Leading%20your%20credit%20union%20through%20shifting%20demographics gronbach

The AGE

CURVE

How to Profit from the Coming Demographic Storm

Kenneth W. Gronbach

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League of Southeastern Credit Unions Strategies for the New Millennium 2

Who is Your Member?

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Who is Your Competition?

Who are Your Vendors?

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Who are Your Investors?

Who are Your Employees?

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What is your Community?

US Live Births 1905 - 2005

Birth Chart Build

4.5

Latino Immigration 40 Million+

Number of Births (in Millions)

4.0

3.5

3.0

GI Generation 56.6 Million

Silent Generation 52.5 Million

Baby Boomers 78.2 Million

Generation Y 100 Million (through 2010)

Generation X 69.5 Million

2.5

2.0 1905 1905

1925 1925 1925

1945 1945 1945

1965 1965 1965

1985 1985 1985

2005 2005

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What are your opportunities?

• • • • • •

Loans for retirees Immigrant loans Small business loans Minority loans Women owned business Generation Y loans

•New market loans

What are your challenges?

• Cash Flow • Regulatory issues • Human resources • New markets • New marketing • Banks Hate you!

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Your rightful share of the Boomer Retiree Market!

Baby Boomers will never change

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They just change everything else!

• Baby Boomers will redefine retirement.

• Baby boomers will eventually flood into Florida and the South in general.

• Baby Boomers are currently 49 to 68 years old, peaked at about 56.

• Once the current housing market corrects...watch-out!

• How will changing Boomer consumption effect the Credit Union business?

Make your product easy to buy!

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Four Boomer Rules!

•Have what I want.

•Make my life easy.

•Save me some time.

•Don’t rip me off!

Is credit union success tied to the current U.S. housing crisis?

Is the Pope Catholic?

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Housing’s perfect storm?

McMansions, what were we thinking?

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Housing’s Perfect Storm!

• The foreclosure/housing issue is correcting, freeing up five years of pent up demand.

• Baby Boomers will sell their houses, retire and move south.

• African Americans and Latinos will build and buy houses.

• Asian and European immigrants will build and buy houses.

• The huge Generation Y will rent, buy and build.

• Women will buy and build houses.

• The economy will restore and unemployment will decline.

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The biggest worker retirement in the history of the United States is about to happen!

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Wal-Mart’s retail model is called Cheap and Deep.

The model only works with mature markets.

Too Big To Fail is a Myth!

Small business will return to the United States with a vengeance!

How can credit unions capitalize on this?

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New Generation Y Marketing

Generation Y is Why. • Generation Y was born 1985 to 2004 and is bigger than the Baby Boomers (about 83 million).

• They are very green, humanitarian and do not see race or color.

• They significantly influence trillions in consumer spending.

• They are flooding the labor market and will face 50% unemployment.

• They will open a sea of small businesses because they need to eat.

• They will speak cyber as a first language.

• They tell time differently!

• Credit unions have an economic mandate to understand them and get in front of their demand.

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Gen Y weddings will set records!

Car or Internet?

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Generation Y Consumption • They will start to marry, set up households, have children and need financial services.

• They will buy clothing, cosmetics and hygienic products as they seek to attract mates.

• They will inhale electronics and entertainment.

• They will buy and build houses, rent apartments and buy cars.

• They will change the way food is bought and consumed.

Generation Y will redefine marketing.

• The dawning of the Age of the Customer.

• The end of the Age of the Seller.

• The end of hype.

• The beginning of total transparency.

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The New Decision Makers

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Marketing to Gen Y is tough!

• Gen Y will advance through the ranks quickly because of Generation X. • They are extremely analytical/cyber and will investigate and quantify everything.

• No more good ole boy.

• A pair of tickets will not get the order.

• Conventional media is history.

• How will you reach them with credit union products and services?

Generation Y workplace requirements.

• • • • • • • •

Transparency Integrity Sense of Green Humanitarian Fairness Cyber Empathy They won’t work for mean people!

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The Baby-Blenders 2025 to 2044 No more red-heads

The Boomers are Coming

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What is your Disneyland?

Just Burgers?

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What is your Egg McMuffin?

Lead Sled

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Powerful lightweight two door cars

What is your Mustang?

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Look for women to lead

The glass ceiling is shattered.

Women out number men in college at a 60/40 ratio.

They will run things.

They will control their own finances!

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Women in the Workplace On average women make about 75% of what men make for the same job.

Latinos

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The Latino Influence • Latinos are spiritual Catholics.

• Latinos are very family oriented and take responsibility for their elderly.

• Latinos are aspiring and assimilate into U.S. culture in twenty years.

• The United States economy will benefit dramatically from the contribution of the Latino culture as they advance socioeconomically.

• Is this a new market for credit unions?

Yes!

Asian Americans

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Asians make up only about 5% of our total population but that will change as Asians begin to flood this continent especially from China. They will need financial services.

The American family

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The African American Influence • The symbolic impact of the Obama family in the White House has had a profound positive influence on African American culture.

• As African Americans advance socio-economically so will their need for financial services!

Middle Eastern fertility is well above Western averages.

• Middle Eastern Immigrant’s fertility in the European Union is well above native fertility.

• Over time the Muslim culture will dominate the European Union.

• Western European culture and Muslim culture are not homogeneous.

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The core strength of the United States is faith and family.

Dr. Nicholas Eberstadt Henry Wendt Scholar in Political Economy American Enterprise Institute

What are we going to talk about?

• Your Product: Credit Unions • Your product’s unique selling proposition (USP) and brand.

• Your new market, Generation Y and more!

• Media

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You are a credit union, not a bank!

Banks are Greedy Banks are Toxic Banks are not your friend 30

Perception is Reality!

Distance yourselves from banking with a vengeance.

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What is your Unique Selling Proposition?

People helping friends with money matters in a complex world.

The personal aspect of credit unions is your biggest asset.

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Banks do not have friends, banks have interests.

Credit unions have friends.

Marketing to Generation Y

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Madison Ave

Generation Y is Why. • They will probably not come into your building.

• They will conduct their financial matters on their handheld devices.

• Many will live at home well into their twenties.

• They will inhale the latest electronics.

• Relationships are important to them.

• They like to work in groups.

• They will probably marry earlier.

• They will open small businesses.

• They will build 1500 square foot self sustaining houses

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You will need Generation Y employees if you are going to market to them.

Piercings and Tattoos will make the workplace a little more interesting.

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So, how do we reach Generation Y?

Media and Generation Y • Is facebook the clear leader?

• What about radio?

• Does generation Y read newspapers, magazines?

• What about billboards?

• Will television work?

• Snail direct mail?

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Facebook “If you are not paying for it, you’re not the customer; you’re the product being sold.”

Andrew Lewis

Social media should be a part of your media mix.

It shouldn’t be your media mix.

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Radio, newspapers and most magazines are history in Y’s eyes.

111 million viewers watched the 2012 Super Bowl

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How good are you in eight words or less?

Anything for Me?

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All media should drive to web!

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Remember‌..

Early to bed Early to rise

Advertise! Advertise!

Advertise!

Cities will become dangerous places, again, as crime increases.

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Cyber/Robo Cops

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Things to Remember • Housing and the economy will recover within the next three years. Unemployment will decline.

• Millions of Boomers will retire and move to warm climates.

• The biggest generation in the history of the U.S., Gen Y, will start to marry, enter the workforce and consume.

• Manufacturing will return to the U.S.!

• Wealthy immigrants will flood into the U.S. and the Americas.

• One third of our population, Latinos and African Americans, will advance socio-economically as never before.

Credit unions will take market share!

The best days for the United States and credit unions are ahead of us, not behind us!

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What’s Next?

US Triumph: Flight 1152

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We need to have vision

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The AGE

CURVE

How to Profit from the Coming Demographic Storm

Kenneth W. Gronbach

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