Every Friday, we share items we’ve read that seem to have missed attention but inform and impact community financial institutions. This week, survey results on the level of aversion younger consumers have to the phone call.
1. No to calls
In an era where instant messaging reigns supreme, a surprising trend is emerging: young consumers actively avoid phone calls. This shift isn’t just changing social norms—it’s reshaping how businesses, especially financial institutions, need to approach customer communication. Recent survey results reveal a startling aversion to voice calls among younger demographics, presenting challenges and opportunities for community banks and credit unions. Let’s dive into why the phone call is falling out of favor and what it means for your institution’s customer engagement strategy.
The Numbers: Just How Much Do Young People Hate Phone Calls?
The UK consumer utility price comparison service Uswitch released survey results on younger consumers’ general distaste of phone conversations, with a few explicit carve-outs.
A quarter (23%) of 18 to 34-year-olds say they NEVER pick-up calls, with over half (56%) assuming an ‘out of the blue’ call means bad news
Social media (48%) and voice messages (37%) are preferred by young people - yet half (53%) would be offended if their friend or family didn’t phone them to announce happy news such as an engagement or a new baby
Avoiding scam calls is the most common reason for not answering the phone. But news is worth sharing as six in ten (64%) women consider a ‘general chat’ worth a phone call in comparison to 53% of men
Overall, we now spend an average of just five and a half minutes on the phone every day
Beyond Preference: The Psychology Behind Call Avoidance
Yasmin Rufo of the BBC provides further context on why the generational shifts from the habitual phone use of the “Mean Girls” Gen X era to social media DM, group texts, and VM’s on Millenial and Gen Z.
Psychotherapist Eloise Skinner explains that anxiety around calls comes from “an association with something bad - a sense of foreboding or dread”.
“As our lives get busier and working schedules more unpredictable, we have less time to call a friend simply to catch up. Phone calls, then, become reserved for the important news in our lives, which can often be complicated and difficult.”
This spills over into work and consumption habits and often how younger consumers are put off by phone usage in their life.
Henry Nelson-Case is a 31-year-old lawyer and content creator whose series of “overwhelmed millennial” videos are painfully relatable - sketches include the angst of sending a company-wide email, politely refusing to work overtime and of course, one about an employee doing anything to avoid a phone call.
He says “it’s the anxiety associated with real-time conversations, potential awkwardness, not having the answers and the pressure to respond immediately,” that makes him hate talking on the phone.
“Phone calls are more exposing and require a higher level of intimacy whereas messaging is detached and allows you to connect without feeling vulnerable or exposed,” explains psychologist Dr Touroni.
What This Means for Financial Institutions
The aversion to phone calls among younger consumers has significant implications for community banks and credit unions:
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Customer Service Channels: Traditional call centers may become less effective for younger demographics. Consider investing in robust digital communication channels like chat, messaging apps, or like this example from Michigan Legacy Credit Union - video tellers.
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Product Design: Financial products and services may need to be redesigned with minimal need for voice interaction. Think automated processes, self-service portals, and AI-driven chatbots.
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Marketing and Outreach: Cold calling strategies will likely be ineffective with younger consumers. Focus on digital marketing, social media engagement, and permission-based communication. Sprout Social presents a few examples of even older brands like Dollar Tree and The Home Depot reinventing their outreach.
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Employee Training: Staff may need new skills to excel in written digital communication, which requires different competencies than phone interactions.
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Technology Infrastructure: Institutions may need to invest in new technologies to support omnichannel communication preferences.
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Data Analytics: With more interactions via text-based channels, there’s an opportunity to gather and analyze communication data more effectively.
By understanding and adapting to these changing preferences, community financial institutions can position themselves to better serve and retain younger customers in an increasingly digital world.
As younger consumers increasingly opt for text-based communication, community financial institutions face a critical juncture. The challenge lies not in simply abandoning phone services but in strategically diversifying communication channels to meet varying customer preferences.
Embracing New Channels Without Hanging Up on Quality Service
By leveraging data analytics, investing in digital infrastructure, and training staff in new communication skills, banks and credit unions can turn this generational shift into a competitive advantage. The key is maintaining the personalized, high-quality service that community institutions are known for while adapting to new delivery modes.
Remember, the goal isn’t to replicate the phone call experience in text form but to reimagine customer interactions for a digital-first generation. Those who successfully navigate this transition will not only retain younger customers but also establish themselves as forward-thinking leaders in the financial services industry.
The phone may be falling out of favor, but conversations with your customers are far from over—they’re just moving to new platforms. Are you ready to meet them there?
As a community financial institution, you must play to your strengths to even survive, let alone pull ahead during turmoil. Customer intimacy, your close proximity to your market, is a very tangible moat to the community FI business model. But you must use it to your advantage. To quote HBR’s seminal Roaring Out of Recession:
“Progressive companies stay closely connected to customer needs—a powerful filter through which to make investment decisions.”
-RE
That closes the week. Remember kids, some people wake up every day and choose violence.
Shut up before I open a Nature Valley bar on your bed
— Jackie B (@jackienotjaclyn) August 12, 2024
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