This week I took part in a series of qualitative research groups that involved speaking to Australian millennials about their hopes and fears for the future. Two key themes emerged, which should surprise no one who is either in this generation or building products for it – job security and home ownership.
Insight number one from the sessions was a general sentiment around the need to ‘recalibrate’ expectations. Participants talked about giving up on the dream of the family home they’d grown up with, and adjusting to apartment living with their kids someday. Others talked about the stark reality of home ownership being something one achieved closer to the age of 40. One attendee’s view of the world was that you just had to wait for the current home owners to die, which was a rather morbid, but possibly realistic view.
Insight number two was the growing fear of not being relevant in the workplace, with many participants witnessing the effects of automation in their industries. The anxiety induced by technology was also a hot topic of conversation. The youngest group talked wistfully about the generations before them who weren’t constantly accessible via email or social media.
On the flipside, many were well aware of the things they were able to access and experience that their parents hadn’t been able to – travel was a big talking point here. Globalisation also bought with it perspective. Many participants were keenly aware their lives, relatively speaking, were significantly better than many others in less developed nations.
The reason we undertook this research is because at Zuper we believe an intimate understanding of the fears and hopes of this generation, who are facing unprecedented social and political upheaval thanks to technological forces and climate change is critical if we are to create real and deep innovation in financial services. Millennials, and generations to follow, are facing a steeper and more uncertain climb towards a prosperous future.
To me the question millennials are subconsciously asking the world is who’s going to help me achieve security and happiness? To date, banks aren’t providing an answer, and very few fintechs are either. But there is no doubt an opportunity exists to build a lifestyle financial brand that does answer that question. It’s why fintech’s like Point and initiatives like WeLive are so interesting. I believe we will see the intersection of these two ideas very shortly in the future.
Banks used to acquire customers by first getting you on board with a savings account, with a view to eventually upsell you into a mortgage. Maybe the millennial banking win of the future is to instead first set you on the path to home ownership, whether that is fractionally or through some reinvention of renting, then subsume the rest of your financial life? I doubt I’m the first to think it, but no one, as far as I am aware, has yet to execute it.
The asset poor, cash rich millennial generation is now squaring off against the asset rich, cash poor generation of their parents. Banks are inherently and intractably on the side of the existing homeowners – there is no escaping their entrenched business model in that regard. But who is campaigning hard for the other side? That is the gold mine, plus is the opportunity to build something financially and socially innovative at the same time.
Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy.