trillion dollars from their baby boomer parents.

The growing clout of the millennial investor represents a huge challenge for financial advisors and companies, at risk of serious disruption. Research shows millennial investors are conservative with their money, don’t trust financial institutions, and are turning by the millions to robo-advisors — now a 55 to 60 billion dollar industry. According to a 2014 report by UBS, just 14 percent of surveyed millennials said they would consult a financial advisor on a major decision, as opposed to 40 percent of non-millennials.

Advisors need to quickly get to speed on how to communicate and build trust with this often overlooked cohort, or they will lose clients after boomers bequeath their wealth to their children. Here are some key things to keep in mind as you bridge the generational divide.

Lighten up

Many millennials are dropping corporate and rule-driven ways of doing business for a more informal approach. Professional millennials prefer a collaborative work environment where their superiors ‘coach’ them — and not just give orders. When advising a younger millennial client, it’s important to keep these expectations in mind.

Keeping a professional yet friendly tone is key. Optimism and positivity are preferred; passion, excitement and commitment are valued; and subtle humour is appreciated. Most of all, when giving instructions to your younger clients, ensure they’re delivered in a collegial way. Millennials (like most people) do not want to be talked down to or treated like children.

Embrace the channels they love

Millennial investors also expect businesses to be just as modern and connected as they are — or they take their patronage someplace else. Advisors thus need to broaden their communication to include channels millennials prefer. It pays to familiarize yourself with these technologies in advance.

The favored communication mix will be unique to each client — so you’ll want to ask. As a general rule (with exceptions) millennials will choose text for quick responses, email for more in-depth communication and video-conferencing for most meetings, saving face-to-face interaction for ‘special occasions’. Adapting millennial communication styles can be more efficient for everyone. For example, in conferenced meetings you will feel less pressure to ‘fill the hour’.

Be accessible

To meet the on-demand, always-on lifestyle of many millennial investors, advisors may need to work overtime. That involves access to your office and records no matter where you are  — and business beyond the normal Monday-Friday, 9-5 boundaries. Accustomed to quick-fire discussions on social media, millennial investors may prefer shorter, faster communication more often — rather than lengthy emails delivered sporadically. Prompt responses are integral.

Build a relationship early and use a CRM

Ultimately, a big reason many millennials turn to robo-advisors is the generation’s relatively low net worth: most millennials have under $100,000 (right now) and many are busy paying back student debt. Robo-advisors offer service affordability, in addition to other benefits.

According to UBS, however, millennial investors “are no more likely than other generations to use online sources” when it comes to key financial decisions. Indeed, millennials worry more than other generations about getting good financial advice from someone they trust when it comes to reaching their goals. Most turn to family, friends and their social networks.

For advisors looking to acquire or keep millennial clients, building a personal relationship with them early is key. This necessitates accommodating their norms and communication styles, and using a CRM designed for financial advisors. Not only will this empower you to keep track of your younger clients’ fast email communiques — its built-in, finance-specific workflows and form fields will guide you through the crucial steps in wealth transfer planning.

There is so much more you can be doing to win over millennial investors. For a deeper dive into the subject, check out our eBook and register for our on-demand webinar “Communicating with Millennials”.

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