Singapore and Hong Kong – March 2, 2009 – Financial Insights, an IDC company, today announces the release of a report that discusses how banks are pursuing the Generation Y (Gen Y) market in the Asia/Pacific region. The report points out that banks' Gen Y strategies will evolve in three phases. In the first phase, banks will modify current channel, product, as well as customer experience strategies. In the second phase, they will start to develop specific strategies that target segments and sub-segments within the Gen Y customer base. In the third phase, banks will focus on innovation in a bid to resonate with this group of customers, which will result in new products and channel formats being introduced into the market. More insights are revealed in this study, "The Rise of Generation Y: What This Means for The Asia/Pacific Banks" (Doc # FIN216526).

"The strategies of Asia/Pacific banks to attract the Gen Y demographics are currently disparate and tentative. Banks still have to clearly understand the habits, mindset and preferences of this group of customers," remarks Michael Araneta, Senior Research Manager at Financial Insights Asia/Pacific. "However, some characteristics of Gen Y banking customers such as their preference for interactivity, openness to credit, demand for choices, pride in communities, and their sense of entitlement, have become more apparent. The overarching trait of this group is the pervasiveness of technology in their lifestyles," Araneta continues.

Highlights of Financial Insights' analysis include:

• The rise of the Gen Y segment signifies that the banks' current multichannel strategies have to be recast. For most Asia/Pacific banks, greater focus will be placed on online banking and mobile banking. In fact, the prevalent use of mobile devices is already shattering the notion that a bank's channel is owned, managed and controlled by the bank itself. The emergence of the Gen Y segment, which is the first generation to have used mobile phones since they were young, will bring a bank channel well into the ownership and control of the customer.
• The current range of products targeted at Gen Y customers is limited. This boils down to the nascent demand for financial services by this group of customers. However, financial institutions across the region have seen several successes with Gen Y customers in broad product categories such as deposits, cards, and money and wealth management.
• Increasingly, go-to-market strategies of banks will focus on new media such as online videos, blogs, podcasts, gaming and social networks. For example, initiatives to integrate debit- and credit- card rewards to social networks have been successfully launched. Banks are also investigating the feasibility of "advocate strategies", and are looking to engage influential Gen Y individuals who are willing and able to recommend its organization to his or her network of friends.

Araneta concludes, "To gain a foothold in the Gen Y market, banks can quickly modify current channel formats, product portfolios, and customer experience strategies. This is a pragmatic approach to quickly access new markets and attract new customers, which is what is needed amid the crisis. After the crisis, banks should focus on being transformative and innovative. Ultimately, banks should realize that the battle for the Gen Y segment can be won, not by simply building on top of traditional strategies, but by using innovation to respond to preferences that make the Generation Y unique from older generations."

For more information on obtaining this report, "The Rise of Generation Y: What This Means for The Asia/Pacific Banks" (Doc # FIN216526), please contact sales@financial-insights.com. To set up an interview with Michael Araneta, please contact Lay-Fang Tan at lftan@idc.com.

Financial Insights, an IDC company, provides independent research, custom consulting, and detailed multiclient studies on the technology issues and challenges facing the financial services industry. Its global research covers topics of strategic importance to corporate and retail banks, insurance carriers, and asset management, securities, and brokerage firms. Local practices in Asia/Pacific, Europe, Latin America, and Canada add in-depth regional viewpoints. Financial Insights is headquartered in Framingham, Massachusetts, USA. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. For more information, visit www.financial-insights.com.

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