7th October 2024
Young customers really do care more about banks' values
Our polling suggests young customers are more likely to pick their current account provider on the basis of its perceived ethical conduct or environmental friendliness
On 30 September 2024, Nationwide launched the latest iteration of its advertising campaign featuring Dominic West as the arrogant boss of ‘A.N.Y. Bank’.
In the advert, West’s daughter tells him that she banks with Nationwide because ‘it just feels good to bank somewhere that’s owned by its members rather than someone like you.’
In 2022, the Co-operative Bank created an advert that also played up the provider’s values (though this was less obviously targeted at young people):
Do you know where your bank invests your money? It could be logging in the Amazon or coal-fired power stations. It’s time to withdraw from this and join a bank that hasn’t financed fossil fuel production for over 20 years.
What does polling show?
How much do customers, especially young customers, care about the ownership structure or environmental policies of banks or building societies?
In September 2024, Fairer Finance polled just under 10,000 current account customers to ask them why they picked their provider (respondents could pick multiple options).
The most commonly given reasons were ‘the provider’s reputation’ (38%) and ‘recommendations from my friends and family’ (36%). Among 18-30 year olds by far the leading reason was recommendations from friends/family (58%) - a result that makes sense given that young people have less direct experience of different banking providers and so rely more on recommendations from people they trust.
However, our data also suggest that young people do claim to care more about a bank’s perceived values than older customers.
As the chart below shows, 18-30 year olds were three times as likely as over-65s to say they chose their provider because they perceived it as environmentally friendly. 18-30s are twice as likely as over-65s to mention a provider’s ‘ethical conduct’ as the reason they chose their bank. Young people may also view being ‘green’ or ‘ethical’ as a more important part of a provider’s overall reputation than older customers.
These results don’t necessarily mean that older people don’t care about a bank’s values or how ‘green’ it is. They may well care about these things but see them as relatively less salient than younger customers. Alternatively, young people may not care about these factors as much as they claim, but feel greater social pressure to say that they do than older customers.
Nonetheless, these results imply that Nationwide’s strategy may well be effective at attracting younger customers. Young people really do place a greater emphasis on a banking provider’s values than older people. As long as their actions are aligned with words, we could see their new campaign - which emphasises their values - win over a larger share of young customers.