The relevance of traditional retail banks to the millennial generation consumer

Abstract

This research project explored the relevance of traditional retail banks to millennial consumers and the possible drivers of this relevance. Given the change in values and expectations of the millennial generation as well as the emergence of new disruptive entrants into the banking industry, banks are at risk of becoming irrelevant to this very important future customer. The aim of this study was to add to knowledge by building a quantitative understanding of relevance of banks to the millennial consumer within the South African context, as well as to gain an understanding of the possible factors that drive this perceived relevance. The study was conducted through an online questionnaire with a non-probability sample of 319 respondents, who were questioned on the perceived relevance of banks and banking services in their lives across a range of consumer values. The main finding was that there is only 50 70% relevance in the relationship between banks and the millennial generation consumer, indicating a threat to the continued relevance of banks and their future continued profitability, performance and sustainability. Functional, informational and conditional value were identified as the primary drivers of this relevance relationship providing an indication of the areas of focus as banks build strategies to create increased relevance to millennials in order to ensure their sustainability.