According to a 2018 report titled “Trend-Setting Millennials” by Deloitte and Retailers Association of India, millennials (the new age of consumers, loosely defined as those born between 1980 and 1995) in India constitute 34% of the country’s total population. It also says that they are the chief wage earners, accounting for around 71% of total household income. It is clear that the target audience is large and has significant spending power. The question is, where are the millennials spending all this money?
With time, the spending patterns and life goals of millennials have witnessed a paradigm shift and today traditional financial goals such as buying a home or a car, or saving for a wedding, etc., rarely feature in their list of priorities. Most are inclined towards meeting short term needs and prefer to invest in items and experiences that provide instant gratification.
No wonder then, that if you are a financial advisor trying to sell mutual funds to this target audience, you will need to adopt a different approach. Read on, to know what:
- They Are A Mobile-First Generation
Digitization has had an enormous impact on the way millennials spend and lead their lives. They are the ‘digital natives’. Be it shopping, going to the movies, or dining out with friends or even finding a love-interest, they like doing everything on a mobile device.
Having instant access to things radically shapes their buying behavior. They will not care for a swanky brick and mortar office you have. What they really need is an app that is fast, secure, and reliable, and that allows them to read, review, analyze, and transact when they wish to.
- Lead by Action
Instead of preaching your clients, your focus should be on leading by action. The flip-side of the digital way of doing things is that millennials are swamped with information. You can help them separate the news from the noise. Be their friend, helper, and confidant, earn their confidence.
Substantiating suggestions with real-life examples and anecdotes will help millennials understand the space and choose their funds.
- Be Available
Millennials value speed and convenience. For example, app-based aggregator cabs. Since these are available at any time and with a tap of a button, the millennial generation is growing extremely fond of their services. So much that they plan to ‘never buy a car’.
Such ease and instant fulfillment have pushed up their expectations. They expect the same level of service from their financial advisors and distributors. Stay connected with them through platforms like social media, apps, and mobile (read WhatsApp, not SMS, and certainly not cold calls).
- Be an Advisor and A Salesman
The days when you made decisions on behalf of your client(s) are fast fading. Today, millennials prefer to get involved in the decision-making process and on most occasions like to take matters into their own hands. Thus, as an advisor, your focus should be on offering them the knowledge, and to aid them in their decision-making process.
Changing times warrants a change in approach. Focus on building a comprehensive portfolio – start with goal-based financial planning. Tell them about the ground rules and the fine art of investing and wealth creation but remember not to sell.
IDFC Mutual Fund offers various equity, hybrid, fixed-income, and debt funds to match the investment needs of all types of clients. Follow us for regular insights and inputs.