Echo Boomers and Finance - US

Published by: Mintel International Group Ltd.

Published: Sep. 1, 2009 - 64 Pages

Table of Contents

SCOPE AND THEMES

What you need to know

Consumer survey data

Online surveys

Greenfield Online

Experian Simmons National Consumer Studies

Advertising Creative

Abbreviations and terms

Abbreviations

Companies mentioned in this report:

EXECUTIVE SUMMARY

Industry overview

Market Size and Forecast

Competitive Context

Marketing Channels

Market Drivers

Innovations and Innovators

Advertising and Promotion

The Consumer

Cluster Analysis

MARKET SIZE AND FORECAST

Key points

Who are Echo Boomers?

Echo Boomers are even more numerous than Baby Boomers

Banking product ownership increases rapidly as Echo Boomers mature

Figure 1: Banking products currently owned: Echo Boomers indexed to total, by age, February 2008-March 2009

Figure 2: Banking products currently owned: Younger vs. older Echo Boomers, February 2008-March 2009

Echo Boomers are just embarking on financial product ownership

Figure 3: Investment products/accounts currently owned: Younger vs. older Echo Boomers, February 2008-March 2009

Figure 4: Investment products/accounts currently owned: Echo Boomers indexed to total, by age, February 2008-March 2009

Echo Boomers aspire to greater ownership of financial products

Figure 5: Financial products own and plan to get: Echo Boomers indexed to total, February 2008-March 2009

COMPETITIVE CONTEXT

Key points

Financial services companies are beginning to reach out to younger adults

Figure 6: Direct mail, email, print campaigns mentioning “Echo Boomer/Gen Y/Generation Y/Millennial,” vs. “Gen X/Generation X,” vs. “baby boom/baby boomer,” June 2008-May 2009

MARKETING CHANNELS

Key points

The internet is displacing traditional media as an information source for Echo Boomers and Gen X

Figure 7: How the internet impacts getting product information and shopping, by generation, February 2008-March 2009

Figure 8: How the internet impacts use of other media, by generation, February 2008-March 2009

Financial services companies are shifting their advertising more and more to online media

Figure 9: Advertising expenditures for financial services companies, 2008

Echo Boomers have strong opinions about what they want in a website

Figure 10: Website attitudes, by generation, February 2008-March 2009

Newspapers face dismal prospects

Figure 11: Newspaper readership, by generation, 2006 vs. 2008

Marketers can still reach Echo Boomers via TV—although TV viewing modes are becoming more

fragmented

Figure 12: Average number of hours spent per month watching TV/using internet, by age, Q3 2008

Direct mail can get through to Echo Boomers

Figure 13: Amount of weekly mail received per age group, 2003

MARKET DRIVERS

Key points

Echo Boomers represent the next generational bulge

Figure 14: U.S. population estimates, by generation, 2009

Echo Boomers are more diverse than previous generations

Figure 15: U.S. population estimates, by race/ethnicity, 2009

INNOVATION AND INNOVATORS

Key points

Credit unions are leading innovators when it comes to Echo Boomers

Some banks are also portraying themselves as the anti-bank

Some financial brands use social networking sites to engage Echo Boomers

ADVERTISING AND PROMOTION

Key points

Managing credit

Figure 16: Freecreditreport.com television advertisement, 2009

No gimmicks

Figure 17: Ally Bank television advertisement, 2009

The unexpected: Introducing an element of chaos

Figure 18: Nationwide insurance television advertisement, 2008

Tech-savvy ads

Figure 19: E*Trade television advertisement, 2008

Figure 20: Chase credit card advertisement, 2008

THE CONSUMER

Key points

Echo Boomers already have a lot of financial concerns

Figure 21: Primary financial concerns: Echo Boomers indexed to total population, June 2009

Echo Boomers see themselves as unique and want to be treated as such

Figure 22: Attitudes towards generational marketing, by age, June 2009

Echo Boomers may be ahead of their older Gen X counterparts in savings

Figure 23: Financial attitudes of Echo Boomers and Gen X, 2008

Debt is already a problem for Echo Boomers but not as much as for Gen X

Figure 24: Types of debt for Echo Boomers and Gen X, 2008

Figure 25: Most important goal in next ten years for Echo Boomers and Gen X, 2008

Echo Boomers are still optimistic about their future prospects

Figure 26: Echo Boomer and Gen X perceptions of being behind schedule for key life milestones, 2008

The economic downturn may have had less impact on Echo Boomers

Figure 27: Perceptions of whether achieved the American Dream, 2008 and 2009

Figure 28: Economic outlook: Echo Boomers indexed to total, February 2008-March 2009

Figure 29: Investment losses in past year, by age, February 2008-March 2009

Echo Boomers admit lack of financial knowledge and discipline

Figure 30: Financial attitudes, by generation, February 2008-March 2009

Echo Boomers are making financial adjustments in response to the economic crisis

Figure 31: Steps taken as a result of economic crisis, by generation, 2009

Figure 32: Steps plan to take or have taken as a result of economic crisis, by generation, 2009

The economic downturn may be the impetus for greater financial responsibility among young adults

Echo Boomers admit that they are not very knowledgeable about many financial basics

Echo Boomers are motivated to learn more about financial matters

Figure 33: How prepared Echo Boomers feel to make good financial choices, 2009

To some extent Echo Boomers see themselves as paying the price for their parents’ financial misdeeds

Figure 34: Financial attitudes: Echo Boomers indexed to total population, June 2009

Echo Boomers are not turning away from the financial system in response to the economic crisis

Figure 35: Changes in financial behavior as a result of economic crisis, by age, June 2009

Echo Boomers still display some unsound financial practices

Echo Boomers are willing to give financial institutions another chance

Figure 36: Level of trust for U.S. financial system, by generation, 2009

Word of mouth is very influential with Echo Boomers

Figure 37: Reasons for bank choice: Echo Boomers indexed to total population, June 2009

Banks need to work hard to maintain loyalty of Echo Boomers

Figure 38: Incidence of switching primary banks in the past 12 months, by age, June 2009

Figure 39: Reasons for switching primary bank in the 12 months: Echo Boomers indexed to total population, June 2009

Parents are still very influential sources of financial advice for Echo Boomers

Figure 40: Major sources of financial advice for Echo Boomers and Gen X, 2008

APPENDIX: TRADE ASSOCIATIONS

Abstract

Like any new generation coming of age, Echo Boomers are in the process of establishing themselves in terms of jobs and households although for some the current economic environment may have slowed this progression. As the economy rebounds and comes out of recession, there may be a wave of pent-up demand as Echo Boomers again venture into the housing and car markets and turn to financial providers for both savings and lending solutions.

As young adults, Echo Boomers need to acquire greater knowledge of how to manage their personal finances and to learn about financial products and services. In some ways, this generation comes better equipped than their predecessors as they have access to vast amounts of information on the internet both from “experts” as well as peer commentary from blogs and social networking sites. In part, the challenge for this generation is too much information rather than not enough, and they need sources that present information that is targeted to their needs at this time in their lives. Financial services providers that can speak to this need will go a long way to establish a bond with Echo Boomers.

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