The affluent, educated, upwardly mobile segment of the population known as Generation X (ages 25-34) could yield a bonanza in new revenues for banks, according to Celent Communications.
The 2.1 million Gen-X professional households represent $21 billion in annual potential revenue for financial services firms savvy enough to attract and retain them, according to a Celent report, Gen-X Professionals, Financial Services, and the Web.
A survey of Gen-X professional households conducted by Celent yielded several key findings: 42 percent of respondents reported having a financial planning provider, while an additional 15 percent reported planning to find one within the next 12 months. Two-thirds of those are planning to look for their provider online.
"With the collapse of the 1990s bull market, the future is suddenly in question, even for these young affluents," according to Matthew Josefowicz, a senior analyst at Celent and author of the report. "This anxiety about the future and interest in financial planning represents a tremendous opportunity for financial services providers."
By targeting these customers now, financial services providers have a chance to insert themselves into the Gen-X professionals' long-term financial plans, giving providers a leg up on their competitors who will begin to target the same households as they approach middle age. To maximize the value of the Gen-X professionals, institutions must focus on compelling Web-based messaging to attract them and on creating competent Web services to keep them.
The overwhelming majority of those who reported planning to look for new providers within the next 12 months said that they planned to choose their new providers via the Web. Forty seven percent of respondents to Celent's survey cited the Web as their number one preferred way to communicate with their financial services providers, more than any other channel.
The report includes survey data from Celent's recent online survey of Gen-X professional households, and provides detailed information on financial product usage, plans, and online behaviors across the banking, investments, and insurance segments.