What's Been Learned About How To Market To Teens-And Why

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Clothing retailers, snack-food makers, soft drink companies-name virtually any producer of consumer goods or services and you're virtually guaranteed that teenagers are fixed in their marketing crosshairs. And for good reason; in terms of both dollars and spending discretion, today's teens have unprecedented spending power.

Consider the following. Despite the sour U.S. economy, teens still managed to spend $170 billion in 2002 according to a study by leading teen-focused market-research firm Teenage Research Unlimited (TRU). That's a jump of about $15 billion compared to 2000 data compiled by TRU.

By any measure, teens are now power consumers and increasingly important marketing targets for credit unions. Awareness of and opinions about financial services, which ultimately guide long-term decisions on financial services, form during the teenage years. As credit unions look to cultivate the next generation of members, marketing effectively to teens becomes critical.

As a company that helps credit unions improve their marketing approach, it's important for us to understand how teen awareness and opinions of financial services are fed and developed. Recently, Liberty Marketing Services tapped TRU to conduct research on which information sources and mediums teenagers turn to most frequently for information on financial service offerings, options and issues. The study surveyed more than 2000 teenagers during January and February 2003. Interestingly, we discovered that traditional financial services marketing efforts may be missing the mark with teens. Some of the key findings:

* 89% of teenagers surveyed rely most heavily on their parents for information on financial services. While this shows that marketing efforts targeted at parents stand a reasonably good chance of passing through to children, parental preference and bias may influence the sophistication and accuracy of information supplied to teenagers.

* On average, teens do not credit media commonly associated with financial services marketing-such as television, the Internet and marketing brochures from financial institutions-as go-to sources for useful information.

* Nearly 60% of respondents cited their school as a primary source of information on financial services. The three service areas receiving most of the attention in schools are financial aid for college, stocks and related investment tools, and taxes. However, with more than 40% of students not citing school as significant source of information on financial services, credit unions can view this as an opportunity to work more closely with secondary education.

* Age 18 to 19 represents a critical crossroad where teenagers migrate from learning about financial services exclusively from their parents and school, to seeking additional information from outside resources.

Tips for Targeting Teens

When it comes to teen marketing, credit unions and other financial services providers have unique challenges that more novel product and services companies, such as video game makers and soft drink manufacturers, do not. So how can credit unions effectively target this increasingly important demographic and convert them from casual consumers of financial services information to tomorrow's members?

First off, it's vital to get to them early, directly and creatively on the marketing front. Here are a few ways credit unions can modify their marketing approach to make them more effective for teens:

* Stay in touch with trends and speak their language. The biggest factor in appealing to this group is being relevant. To do this, you must constantly update and modify your marketing messages.

* Plug into the local "teen scene." Get involved with teen causes to demonstrate that you want to be a part of their social concerns. This would include issues such as drinking and driving, drug abuse, peer pressure, etc.

* Tune into their interests. Focus your marketing content on what they really what to learn about and work in products and services that address these interests. This would include aligning marketing programs around interest such as music, computers, fashion, learning another language, etc.

* Practical incentives are most compelling. If you are going to offer marketing incentives for account openings, consider items that really center around what most teens do in their leisure time (listen to music, talk on the phone, shop at the mall). Avoid incentives like concert tickets, amusement park tickets or other incentives of which teens might not be able to take immediate advantage and have a limited "shelf life."

Most, if not all, consumer products companies follow these general guidelines. By following these tips, credit unions can help ensure that their marketing approach for teens will resonate and create the reinforcement necessary to convert today's teens into tomorrow's credit union members and evangelists.

Tony Rizzo is director of Sales and Marketing with Liberty Marketing Services, Mounds View, Minn. Mr. Rizzo can be reached at (800) 607-2435.

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