Microsoft Issues First Global Survey of Millennials and Banking Channels

ORLANDO, Fla. — Nov. 18, 2008 — Banks seeking to capture customers of the so-called Millennial generation people between the ages of 18 and 30 may need to step up their efforts to reach them via higher-tech channels, including instant messaging, text messaging and more, according to a new survey released today by Microsoft Corp. at the BAI Retail Delivery Conference & Expo.

The “Millennials in Banking Survey 2008,” conducted for Microsoft by Pleasanton, Calif.-based Javelin Strategy and Research, found that Millennials predominantly go online for most basic transactions with their banks, such as viewing an account balances (74 percent) or paying bills (70 percent). As is to be expected, when it comes to complex transactions — such as opening a new account (57 percent) and applying for a loan (52 percent) — their preference is to conduct those in person.

However, of those Millennials who chose online as a primary channel, 15 percent prefer talking to customer service representatives via instant messaging (IM). In particular, Canadian Millennials prefer IM at twice or greater the rate of those surveyed for activities such as receiving financial advice (15 percent), opening a new account (14 percent) or applying for a loan (12 percent). In addition, Australian Millennials reported nearly double the preference to receive account alerts via text (23 percent) of the audience as a whole.

“In this difficult economic time, banks are understandably eager to attract and retain new customers, particularly the estimated 80 million1 tech-savvy Millennials who have entered or are soon to enter the work force,” said Rich Feldmann, U.S. banking industry solutions director at Microsoft. “This survey shows banks need to consider a wide variety of channels to reach these tech-savvy Millennial consumers, and ultimately drive seamless integration across the Web, branches and phone.”

Millennials Tech-Savvy in Day-to-Day Lives

As is to be expected, Millennials queried in the survey reported using a wide variety of technology tools and services every day, including mobile phones (89 percent), smartphones or PDAs (20 percent), MP3 players (71 percent), text messaging (83 percent), and instant messaging (75 percent). The Web also featured prominently in their responses, as Millennials frequent social networking sites (87 percent), conduct Web-based search (92 percent), access Web-based e-mail (88 percent), conduct research using online Wikis (59 percent), and post to personal blogs (28 percent) or their own Web sites (26 percent).

“Millennials have embraced digital technology early in their lives, and thus their technological expectations in interacting with service providers are high,” said James Van Dyke, president of Javelin Strategy & Research and an expert on the banking industry. “Banks need to be very conscious of this when attracting or retaining Millennials as customers, as they require more tech-forward, easy-to-use and interactive interfaces across channels.”

Bank Selection Criteria for Millennials

When choosing a new financial services provider, the qualities Millennials rank highest include competitive rates and fees (53 percent), online service capabilities (37 percent), access to ATMs (35 percent), customer service (32 percent), superior security against identity fraud (30 percent) and access to branches (26 percent) mirroring most common consumer preferences.

However, while Millennials in all four surveyed countries reported rates and fees as the top quality desired for their bank of choice, the second- and third-most desired qualities differed by country, with Canadian Millennials ranking access to ATMs (38 percent) as second-most important, and U.K. Millennials ranking strong security (34 percent) as third-most important.

When researching or learning more about financial service providers with whom to open accounts, Millennials ranked the following in order of significance:

  • Asking friends, family members or co-workers (65 percent)

  • Visiting the provider’s Web site (58 percent)

  • Reading customer reviews on the Web (26 percent)

  • Reading news articles (22 percent)

  • Reading professional reviews from Consumer Reports, etc. (26 percent)

“It’s critical for banks to offer an easy-to-use, informative Web site, because Millennials particularly those from Australia rank this as a key way to gather information about the institutions they want to do business with, and online service capabilities also remain a top quality Millennials seek from their providers,” Van Dyke said.

About the Microsoft “Millennials in Banking Survey 2008”

Pleasanton, Calif.-based Javelin Strategy and Research conducted the Microsoft “Millennials in Banking Survey 2008” in November 2008, analyzing consumer data from an online survey of more than 1,600 banking Millennials. The respondent base comprised approximately 600 Millennials in the United States, 200 in Canada, 400 in the United Kingdom and 400 in Australia. For the purposes of this study, Millennials are defined as individuals between the ages of 18 and 30 years old. The full survey results are available for download at

About Microsoft in Financial Services

Microsoft’s Financial Services Group provides software that helps financial firms transform the customer, employee and operations experience so they can maximize opportunities for increased market share and profitability. Microsoft software helps empower people and IT staff within financial firms — and across key focus areas such as advisor platforms, channel renewal, insurance value chain, enterprise risk management and compliance, and payments. Through a combination of Microsoft- and partner-provided solutions, customers enable their employees to turn data into insight, transform ideas into action and turn change into opportunity.

More information about Microsoft’s Financial Services Group can be found at

About Microsoft

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

1 Source: U.S. Bureau of Labor Statistics.

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