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The AGE CURVE

How to Profit

from the Coming

Demographic Storm

Kenneth W. Gronbach

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League of Southeastern Credit Unions

Strategies for the New Millennium

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Who is YourMember?

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Who is Your Competition?

Who are Your Vendors?

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Who are Your Investors?

Who are Your Employees?

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What is your Community?

Birth Chart Build

2.0

2.5

3.0

3.5

4.0

4.5

1905 1925 1945 1965 1985 2005

Num

ber

of B

irth

s (i

n M

illio

ns)

US Live Births 1905 - 2005

1905 1925

GI Generation56.6 Million

GI Generation56.6 Million

1925 1945

Silent Generation52.5 Million

1945 1965

Baby Boomers78.2 Million

Silent Generation52.5 Million

1965 1985

Generation X69.5 Million

Baby Boomers78.2 Million

Generation X69.5 Million

1985 2005

Generation Y100 Million

(through 2010)

Generation Y100 Million

(through 2010)

Latino Immigration40 Million+

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What are your opportunities?

• Loans for retirees

• Immigrant loans

• Small business loans

• Minority loans

• Women owned business

• Generation Y loans

•New market loans

What are your challenges?

• Cash Flow• Regulatory issues• Human resources• New markets• New marketing• Banks Hate you!

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Your rightful share of the Boomer Retiree Market!

Baby Boomers will never change

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They just change everything else!

• Baby Boomers will redefine retirement.

• Baby boomers will eventually flood into Florida and the South in general.

• Baby Boomers are currently 49 to 68 years old, peaked at about 56.

• Once the current housing market corrects...watch-out!

• How will changing Boomer consumption effect the Credit Union business?

Make your product easy to buy!

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Four Boomer Rules!

•Have what I want.

•Make my life easy.

•Save me some time.

•Don’t rip me off!

Is credit union success tied to the current U.S. housing crisis?

Is the Pope

Catholic?

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Housing’s perfect storm?

McMansions, what were we thinking?

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Housing’s Perfect Storm!• The foreclosure/housing issue is correcting, freeing

up five years of pent up demand.

• Baby Boomers will sell their houses, retire and move south.

• African Americans and Latinos will build and buy houses.

• Asian and European immigrants will build and buy houses.

• The huge Generation Y will rent, buy and build.

• Women will buy and build houses.

• The economy will restore and unemployment will decline.

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The biggest worker retirement in the history of the United States is

about to happen!

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Wal-Mart’s retail model is called

Cheap and Deep.The model only works with mature markets.

Too Big To Fail is a Myth!

Small business will return to the United

States with a vengeance!

How can credit unions capitalize on this?

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New Generation Y Marketing

Generation Y is Why.• Generation Y was born 1985 to 2004 and is bigger than the

Baby Boomers (about 83 million).• They are very green, humanitarian and do not see race or

color.• They significantly influence trillions in consumer spending.• They are flooding the labor market and will face 50%

unemployment.• They will open a sea of small businesses because they need to

eat.• They will speak cyber as a first language.• They tell time differently!• Credit unions have an economic mandate tounderstand them and get in front of their demand.

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Gen Y weddings will set records!

Car or Internet?

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Generation Y Consumption

• They will start to marry, set up households, have children and need financial services.

• They will buy clothing, cosmetics and hygienic products as they seek to attract mates.

• They will inhale electronics and entertainment.

• They will buy and build houses, rent apartments and buy cars.

• They will change the way food is bought and consumed.

Generation Y will redefine marketing.

• The dawning of the Age of the Customer.

• The end of the Age of the Seller.

• The end of hype.

• The beginning of total transparency.

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The New Decision Makers

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Marketing to Gen Y is tough!

• Gen Y will advance through the ranks quickly because of Generation X.

• They are extremely analytical/cyber and will investigate and quantify everything.

• No more good ole boy.

• A pair of tickets will not get the order.

• Conventional media is history.

• How will you reach them with credit union products and services?

Generation Y workplace requirements.

• Transparency

• Integrity

• Sense of Green

• Humanitarian

• Fairness

• Cyber

• Empathy

• They won’t work for mean people!

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The Baby-Blenders 2025 to 2044

No more red-heads

The Boomers are Coming

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What is your Disneyland?

Just Burgers?

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What is your Egg McMuffin?

Lead Sled

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Powerful lightweight two door cars

What is your Mustang?

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Look for women to lead

The glass ceiling is shattered.

Women out number men in college at a 60/40 ratio.

They will run things.They will control their own

finances!

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Women in the Workplace

On average women make about 75% of what men make for the same job.

Latinos

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The Latino Influence• Latinos are spiritual Catholics.

• Latinos are very family oriented and take responsibility for their elderly.

• Latinos are aspiring and assimilate into U.S. culture in twenty years.

• The United States economy will benefit dramatically from the contribution of the Latino culture as they advance socio-economically.

• Is this a new market for credit unions? Yes!

Asian Americans

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Asians make up only about 5% of our total population

but that will change as Asians begin to flood this continent especially from

China. They will need financial services.

The American family

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The African American Influence

• The symbolic impact of the Obama family in the White House has had a profound positive influence on African American culture.

• As African Americans advance socio-economically so will their need for financial services!

Middle Eastern fertility is well above Western averages.

• Middle Eastern Immigrant’s fertility in the European Union is well above native fertility.

• Over time the Muslim culture will dominate the European Union.

• Western European culture

and Muslim culture are

not homogeneous.

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The core strength of the United States is

faith and family.Dr. Nicholas Eberstadt

Henry Wendt Scholar in Political Economy

American Enterprise Institute

What are we going to talk about?

• Your Product: Credit Unions• Your product’s unique selling

proposition (USP) and brand.• Your new market, Generation Y

and more! • Media

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You are a credit union, not a bank!

Banks are ToxicBanks are not your

friend

Banks are Greedy

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Perception isReality!

Distance yourselves from banking with a vengeance.

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What is your Unique Selling Proposition?

People helping friends with money matters in a complex world.

The personal aspect of credit unions is your biggest asset.

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Banks do not have friends, banks have

interests.Credit unions have

friends.

Marketing to Generation Y

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Madison Ave

Generation Y is Why.• They will probably not come into your building.• They will conduct their financial matters on their

handheld devices.• Many will live at home well into their twenties.• They will inhale the latest electronics.• Relationships are important to them.• They like to work in groups.• They will probably marry earlier.• They will open small businesses.• They will build 1500 square foot self sustaining

houses

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You will need Generation Y employees

if you are going to market to them.

Piercings and Tattoos will make the workplace a little more interesting.

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So, how do we reach Generation Y?

Media and Generation Y

• Is facebook the clear leader?

• What about radio?

• Does generation Y read newspapers, magazines?

• What about billboards?

• Will television work?

• Snail direct mail?

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Facebook“If you are not paying for it, you’re not the customer; you’re the product being sold.”

Andrew Lewis

Social media should be a part of your media mix.

It shouldn’t be your media mix.

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Radio, newspapers and most magazines are history in Y’s eyes.

111 million viewers watched the 2012 Super Bowl

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How good are you in eight words or less?

Anything for Me?

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All media should drive to web!

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Remember…..Early to bedEarly to rise

Advertise! Advertise! Advertise!

Cities will become dangerous places, again, as crime increases.

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Cyber/Robo Cops

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Things to Remember• Housing and the economy will recover within the next

three years. Unemployment will decline.

• Millions of Boomers will retire and move to warm climates.

• The biggest generation in the history of the U.S., Gen Y, will start to marry, enter the workforce and consume.

• Manufacturing will return to the U.S.!

• Wealthy immigrants will flood into the U.S. and the Americas.

• One third of our population, Latinos and African Americans, will advance socio-economically as never before.

Credit unions will take market share!

The best days for the United States and credit unions are ahead of us, not behind us!

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What’s Next?

US Triumph: Flight 1152

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We need to have vision

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The AGE CURVE

How to Profit

from the Coming

Demographic Storm

Kenneth W. Gronbach