Understanding how to address this demographic – renowned for far shorter attention spans than previous generations – can be tricky when running a business that’s built on complexity and filled with confusing jargon.
This week our panel of brokers are discussing how they meet the needs of this growing audience and whether face-to-face advice is still king among a group so inherently connected with technology.
Paul Flavin, director, Zing Mortgages, describes the importance of recognising the preferred mediums used by millennials, but points out how face-to-face advice can help navigate young clients through the confusing terminology and processes within the mortgage market.
Conor Murphy, director, Capricorn Financial Consultancy, believes that mortgage brokers should make themselves available as much as possible in line with millennial’s expectations, but points out that technology is an enabler, rather than the be all and end all in giving advice.
Mark Dyason, owner, Edinburgh Mortgage Advice, says demonstrating the value of advice is the most important part of engaging with millennial clients.
In the world of mortgages, what sets the millennial client apart from what we could call the traditional client? To me the main difference is that millennials seem to be the first generation that have been raised fully immersed in technology. They’ve grown up with smartphones, Google and the like, and so do have different expectations.
The staff at Zing aged below 25 definitely do things I wouldn’t even have thought of – or been able to – when I was the same age. You ask them to do something for the first time and, if unsure, the first ports of call are Google and YouTube. A quick educational video clip later and they’re up and running. But because of this instant access to answers they don’t always see the need to retain information that’s viewed as irrelevant or only needed for that one situation. I recently saw a sign outside a church that summed the situation up perfectly. That actual sign said, ‘God has all the answers’ and below it someone had written ‘so does Google!’
However, when it comes to their first mortgage, a 30-second YouTube clip isn’t going to help much. They are also moving into a world filled with terminology that’s not readily understood such as tracker, fixed rate, standard variable and reversion rate. In this context, making the wrong decision could be expensive. The millennial client, like every other client, is anxious about securing their dream home, is baffled by what the correct process is and is happy to have someone they can trust to assist in any way possible.
At Zing we are looking at how we attract millennial clients. Social media plays a massive part in this. You need to be active on all platforms – Facebook, Twitter, Instagram and of course, YouTube. The value of the infomercial (as long as it’s less than two-minutes in length) cannot be underestimated. When more people under 25 watch YouTube than traditional TV then you suddenly have access to visual presentations previously too costly in other mediums.
This is how you attract the client but how you treat them once they’re on board is not so very different. Yes, you need to offer them the option to complete their own fact find, upload their own documents and so on, but, like other generations before them, they would generally prefer someone else to do the paperwork.
To attract and inform the millennial client we need us to embrace technology and social media in all its forms but from the moment they fall in love with their first home they are not that different to any other excited first-time buyer. They want to get into their home as quickly and painlessly as possible and to make this happen is the job of a good mortgage adviser.
Capricorn is a relatively young business; we have only been operating for just over 10 years and our average adviser age is 29. This ‘youth’ is reflected in the age profile of our clients and as a result a fairly high proportion of these are millennials. As they are normally just starting out on the house-buying journey and due to the transitory nature of the housing market in London and the relatively high-net-worth demographic that we work with, most opt for two-year products with a view to moving to a bigger property in relatively short order.
In terms of communication, our clients expect email and text as an absolute minimum, some like other forms of social media and we have also used WhatsApp, pretty much since its inception.
In common with most demographics now, there is an expectation with millennials to communicate and make yourself available outside the standard 9am to 6pm shift, and we have always done this and continue to do so. Our capabilities in this area are further enhanced by the state of the art technology that we have always used and continue to employ and invest further in. If clients can complete and edit forms 24/7 and communicate via a variety of mediums then they are normally pretty happy.
Having said all of that, there is no substitute for good, old fashioned, face-to-face advice. We see technology as an enabler and a way to make the process more efficient and more immediate, however, top quality advisers are still at the heart of everything we do and that will remain the same moving forward.
Millennial clients are becoming increasingly prevalent in the market as first-time buyers so as team we recently sat down to address some of our preconceptions about them and how we deliver a good service.
Face-to-face is important, but not for the whole process. Unlike some of repeat customers who look for an office visit at several points in the journey, our younger clients want time for the high value part of the transaction, the advice. For the remainder of it, including fact find details and application, this is what the internet and tech is all about. As a company we love this, it focuses the client facing part on the highest value part.
Product choice is often more about the property they can afford, however, the choice of term and what comfort level they have around payment amount is often a wider point of discussion; older clients often have far firmer budgeting ideas.
‘Gen Y don’t pay for things’ – except judging by the penchant for Apple products and Superdry clothes, if you offer them something they value then paying for it is no issue at all. It is all about making sure they understand the value of what you offer, in that way they are no different from all my clients. Although, I notice some don’t like to pay for razors or socks.
This must be a growing sector of our client bank so we are focused on getting better at being ready to help when they want it. We plan to launch a new website this year giving users better functionality, faster access to the adviser and add-ons such as live chat. As the bank of Mum and Dad that often supply the deposit finishes paying off their mortgage, we start a journey with these clients and want to be there throughout the homeownership journey they have.