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Millennials — defined as those born between about 1981 and 1997 — are more than 75 million strong, making them the largest and most influential generation  

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Changing Generational Gears: Tips for Marketing to Millennials

Jul 12, 2017

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Millennials — defined as those born between about 1981 and 1997 — are more than 75 million strong, making them the largest and most influential generation in the U.S. since the post-World War II “baby boom” generation.

The sheer generational size and, in turn, long-term spending power of millennials make them an attractive target for a spectrum of industries and marketers.

In a CNBC report, Sarbjit Nahal, Head of Thematic Investing Strategy at Bank of America Merrill Lynch, said millennials “are the most important group in terms of the workforce, and by 2018 they’re going to overtake the boomers. By 2025, we’re looking at over $8 trillion worth of annual net income.”

Business owners, like stakeholders in many other industries, have struggled to connect with millennials. But it is imperative that they do so — and soon. TSYS predicts that the current generational shift, as aging baby boomers earn and spend less and millennials earn and spend more, will create huge opportunities over the next decade for those who are prepared for the shift.

Here are three key insights to help small business owners and others understand how millennials approach financial decisions and transactions.

Insight #1: Millennials Quickly Adopt Technological Innovations

Millennials hold a strong preference for digital engagement, and thus it should be no surprise that mobile is their platform of choice. According to Forbes, 50 percent of Internet commerce was slated to become mobile commerce (m-commerce) through smartphones and tablets by 2015.

This means that business owners must be ready to provide an inviting and intuitive user experience, regardless of whether a consumer engages with them via laptop or mobile device.

Millennials are digital natives — the first generation to have grown up with Internet-enabled devices and digital technologies — and thus expect on-demand engagement with brands. They also have a low tolerance for poorly designed user experiences.

Insight #2: Millennials Have Less Brand Loyalty Than Earlier Generations but Engage with Brands More

Millennials aren’t as loyal to brands as prior generations — and they switch brands when they discover benefits to doing so. McDonald’s Global Chief Brand Officer, Steve Easterbrook, described the group as “promiscuous in their brand loyalty,” which “makes it harder work for all of us to earn the loyalty of the millennial generation.

Accenture found that 18 percent of millennials switched primary banks within the previous 12 months, compared with just 10 percent of customers aged 35-54 and 3 percent of those aged 55 and older. The generation’s tech-savviness, high level of social connectivity and concern about social responsibility lead them to research products and services thoroughly before making a purchase or becoming affiliated with a brand.

For businesses, that means millennials are likely checking out their websites and trying to better understand any product offer before making a purchase. Business owners who want to appeal to millennials will therefore need to make it easy for them to navigate their website and mobile app, while also providing clarity around product terms and conditions so millennials feel comfortable signing up.

While they may not be as brand-loyal as older generations, a Boston Consulting Group study found that U.S. millennials engage with brands much more extensively and personally when they do engage. Engaging more deeply means “liking” a brand’s social media posts, posting reviews and following brands they adore on Twitter or Instagram.

Younger millennials in particular believe that “brands say something about who I am….” One such example is millennials gravitating toward more local and specialized products, such as craft beers, which are increasingly being acquired by major brewing companies. The behemoth beer makers are trying to engage with the millennials in an authentic way while also trying to grow these craft brands. At the same time, they fear that the craft beer brand’s association with a big conglomerate will push millennials away.

However, risks abound: One bad experience can make it very difficult to win back a millennial. A bad experience could be a negative interaction with a company’s customer service line, such as being rerouted four times to have a simple question answered.

Insight #3: Millennials are More Apt to Use Alternative Payment Solutions

Millennials have shown gravitation toward alternative payment solutions. A survey conducted by credit-scoring company FICO found that “twice as many millennial respondents (32 percent) report that they are likely to use mobile wallet services like Apple Pay® or Google Wallet™ in the next 12 months as those who are 35 and older (16 percent).” Additionally, the survey found that “56 percent of the younger millennial segment (18-24) report that they are already using or very likely to use alternative payment services like Venmo and PayPal.”

For businesses, this means offering traditional and emerging ways to pay that match millennials’ digital lifestyles.


Businesses that better understand how millennials approach financial decisions and transactions and use this insight to deepen relationships will be in an enviable position. To achieve such a position, business owners must recognize that millennials truly represent the lion’s share of future revenue.

This TSYS Payments Perspectives post is adapted and excerpted from “Addressing the Generational Shift Among Cardholders: Strategies for FIs to Successfully Engage Millennials” a new TSYS White Paper by Jeff Hampton, director, Product Marketing, TSYS