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Effective communication is key for growing your 401(k) business. And if you can believe it, not everyone has the same communication preferences. Each generation likes to receive and consume information differently. As you think about your business and who your ideal clients are, it's essential to consider which of the four main generations they belong to: baby boomers, Gen X, millennials and Gen Z.
Baby Boomers
Today, baby boomers have significant control over 401(k) decisions and represent around 25% of the labor market. However, with 10,000 baby boomers turning 65 every day, the retirement age wave is upon us.
If your clients and prospects are baby boomers, they tend to prefer a more traditional way of receiving information, such as phone calls, newsletters or in-person meetings. They also value personal interactions and face-to-face conversations. Baby boomers tend to be loyal to an advisor and appreciate consistency in communication.
Gen X
Gen Xers, born between 1965 and 1980, are usually in senior leadership positions, such as CFO or controller. They are comfortable with technology and prefer to use email and phone calls to communicate. Gen Xers are skeptical of salesy tactics and value personalized messages where they are seen as individuals. To nurture this group, it's essential to send educational emails that demonstrate your retirement plan expertise and value-add content such as checklists, plan sponsor guides, and calendars.
Millennials
By 2030, millennials are expected to represent 45% of the labor force. This generation has grown up and evolved from being dragged as avocado toast slouches to the leaders of HR, technology and finance departments.
Millennials are tech-savvy and are avid users of social media platforms. Within client communications, engaging with millennials is important, as they prefer to communicate via text messages, social media, and email rather than phone calls or in-person meetings. Millennials appreciate authenticity and transparency in communication, so it's best to take a more conversational approach.
Gen Z
Gen Z is the true digital native generation, born between 1997 and 2012, and is more comfortable with new technology than any other generation. Gen Zers tend to use newer social media platforms like Instagram, Snapchat and TikTok, rather than Facebook or LinkedIn. They prefer visual content such as videos, memes, infographics and tend to have short attention spans.
While these new job seekers may not be decision-makers, they are the newest 401(k) participants. It's crucial to have employee education and financial wellness strategies in place to help them save and prepare for retirement.
Communication with Your Clients
When communicating with clients, it's essential to consider their communication preferences. For example, if you're advising a baby boomer plan sponsor, an in-person meeting would be effective. During the meeting, you can explain retirement plan updates and answer any questions they may have.
On the other hand, millennials or Gen Z might prefer to use video conferencing or email to discuss the 401(k) plan and its findings. Using visual content such as plan sponsor guides, checklists, reports and graphics can make the information more digestible.
Content Strategy
Effective content strategy depends on understanding the target audience's preferences. If you're targeting baby boomers, focus on print media such as physical newsletters, brochures and other traditional marketing materials. Gen Xers prefer email campaigns with personalized messages and informative content.
For millennials, creating conversational content that is informative and engaging through social media platforms such as LinkedIn can be instrumental in reaching this audience. Finally, for Gen Z, visuals such as memes, short-form videos and graphics that are easily shareable and incorporate humor and relatable content are more effective.
Investing in Different Business Development Strategies
Today's workforce comes from different generations and communicates differently. As a retirement plan advisor, understanding the communication preferences and content consumption habits of each generation is essential.
With this knowledge, tailor your communication strategy to resonate with your preferred cohorts. Investing in different business development strategies can enhance relationships, increase client engagement and ensure your 401(k) business continues to grow to its fullest potential.