Credit unions make no secret about their desire to attract Gen Ymembers. But are the Millennials worth the effort? On the one hand,the generation's emphasis on business ethics and supporting localbusinesses are a custom-fit for financial cooperatives. But on theother hand, the generation is burdened with unemployment orunderemployment, as well as historically high student loanbalances. Neither is good news for credit unions attempting to growlending programs.

Read two opinions below that argue both sides of the Gen Ydebate.

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Why Gen Y? Because credit unions can'twait.

By Ryan Ruud

A few weeks ago there was anopinion piece in Credit Union Times (“Gen Wait:Millennials Underbanked, Underfunded.” Jan. 13, 2014) thatseemed to suggest that the Millennial generation, those bornsomewhere between the early 80s and the early 2000s, were a lostgeneration.

In many ways the net generation has its fair share of battlescars. The piece correctly cites the mile-high student loan debts,however arguably provides some questionable advice to credit unionsadapting to the digital era and what role millennials play ininfluencing digital strategy.

The largest generation, not the small andover-indulgent

Ignoring what's become the largest generation since the boomersputs any business, especially credit unions at risk. Depending onwhere you look and how they mark the beginning and end of thegeneration, the size of the population ranges from the same as theboomers according to PewResearch, 76.3million or 27.4% of the population (1% more than boomers) to86 million or 7% larger than the boomers according to Barron's.The Brooking's Institute even reports the generation is 30% largerthan the boomer's.

Ignoring a generation of this size just for the shear buyingpower alone would be foolish. But it's not just buying power we'rediscussing. The piece also claimed pundits have been “scaringcredit unions into millennial-oriented products like mobilebanking, mobile wallets and NFC.”

Ignoring early adopters is equally as risky.

Let's examine the data and popular opinion around both buyingpower and the digital influence of this generation and whyultimately credit unions can't wait.

The facts: Economic power

The great recession provided a front row ticket to finance andeconomics in motion for the millennial generation. Just as most ofthe generation was coming of age and entering the early years ofadulthood, the ground beneath them and the rest of the country gaveway. Arguably, living through the crises of 2008 and the years thatfollowed would shape how the generation felt about money.Joblessness and financial discomfort are not indicators of how ageneration behaves. They are indicators of how an economy raisedthe generation.

But interestingly enough, that big ol' generation has big ol'buying power and now that the economy is turning the corner and thegeneration is starting to age, key life moments are occurring whichalso are triggering key financial moments.

Getting jobs and being successful atthem

According to research by Badgeville, by 2025, Millennials will be 75% of the globalworkforce. Today 15% are already in management with 1 in 10 makingover $100,000.

Millennials age 25 -34 have recovered nearly 75% of jobs lostduring the recession according to Dick Hokenson, an economist whoheads ISI Group's Global Demographics Research team, citedin a Barron's article last year.

Getting married

In the same report previously cited from the Pew, the toppriorities for the Millennial generation is not texting or partyingas some jaded pundits might argue. Instead the top 4 concerns pointto socio-economic opportunities. According to PEW datamillennial priorities are:

1. Being a good parent
2. Having a successful marriage
3. Helping others
4. Owning a home

Buying power

In 2012, clothing retailer Macy's launched a new strategy aimedat Millennials.Not to capture Facebook attention or Twitter. But to capture ashare of the more than $65 billion spending power of Millenials.Yes, Millennials are spending. Yes, they have money to spend.

As Millenials continue to recover from the recession shock andachieve their goals of marriage and family, they will spendmore. It's a scenario that Macy's is not alone in bettingon. Ford Motor Co. and Chevy are also staking big claims for the dollars (that some say Millennialsdon't have and aren't spending). In fact, Ford saw a whopping 80%increase from the first half of 2009 to the first half of 2013 insales among shoppers 18-34. Millennials are buying cars.

Tempered enthusiasm

It's slow going for sure, for a generation with more than $1trillion in student loan debt, however there are signs that thelargest generation is starting to move. Signs that can't beignored. Regardless of how you want to slice the data, when thegeneration is ready to spend, do you want to be closed forbusiness? Let's just table whether or not Millenials as a buyer,matter.

The facts: Digital influence

Get your snake oil! Get your snake oil here!! No onelikes a snake oil salesman and no one likes to be scared either butthe truth is that there is no such thing as a millennial-orientedproduct when it comes to digital strategy. One only needs tolook at the myriad reports, data and trends to see that mobile,social and digital adoption is not a millennial-only trend.

Mobile

Mobile phone and smartphone usage is not a millennial onlytrend. A report from Forrester and broken down by emarketer sheds some interesting light. Assume you ignore“millennial-only” products related to mobile banking, mobilewallets and NFC. You've now ignored 93% of the U.S. marketthat has mobile phones, not to mention the 50% that has smartphones as of January last year. (In all honesty, these numbers aresubstantially higher today, as the rate of mobile adoption hasincreased at a blistering pace.)

Even debating mobile strategy seems risky. Mary Meeker, aventure capitalist and former Wall Street securities analyst nowfamous for her internet trends reports has some interesting data around mobileadoption.

Boiled down. Smartphone use is in its infancy.

Those annoying little devices at dinners and meetings may seemubiquitous, but globally we've only reached 1.5 billionsubscribers, a growth rate of 31% and penetration of 21%. Buthold your horses … tablet adoption is even more rapid, at a rate of3 times.

The future

While the debate rages whether or not to take on mobile bankingto appeal to those pesky Millennials, Googlequietly acquired thermostat company Nest. (Maybenot that quietly.) Why on Earth would they do that?

Because. While mobile phones are at 94% adoption in the U.S andthere is still 80% global market share for smartphones to capture,and tablets are growing at 3 times the growth rate of smart phones:technology innovators are on to wearables, flyables, scannables andthe internet of things and early adopters will be the ones pushingahead how the rest of us use those.

Pay attention to the early adopters, don't ignore them.

Diffusion of innovation

In 2004 a few thousand students started joining a website. Tojoin, you had to have an email address that ended in .edu. You knowwhere I'm going with this. Today, with more than 1.19 billion monthly active users, Facebook has affected theway we communicate with each other; get news and brands reach usand is also a perfect example of the diffusion of innovation.

The diffusion ofinnovation explains how technology in particular becomesmainstream. Without diving deep into the theory, the key hereis that looking at the theory and understanding adoption patterns,technology lifecycles can become great predictors of mainstreamadoption. Ignoring this time tested theory is precarious for anybusiness strategy.

94 reasons digital matters

With only 6% of the financial services market share, creditunions have an enormous opportunity to position themselves to winthe battle for market share on the technology front.

Full disclosure

Every generation has its trials and tribulations and isenlightened in it's own way. To preclude any generation frombuying power is absurd when you're dealing with population numbersin the millions. Further, each member of each generation has astory of their own and we can't forget that. Individually we aren'tstatistics no matter what generation we belong to.

However, when it comes to strategy and how technology adoptionrates play a role, this doesn't become a discussion aboutgenerations. This becomes a discussion about trends andlifecycles.

I am a product of the millennial generation. I've worked hard toget where I am. I have a mountain of student loan debt that I willbe paying off most likely as my children head off to college. I sawmy parents' retirement fall out from under them so I'm cautiousabout following the traditional retirement savings advice. Yes, Iam jaded by the economic policies from the financial know-it-allswho caused many of the problems of the last recession. I'm recentlyengaged. I bought a car this year. I'm preparing to considera new home.

There are a lot of things about the financial world I'm stilllearning. But what I don't need is credit counseling. I need to notbe talked down to by my financial partners. What I do need IS apartner.

Meet me where I am, online, social and on-the-go. I'm tired ofbeing talked down to and treated like a generation that doesn'tmatter, or that the disruption of our influence in technology tonot just the financial industry but nearly every industry issomething to be scoffed at or ignored.

But more importantly, I'm optimistic. I'm optimistic that thegreatest days lie ahead for me, for our country and for the creditunion industry that embraces change and keeps moving forward.

Ryan Ruud is vice president of marketing at theMinneapolis-based marketing firm result150.

Read the counterpoint: Gen Wait: MillennialsUnderbanked, Underfunded …

Gen Wait: Millennials Underbanked, Underfunded

By Robert Bessel

Who do you love more – theMillennials, the pundits who talk about Millennials, or the creditunions who offer all sorts of products to capture the Millennialdemographic?

Let's start with the Millennials themselves – the most hypedgeneration of all time. They were first introduced in 1981 as the“Echo Boomers.” They evolved into “Gen Y” – a weird mix of Gen Xand Y2K. When the world didn't end on Jan. 1, 2000, Gen Y becamethe “Millennial Generation.” It's more dignified – right? But tocredit unions they are becoming known as “Gen Wait.”

This last moniker reflects a dawning realization that theMillennial generation is waiting to do everything that matters to acredit union. Millennials are simply not buying cars or houses.They're not getting married, having children or planning forretirement. Why? Because college debt, high unemployment orunderemployment has crowded everything else out of the typicalMillennial's wallet.

According to demographer Ken Gronbach, the Millennials or Gen Ywill need to become far more entrepreneurial or face upwards of 50%unemployment. A startling forecast.

The pundits have made quite a living from scaring credit unionsinto Millennial-oriented products. Mobile banking, mobile walletsand NFC are all great products. There's just one problem: TheMillennial audience doesn't have enough disposable income to takethat first bite of the credit union's apple.

All the mobile banking in the world won't bring a horde ofunderbanked Millennials to a credit union's door. And guess what?Not having mobile banking isn't preventing them from visiting. Theysimply don't have the money to get started!

Credit union managers – let's not all weep at once. TheMillennials are missing out big time, too. They have little to noexposure to financial basics – like shared draft accounts,budgeting and nickel-at-a-time savings plans. Case in point – myMillennial son who thought that standing in line to buy moneyorders was the best way to pay his bills.

What's the scariest part of the story? Every time I tell it tothe parents of a Millennial, they nod their heads and tell me,“Mine, too.”

Given that the last enlightened generation – the Baby Boomers(and the small and over- indulgent Gen X, the group between theBoomers and Y) – whose finances have been challenged by difficulteconomies and overall poor planning, what hope do we have for theMillennials' financial future? They will awaken to financialreality later than any generation before them. As a result, theyare guaranteed to have even fewer assets saved for retirement whenthey need them.

All the talk about banking channels ignores one simple fact –the Millennial generation needs credit counseling more thananywhere, anytime banking. They need knowledge. They need tools tomodel their future. They need advice. They need products that willhelp them escape their financial black hole. They need ongoingsupport.

Does your credit union want to attract and retain the Millennialgeneration? These ideas might be the most effective way to doit.

RobertBessel is public relations directorfor COCCInc. in Avon, Conn.