The gap between generations is the stuff of songs and movies. In the insurance and financial services industry, a failure to respond to key distinctions between generational attitudes and behaviors can keep agents and advisors from engaging with consumers, building a strong rapport with them, and closing the gap between their needs and appropriate solutions.
However, financial professionals whose approaches transcend generations may be able to develop and grow bonds more easily with consumers of any age. The definitions of generational boundaries vary by source, and each prospect or client deserves a custom-tailored approach, as individuals don’t always fit labels. Keeping that in mind, here are some insights into nuances among generations and tips for interacting with members of each of the four key adult age cohorts.
Millennials (born: 1980-2000)
America is home to 83.1 million millennials, according to a June 2015 U.S. Census Bureau estimate. Additionally, millennial spending power is projected to reach $200 billion annually by 2017 and ultimately exceed $10 trillion, according to a Forbes report earlier this year. Given this generation’s vast size and strength, it likely will continue to influence development and distribution of financial products and services for many decades. Yet millennials often are referred to as misunderstood; a Google search of the Web for the word “misunderstood” with “millennials” returns approximately 114,000 results.
Consider the following strategies for gaining mindshare and forward motion with millennials:
» Be succinct. As a blog post by Gavin Finn on CustomerThink.com relayed, millennials have been perceived falsely as having “the attention span of a gnat,” but the reality is they have been trained to digest a high frequency of information. For that reason, he said, the volume of information shared with them must be condensed.
» Be transparent. A Mashable post by communications professional Joel Kaplan explained, “Millennials love give-and-take. …This generation craves transparency and dialogue with the products they love.” It may be difficult for millennials to embrace a product or even continue a dialogue about it if they’re unsure they’ve received the needed details.
» Be customer-centric. Acknowledge each millennial’s personality and preferences. An Accenture report earlier this year included the viewpoint of a millennial consumer who relayed, when describing the ideal shopping experience, that “there is [something] about the product and its cost, but there’s also a big part about being treated like a valued customer.”
Here’s a tip that may culminate in matching millennial needs to solutions: Foster your professional online presence (be sure to check for compliance with your agency’s or broker/dealer’s policies), but also suggest offline time with clients and prospects. Invite millennials to meet you with some of their BFFs for a brief, no-strings-attached “lunch and learn” session geared at helping them become more savvy about personal finance matters.
Generation X (born: 1965-1979)
Gen Xers make up a hardworking, well-educated part of the workforce, according to a Center for Work-Life Policy report. According to Forbes, only 25 percent of adults in the U.S. are members of Gen X, but they have disproportionate spending power, with 31 percent of total U.S. income and 29 percent of total net worth. However, at ages 37-51 this year, many in the Gen X group face preparing for their own future as well as for their children’s education and for the care of aging parents.
Following are some potential ways to foster a meaningful relationship with the Gen X consumer:
» Offer an annual needs assessment. Convey that you realize a plethora of priorities may be competing for their attention. These priorities can include college funding, planning for sufficient income in retirement, covering potential long-term care costs, helping to pay the mortgage in the event of untimely death, and more.
» Show empathy. Explain how you’ve managed your own similar priorities (as applicable) or helped other clients with needs akin to the Gen Xer’s challenges.
» Explain value propositions. People are not always aware of appropriately priced solutions for financial needs. According to LIMRA research, Gen Xers overestimate the cost of life insurance by 119 percent.
Try this tip for closing the gap with with Gen X clients and prospects: Educate them about the role of products designed with utility in mind. Consider reviewing policies with available or integrated riders that may be leveraged to help counter financial fallout from a chronic illness, costly accident or disability.
Baby Boomers (born: 1946-1964)
Baby boomers are “entering their retirement years and reinventing what it means to be retired,” according to an Urban Institute data project. This reinvention includes staying on the job longer. However, there is some evidence that the baby boomers’ trend toward good health could be reversing. Moreover, boomers are increasingly entering their retirement years with debt. Still, boomers are projected to transfer $30 trillion in wealth to younger generations.
Try the following strategies for relating well with this populous, wealthy generation:
» Exhibit positivity. The American Management Association has characterized boomers as “more optimistic and open to change” than those in the generation that preceded them.
» Provide face time plus online resources. Ninety-six percent of boomers who participated in a recent Harris Poll reported spending five or more hours on the Internet per week, and 54 percent reported spending 20 or more hours online per week. Boomers may like being able to delve into details on your agency’s website.
» Choose verbiage carefully. Boomers may respond well to a clearly expressed goal that hones in on their unique needs and helps with personalized solutions.
Consider this approach to help bring interactions with boomers to fruition: Take an assertive, straightforward tack. Simply ask whether you’ve earned their trust and their business. Boomers have been exposed to traditional marketing tactics for most of their lives.
The Matures (born: before 1946)
America’s matures, from age 71 upward, actually include members of two different generations. As the Society for Human Resource Management (SHRM) has explained, one group reached adulthood during World War II and was known for its patriotism; the other was known for its pre-war stoicism and its ability to take adversity in stride.
Here are some tips for fostering positive interaction with matures:
» Don’t call them “senior citizens.” Advances in medical science have enabled matures to live longer, but that doesn’t mean they like the term “seniors.” Instead, refer to them as “seasoned” people in the prime of their lives.
» Review solutions from familiar brands. Important spending attributes of the matures include brand loyalty and the desire for security.
» Discuss products that offer flexibility. Matures who live on fixed incomes may appreciate a solution such as guaranteed universal life insurance with a return-of-premium (ROP) rider. This type of product, which can sometimes be issued up to age 80, offers the opportunity (when the terms of the contract are met) to recoup a portion of paid premiums if priorities change and the death benefit no longer is needed.
Consider this strategy to facilitate trust with matures: Demonstrate that you remain available as a resource while matures are considering which solutions are right for them. Matures take their time making decisions. Give them some space, but reach out from time to time to let them know you’re ready to supply more information or answers to their questions.
Being aware of varying generational preferences and knowing how to address them may help you get a physical or “virtual” foot in the door. Embracing a willingness to assist clients across the generational spectrum just may set you apart from the crowd.