But Millennials like small businesses and the customer service that comes from someone knowing your name. Capital One’s latest venture – the Capital One Café – is an effort to bridge this disconnect, and market a relationship-based banking experience to millennials in a manner that speaks to them and their needs.

A local presence does not necessarily need to be a cafe, although informal meeting places with good wifi is important.  Finding a place to call home in brick-and-mortar locations is a natural step. Remember that building local presence goes way beyond merely renting office space. In some of these new markets, there’s a sense of Main Street authenticity. Mortgage companies need to become part of that local presence. Be sure to support the community when possible. You can do this either financially or by participating in local organizations like the Chamber of Commerce and PTA.

Banks looking to capitalize on this shift need to focus on trust. Millennial home buyers want straight-shooting honesty and authenticity. That’s been proven time and again when industry professionals come to market with clear, concise, no-gimmick messaging.

This is part of the millennial generation’s deep distrust of big banking institutions, which comes in response to the 2008 financial crisis as well as scandals like the ones Wells Fargo has fought through in recent years.

Marketing Solutions

When local and regional lenders invest in these new millennial markets, they should do so with an omni-channel approach. Treating digital as the end all, be all to success with this demographic is a huge mistake. Digital is just one of many marketing channels. Lenders need to experiment with direct mail, which has been proving highly effective with the millennial cohort. Statistics show that 84% of millennials go through their mail each day. Also, now that there are fewer pieces in the mailbox, response rates have increased up to 5.3% versus a high of 0.9% for digital.

When it comes to trust, direct mail is considered to be the most trustworthy marketing channel. Email marketing is a negative. 63% of Millennials are using digital ad blockers. The USPS informed delivery digital version of direct mail is the only email delivery system that resonates with this group.

With Millennials, the message counts. But it must be done in a natural way. Millennials don’t want some faceless voice advertising to them by the big banks. Choose a clear, simple message that’s easily understood and skips the fine print.

Another thing – banks and mortgage lenders who espouse social responsibility are the ones millennials will choose to work with.


New Research (published 4/30/20):

Millennial home buyers have become more likely to use savings to fund down payments. Some are getting loans / help from parents or relatives. Down payments nowadays are lower than ever before.