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Attracting generation Y to retail banking: Bank responses to global challenges
University West, Department of Economics and IT, Division of Business Administration.
University West, Department of Economics and IT, Division of Business Administration.
2015 (English)Independent thesis Advanced level (degree of Master (One Year)), 10 credits / 15 HE creditsStudent thesis
Abstract [en]

'Attracting generation Y to retail banking' is a study written by Maria Maestre Garcia and Katharina Steinhauer during their degree project in spring semester 2015. This project marks the end of their 'International Business' studies at University West, Sweden. The aim was to investigate the choice criteria of generation Y (18-35 years) while selecting a bank. Furthermore, the extent to which this customer segment might be regarded as an international one was tested. These aims were justified as the authors had recognized a lack of knowledge within the scientific community. Previous studies, were outdated, addressed only certain members of generation Y or had a narrow focus on online banking only. Moreover, no studies were found relating generation Y as international customer segment in banking. This lack of research arises as a threat for retail banks, which have to attract this emerging customer segment to sustain their business by fulfilling their banking needs. Therefore, the authors tried to overcome this knowledge gap by conducting a survey (questionnaire) with the purpose to increase expertise within the scientific community, which can be translated into recommendations for Swedish retail banks conducting international business. For Swedish young adults mobile banking (apps) is the foremost popular way to interact with their bank. Furthermore, Swedish gen Yers appreciate positive image, good customer interaction along with high service. More precisely the following variables are the most essential: friendly and well-trained staff, good financial advice, confidentiality, financial stability, lack of scandals, and bank reputation. Besides, those customers like to communicate with their bank via telephone, e-mail and face to face. The most preferred way for obtaining information is the Internet. Generally, involvement of generation Y towards private banking services is overall low. In comparison between the Swedish and international adult sample both, similarities and differences were noticed. Similarities exist with regards to the majority of variables tested. Six differences were identified. Internationals use the Internet more frequently than apps. Also Swedish gen Yers appreciate more getting a private appointment, short size of waiting lines, reception at the bank, and family tradition. For internationals the appearance of bank employees and other customers is relatively more valuable. Further, the analysis reveals contradictory behaviour of this customer segment. Individually members of generation Y show low involvement with the banking sector. On a more general level, this customer segment wants to identify with a positive company as image variables such as confidentiality, financial stability, lack of scandals and bank reputation are regarded as important. Also conflicting behaviour was identified with regards to customer-bank-interaction. On one hand these so-called digital natives use mobile banking (apps) and the Internet as tools for their standard banking transactions. On the other hand, they still rely on personal action for special occasions as friendly and well-trained staff along with good financial advice ranked high. Despite being keen in technology, young adults lack in financial knowledge. With regards to extent of being one international market segment the authors assume, that certain differences as preferred ways of interaction will vanish over the years. Other differences will exist further and have to be taken into consideration, when banks eager to market their services internationally.

Place, publisher, year, edition, pages
2015. , 75 p.
Keyword [en]
Generation Y, millennials, retail banking, market segmentation, bank marketing
National Category
Business Administration
Identifiers
URN: urn:nbn:se:hv:diva-7814Local ID: EXD951OAI: oai:DiVA.org:hv-7814DiVA: diva2:843320
Subject / course
Business administration
Educational program
International Business
Supervisors
Examiners
Available from: 2015-08-17 Created: 2015-07-28 Last updated: 2015-09-15Bibliographically approved

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