Prepared by: Cyreeta Sharp

Rise of the Millennials: Capturing the Attention of a Generation

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Table of Contents:

I. Background …………………………………………………………………………… Page 3

a. Birth of the Millennials ……………………………………………… Page 3

b. Defining the Millennials: A Snapshot …………………………… Page 3

c. Key Findings About Millennials ..………………………………….. Page 4

d. Unique Characteristics and Attributes of Millennials …… Page 5

e. A Breed of Multitaskers ………………………………………………. Page 6

f. Entrepreneurs at Heart ……………………………………………….. Page 6

g. Billions of Dollars at Stake ……………………………………………. Page 7

II. Capturing the Attention of Millennials …………………………………… Page 7

a. Meet Millennials Where They Live: Social Media ………….. Page 9

III. Aligning the Trio: Millennials, Social Media and X COMPANY …………. Page 10

a. Finding Our Voice …………………………………………………………. Page 10

b. Aligning with X COMPANY Messaging and Initiatives …………… Page 10

c. Other X COMPANY Digital Enhancements Implemented to Reach Millennials …………………………………………………………. Page 12

d. X COMPANY Social Media Strategic Plan ……………………………… Page 13

IV. Summary ……………………………………………………………………………….. Page 15

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BACKGROUND Birth of the “Millennials” Renowned authors William Strauss and Neil Howe are widely credited with naming the “Millennials" after the duo wrote the book, Generations: The History of America’s Future, 1584 to 2069. They define them as 1982-born children who were entering preschool and born by 2000. Later, the phrase Generation Y appeared in an August 1993, Ad Age, editorial to describe children of the day, which they defined as different from Generation X—then aged 11 or younger as well as the teenagers of the upcoming ten years.1 In 2012, Ad Age "threw in the towel by conceding that Millennials is a better name than Gen Y," and by 2014, a past director of data strategy at Ad Age said to NPR "the Generation Y label was a placeholder until we found out more about them." Defining the Millennials: A Snapshot Generations are described as “a group of people who share common attitudes and behaviors that are the result of parental upbringing and exposure to social events during their younger, formative child and adolescent age years.”2 Although wide debates continue on the span of years that truly encompass the Millennial generation years, for the purpose of this report, the most commonly cited timeframe between 1981 and 2000 will be used. Given this, the Millennials total more than 92 million Americans (some data shows as high as 100 million) among the 312 million total U.S. population. In comparison, there are 61+ million in the Generation Xers, and 77+ million Baby Boomers. Suffice to say, Millennials make up an astounding percentage of the world’s population and play a vital role in the evolution of the American future. Under these guidelines, Millennials are widely credited as the social generation as they are the founders of the social media movement—constantly connected to their social circles via online and mobile. They prefer to live in dense, diverse urban villages where social interaction is just outside their front doors. They value authenticity and creativity, and buy local goods made by members of their communities. They care about their families, friends and philanthropic causes. But they

1 "Generation Y" Ad Age 30 August 1993. p. 16. 2 http://www.nielsen.com/us/en/insights/reports/2014/millennials-breaking-the-myths.html

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are also coming of age in the direst economic climate since the Great Depression–making their families, communities and social networks even more valuable as they band together.3 As cited by Dave Dawson, “Millennials are being influenced by the culture war between conservative and liberal political values and the resulting polarization of society. They are an activist generation that was raised to be confident of their abilities to control the world around them. Activism, confidence and control are key millennial traits that will continue to be seen in reaction to world events.”

Millennials are likely the most studied generation to date and seemingly full of contradictions, which, of course may explain the youth of any generation. Most consistent is that this generation is technically savvy. A wired, connected world is all that Millennials have ever known. Millennials are the most racially diverse generation in American history with 60% of 18-29 year olds classified as non-Hispanic white, versus 70% for those 30 and older. This reflects a record low of whites with 19% Hispanic, 14% black, 4% Asian, and 3% of mixed race or other. Additionally, 11% of Millennials are born to at least one immigrant parent.4 A major factor behind this trend is the large wave of Hispanic and Asian immigrants who have been coming to the U.S. for the past half century, and whose U.S.-born children are now aging into adulthood. The racial makeup of today’s young adults is one of the key factors—though not the only one—in explaining their political liberalism. 5

3 http://www.washingtonpost.com/blogs/wonkblog/wp/2015/02/28/8-things-millennials-want-and-dont-want-basically-anything-their-parents-wanted/ 4 Pew Research 5 Pew Research

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Key Findings about Millennials6 Social: Millennials have fewer attachments to traditional political and religious institutions, but they connect to personalized networks of friends, colleagues and affinity groups through social and digital media. Half of Millennials now describe themselves as political independents and 29% are not affiliated with any religion—numbers that are at or near the highest levels of political and religious disaffiliation recorded for any generation in the last quarter-century. Financial: Millennials are more burdened by financial hardships than previous generations, but they’re optimistic about the future. Millennials are the first in the modern era to have higher levels of student loan debt, poverty and unemployment, and lower levels of wealth and personal income than their two immediate predecessor generations had at the same age. Yet, they are extremely confident about their financial future. More than eight-in-ten say they currently have enough money to lead the lives they want or expect to in the future. Few Millennials believe that Social Security will provide them with full benefits when they are ready to retire, but most oppose cutting current benefits as a way to fix the system. About half (51%) of Millennials believe they will get no benefits from Social Security and 39% predict they will get benefits at reduced levels. However, much like older adults, 61% of Millennials oppose benefit cuts as a way to address the long-term funding problems of Social Security.

Unlike earlier generations, Millennials are in no hurry to buy their first home – including the trend of leaving their parent’s nest later or returning back to their families homes after launching out on their own. This is often referred to as “boomeranging.” According to an infographic from Goldman-Sachs, 15% of Millennials say “it is extremely important to buy a home,” 25% say “they might purchase one if really need it but indifferent otherwise,” and 5% don’t feel strongly about it.7

Additionally, 13% have “boomeranged” back to their parents’ homes because of the recession after living on their own and 36% say “they depend on financial support from their families.”8 In fact, research and a number of articles have explained that many Millennials have grown up with parental support and encouragement and have experienced relatively comfortable lifestyles.9 6 Pew Research 7 Goldman-Sacchs Millennial Infographic 8 Pew Research 9 Education: Editorial Projects in Education Research Center (2011) National Graduation Rate Rebounds (edweek.org/media/diplomascount)

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While education is expensive, education levels had more effect on earnings over a 40-year span than any demographic factor. Earnings increased incrementally for those with some high school, with a high school diploma, with a bachelor’s to those with an advanced degree. The difference in earnings over the 40 years by level of education can be in the millions of dollars. This will help Millennials with their average $25,000 student loan debt. For the first time America, there is now more student loan debt than credit card debt. 10 Money is a key focal area for Millennials and that means they’re price conscious and deal savvy. But they’re not clipping coupons from the Sunday paper the way their Boomer parents do. Rather, they’re using social media apps to seek out the best deals and promotions. Deals actually account for 31 percent of their shopping dollars, and many of the top apps used by Millennials are either retail or discount focused, with Amazon Mobile and Groupon topping the charts.11 LIfestyle: Singlehood sets Millennials apart from other generations. Just 26% of Millennials are married. When they were the age that Millennials are now, 36% of Gen Xers, 48% of Baby Boomers and 65% of the members of the Silent Generation were married. Most unmarried Millennials (69%) say they would like to marry, but many, especially those with lower levels of income and education, lack what they deem to be a necessary prerequisite—a solid economic foundation. Millennials are less trusting of others than older Americans are. Asked a long-standing social science survey question, “Generally speaking, would you say that most people can be trusted or that you can’t be too careful in dealing with people,” just 19% of Millennials say most people can be trusted, compared with 31% of Gen Xers, 37% of Silents and 40% of Boomers. Unique Characteristics and Attributes of Millennials According to Strauss & Howe there are seven core traits of the Millennial Generation. On the whole, these are not traits one would have associated with Silent, Baby Boomers, or Generation Xers in youth—though many are remembered from the days of G.I. Generation teens. Special: From precious-baby movies of the mid-1980s to the media glare surrounding today’s young workers, older generations have inculcated in Millennials the sense that they are, collectively, vital to the nation and to their parents’ sense of purpose. Sheltered: From the surge in child-safety rules and devices to the post-Columbine lockdown of public schools to the hotel-style security of today’s college dorm rooms, Millennials have been the focus of the most sweeping youth-protection movement in American history.

10 Education: Editorial Projects in Education Research Center (2011) National Graduation Rate Rebounds (edweek.org/media/diplomascount) 11 http://www.nielsen.com/us/en/insights/news/2014/millennials-technology-social-connection.html

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Confident: With high levels of collective optimism and a focus on positive solutions for big problems, this generation is striking an upbeat new tone about their own—and the nation’s—future. Team oriented: From youth soccer and social networking to collaborative learning and community service, Millennials are developing strong team instincts, tight peer bonds, and a rising sense of civic engagement. Conventional: Taking pride in their improving behavior and comfortable with their parents’ values, Millennials provide a modern twist to the traditional belief that social rules and standards can make life easier. Pressured: Pushed to work hard, plan for the long term, and take full advantage of the opportunities offered them, Millennials feel a “trophy kid” pressure to excel, both in the classroom and in the workplace. Achieving: As accountability and higher school standards have risen to the top of America’s political agenda, Millennials have become a generation focused on achievement—and are on track to become the best-educated young adults in U.S. history. Even with all their nuances, Millennials are considered optimistic, with 41% satisfied with the way things are going in the country, compared with 26% of those over 30.12 This optimism abounds even after collectively sharing a plethora of tragic events that have shaped this generation, such as 9/11, terrorist attacks, school shootings, the 2004 Southeast Asian tsunami and hurricane Katrina. A Breed of Multitaskers Millennials are described as extraordinary multitaskers who have the ability to switch tasks quickly enough to appear to be doing them simultaneously. When it comes to heavy media multitasking, studies show greater vulnerability to interference, leading to decreased performance. Some studies suggest that this generation is rewiring the brain with extensive multitasking training evidenced by the teenager who can simultaneously play video games, watch TV and do homework. This rewiring allows multiple tasks to be processed in more rapid succession. This activity and research suggest that our brains are evolving. Entrepreneurs at Heart Though research varies, half to two thirds of Millennials are interested in entrepreneurship, and more than quarters (27%) are already self-employed. Males, blacks, and Latinos are most

12 (Pew Research Center (2009) Millennials Confident. Connected. Open to Change. http://pweresearch.org/pubs/1501/millenials new study)

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inclined toward starting their own business; females are more likely to be interesting starting nonprofits.13 The young entrepreneur has achieved star status - think Mark Zuckerberg of Facebook or Andrew Mason of Groupon. Small business is regarded as a driver of the U.S. economy, providing jobs for the nation’s private workforce. Starting a business can look very appealing.14 In 2011, many took the leaps and launched almost 160,000 startups each month, and 29% of all entrepreneurs were 20 to 34 years old. Billions of Dollars at Stake This generation is large and with their numbers come substantial buying power, both through their own increased earnings as they are and through the financial support of their Baby Boomer and Gen X parents. Not only do Millennials contribute to the market directly, their “early adopters” purchasing behavior also influences others to buy products and services. Reports on Millennial annual purchasing power widely range between $125 billion and $890 billion. A more consistent estimate is $200 billion of direct purchasing power and $500 billion of indirect spending, largely due to the influence on the spending of their mostly baby boomer parents. They are also changing the means and speed by which marketplace information is exchanged. Millennials add contact through the constant connectedness and the popularity of social media, keeping marketers on their toes. This generation’s connectedness also demands that brands ensure or influence that the user experience is positive. Savvy marketers will broaden their reach across gender lines to take advantage of the larger, more diverse potential market for their products. CAPTURING THE ATTENTION OF MILLENNIALS Given that this generation thrives on social connection, it is fitting to note that the best way to connect with Millennials is by technology.

Millennials main sources for news are television (65%) and the Internet (59%) Lagging behind are newspapers (24%) and radio (18%). Millennials are never far away from their next text, with 80% sleeping with their cellphone next to the bed.15

13 U.S. SMall Business Administration (2012) FY 2012 Congressional Budget Justification. (sba.gov/sites/default/files/legacy/foundation/FINAL%) 14 Buzz Marketing Group and the Young Entrepreneur Council (2011) 2011 Youth Entrepreneurship Survey 15 Millennials in the Marketplace: (us chamber foundation)

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The Millennial generation, is the first to come of age with cable TV, the Internet and cell phones, so technology is essentially baked into every Millennial’s DNA. Their relationship with technology has completely changed their relationships with most everything. With brands and services, what used to be a one-way conversation is now a multifaceted, 24-hour-a-day, seven-day-a-week dialogue between brands and their customers and among their customers. They have the confidence to stand up for what they believe and the confidence, technology, and network to voice their opinions. With Millennials, brands know where they stand, sometimes even minute to minute. According to one survey, 86% of Millennials are willing to share information about their brand preferences online, making it a top personal identifier.

Marketing and advertising at its essence has changed dramatically. Long gone are the traditional sales and buying cycle – awareness, consideration, preference/intent, purchase and repurchase. With the influx of technology, customers (most notably Millennials) have greater access and control to information outside of a one-way stream of branding and marketing from companies.

Now, there is a concept of “Zero Moment of Truth” (ZMOT),16 which is the crux of where consumers conduct their research and data about their purchases. ZMOT occurs right after their first introduction to a product/service – after they buy it and test it.

To explain this further, Millennials are most accustomed to relying on recommendations or their own individual research about a product before they purchase. They will often bypass a company’s flowery messaging and conduct their own independent analyses of what they will buy. Because of this, the duty is on businesses to connect with Millennials at their ZMOT and give them all the tools and data they need to guide their purchasing decisions. Companies have the added burden of proactively reaching these savvy consumers at specific moments of time members or prospective members have in contact with our products and services.

This is where technology comes in.

There are more than 12 billion online searches per month and 187 million unique visitors online per month. The shift to mobile is equally astounding with 1.2 million mobile users.

By 2018, it is expected that mobile users will reach more than 5 billion. In fact, 87% of all devices connected to Internet are smartphones and tablets and only 13% are connect using desktop computers or laptops.

But Millennials aren’t just using technology to connect with friends. Their comfort level with digital has them engaging online in ways other generations are just warming up to. For example, Millennials like to handle their finances themselves, and they primarily do so online. And their savvy extends beyond balancing their checkbooks. Older Millennials are 28 percent more likely than average to buy mutual funds online. And, both younger and older Millennials

16 Digital Marketing Summit

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are more likely than their older counterparts to engage in online trading. They’re also the heaviest Internet bankers and most likely to purchase insurance online. Meet Millennials Where They Live: Social Media In order to expand as an organization, our goals and strategies must align with social media, as more than 75% of Millennials have created a profile on a social networking site and spend an average of 1.8 hours on social media sites. Most Millennials use at least two Internet devices every day. A minority use three or even four — 37 percent in the US. The survey also found that “19 out of 20″ Millennials (globally) own smartphones and check them an average of 43 times per day (in US it’s 45). Social media are by far the dominant way these respondents learn about things online. Search engines are ranked near the top but fall below Facebook and Twitter for content discovery. Accordingly the advice is to build relationships and trust with Millennials first on social media.17 To be effective, advertising should be placed around engaging content. On average, engagement is higher among Millennials than other generations for television and website, on a percentage basis it is greater on the Web than on TV. Millennials are highly engaged with content they choose to view online and on TV, with amplifies the effectiveness of ads for this group.

Early adopters: Millennials are 2.5 times more likely to be early adopters of technology than are older generations.

Content Authors: They are more likely to use the Internet, broadcast thoughts, and contribute content. Millennials stand out when it comes to producing and uploading online content (60%) compared with non-Millennials (20%).

Multi-Channels: Although Facebook is popular among all adults under age 35, younger Millennials are even more likely to use a mix of social networks for news than older members of this generation. The average 18-to-21-year-old uses 3.7 social networks out of seven platforms asked about in the survey. For the average older Millennial age 30-34, that decreases to 2.9.

17 http://marketingland.com/survey-best-way-reach-millennials-social-media-91241 http://www.adweek.com/socialtimes/rise-millennials/494884

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The reasons they use Twitter are related but slightly different than the reasons they turn to Facebook. Twitter is a place to learn about what people in general are talking about, not just the lives of people they know. For instance, the number one reason these Twitter users say they use the social platform is to see what’s “trending” and what people are talking about (43 percent). The number two reason is to find things that entertain them, such as funny lists, articles, or videos (40 percent). 18

ALIGNING THE TRIO: MILLENNIALS, SOCIAL MEDIA AND X COMPANY Finding Our Voice As outlined, Millennials thrive on connectedness, peer engagement and recognition. X Company’s engagement in social communities must reflect a personable tone that makes our brand and financial experts knowledgeable and relatable. The voice must speak to from a knowledge-based standpoint, but with an air of: “I’m like you” “I understand how difficult it may be to manage your finances” “Don’t worry, let me explain how everything works” “Unlike banks, we’re a community and we want to take the time to help you”

In addition, the voice needs to reflect the Southern California culture – which is typically younger and urban – and not just an overarching spectrum of Millennials. Aligning with X COMPANY Messaging and Initiatives Social media as it relates to the initiatives of X COMPANY should be viewed as an extension of the branding and marketing efforts already in place. The use of this added communication vehicle is a supplementary arm to strengthen how we currently communicate to members and prospective members. While seemingly foreign to the many, and an enormous marketing vehicle for attracting and retaining Millennials, there is a rhythm and a systematic science already in place that X COMPANY to benefit from. Goal of utilizing social media:

Primary: To engage Millennials members (and prospective members) by empowering them to be financial knowledgeable and savvy, provide them with timely resources to manage their finances and connect with them as members of the communities in which X COMPANY serves.

Secondary: serve as a two-way communication tool to monitor our members’ experiences and thoughts of X COMPANY’s products and services – while discerning opportunities to make changes to meet needs of our members and attract new members.

18 http://www.nanigans.com/2015/01/14/understanding-how-millennials-shop-online/

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Competitive Landscape: Mountain America Credit Union, America First Credit Union, Golden One Credit Union and Vancity Credit Union are listed among the top credit unions on social media in America. The common thread with all of these credit unions is the following:

YouTube videos with financial experts sharing information Weekly contests and giveaways Close connection with the community – sponsorship of community events Charity involvement and donations Member appreciation events

In observing best learning practices, X COMPANY can benefit from building a stronger connection with the communities which we serve and grow our social communities through organic engagement. X COMPANY Social Communities: Facebook Twitter Yelp YouTube LinkedIn

Measuring Pace and Saturation of Social Marketing Arena: Unlike other forms of marketing and advertising measurements of success, ROI’s are not as easily seen with social media. However, there are a myriad of ways that we can track and measure the effectiveness of activities, organic and paid campaigns.

Reach – Numbers, demos, overlap and frequency. Brand Resonance – Changes in perception. Reaction – Impact on sales and maximizing efficiency across channels Consumer Insights – Insights about consumer behavior, product and brand that can improve

the credit union. “Fan” Reach Percent - to understand how many fans we are currently reaching, while also

providing insight into how frequently to send messaging to maintain a consistent content conversation.

Content Reach Percent - measure the reach of each post (impressions) which helps provide insight into X COMPANY’s EdgeRank score. (Facebook’s algorithm that determines what content a user sees in their newsfeed).

Content Engagement Rate - to understand how consumers engaged with the posted content.

o Unique visitors, impressions, engaged users, check-ins at branches, people talking about X COMPANY.

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Campaign tools: Utilize the top social sites for businesses and where other financial institutions have experienced success. With these sites, campaign efforts can be specifically designed with the following:

Geo-targeting (by branch locations) Demographics (by Millennials) Expanded video capabilities Keyword-targeting Retargeting (importing email addresses of current

members to specifically target)

Other X COMPANY Digital Enhancements Implemented to Reach Millennials Responsive Design Website The new wpcu.org was built using a “responsive design” model which allows viewers an optimal viewing experience—easy reading and navigation with a minimum of resizing, panning, and scrolling—across a wide range of devices (from desktop computer monitors to mobile phones). Given the characteristics of Millennials and their desire to have information readily available to them in an array of formats, this positions X COMPANY as a partner with members in accessing their financial information and resources on-the-go. An added bonus to the launch of the new website is the timing of Google’s new algorithm to be more favorable with "mobile-friendly" websites which will positively impact the weight search results served to mobile devices. Mobile Optimized E-Blasts In April, we introduced a monthly e-newsletter in a mobile-friendly format. This allows subscribers to have the latest news and promotions about X COMPANY delivered to their email and can be easily viewed on smartphones, tablets and desktop computers. Most notably, it is an efficient way to reach Millennials on-the-go. X COMPANY Social Media Strategic Plan

Active X COMPANY Social Communities: Facebook (558 Likes) Twitter (357 followers) LinkedIn (72 followers)

Active Review Sites Listing X COMPANY: Yelp (Yahoo Local) CreditKarma Yellow Pages / Super Pages FourSquare

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Current Social Networking Strategy: Facebook: Weekly posts to engage Millennials members and prospective Millennial members with financial news, information on financial resources and content, as well as upcoming X COMPANY promotions and branch events, and other relevant resources. To engage Facebook followers we have developed a social media calendar which encompasses the following: Financial news and resources Information on current X COMPANY campaigns and promotions Links to current X COMPANY newsletters Contests and promotions Product features Generational finance information and tips (Gen X, Gen Y, etc.) Member testimonials X COMPANY community involvement Use sites such as SocialBro or hashtags.org to mine for trending topics

Twitter: Weekly tweets sharing relevant financial content and resources for Millennials and also like-minded institutions that service Millennials. Twitter is also being used as a means of increasing X COMPANY’s presence as a premier credit union in Los Angeles and will allow the organization to strengthen bonds with community based businesses in branch areas HootSuite: (Added on February 5, 2015) dashboard for social networking communities. Allows Marketing to make seamless connections with social networking communities; to coordinate account posting and monitoring; and schedule pre-planned posts. This tool is highly recommended for its ability to plan ahead and monitor social sites in one place. HootSuite has been used in conjunction with the Marketing calendar to schedule and monitor daily posts. Future Social Networking Plans: YouTube: Monthly posts using financial experts that are relatable and knowledgeable to

speak about specific areas of interests and share “how-to” information. LinkedIn: Monthly use to feed industry related content as articles; utilizing the expertise

of X COMPANY representatives. Pinterest: Weekly use to aid in financial literacy with use of images Google+: Weekly use as resource sharing tool with images, videos and infographics

Review Site Strategy: Review sites will be monitored weekly. Reviews that may negatively impact the organization will be responded to within 1 business day. Unfavorable reviews will receive direct responses, in an attempt to rectify the reviewer’s complaint. If applicable, an approved X COMPANY message will be kept as a response to the complaint, directly on the review site. In addition, a weekly Web search will be performed to locate any new review sites and/or mentions from sites not mentioned above.

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SUMMARY Historical circumstances and other world-based shifts have greatly impacted generational experiences and consequently shaped each generation from the Silent generation up to Millennials. The research is clear, Millennials have a very different understanding of the world than earlier generations and as an organization it is critical to move with these shifts to reach this ever expanding population. Technology is at the forefront of these shifts - and X COMPANY is making changes to align more effectively. The aforementioned plan to utilize social media as an extended marketing vehicle will increase X COMPANY’s engagement with Millennials, while staying current and relevant with trends in the industry. In addition, other key X COMPANY digital advancements will allow the credit union to “speak the language” of Millennials while providing them “connectedness” and “on-the-go” access to manage their finances. In turn, with the ease of service and availability of products, Millennial members will have a greater awareness, understanding and acceptance of X COMPANY as their primary financial institution. Millennials want robust mobile apps and powerful online tools, and desire to be engaged and entertained through social media. The key to attracting and retaining the next generation of members is to make it easy for these well-informed and educated young people to find the information, products and services they need.19 According to a industry white paper, “Millennials want the convenience and flexibility of managing their money online so that they never have to enter a branch. They want powerful online tools and electronic services, including mobile deposit, external account transfers, online account opening, check-image and pending-transaction viewing, and a suite of budgeting tools. They want a simple way to make payments to friends. They want the ability to set up and receive alerts about activity on their accounts. And they want to learn how to establish credit and have access to affordable credit as their earnings increase.” Most importantly, the industry white paper contends, Millennials want seamless interaction for all of those services across desktop, mobile, car and television platforms, and access to cutting-edge technology such as voice, image capture and geo-location capabilities. X COMPANY is already providing many of these technologies – and will continue to expand our social media reach to greater align with Millennials.

19 http://www.nwcua.org/posts/how-can-credit-unions-attract-the-next-generation-cuna-white-paper-s-answers-might-surprise-you#sthash.Ok4bB4E4.dpuf