Superior Security Drives Bank Loyalty, But Gen Y Is Up For Grabs

Jun 5, 2012

Superior Security Drives Bank Loyalty, But Gen Y Is Up For Grabs


Javelin’s 2012 Annual Security Report Shows Banks How To “Move the Needle” on Security Usage and Boost Gen Y Retention

San Francisco, CA, June 4, 2012Javelin Strategy & Research’s latest report - “2012 Antivirus Software and Browser Security Report” - shows that offering superior security drives bank loyalty, as one-third of household financial managers indicate that security is one of the top three factors they take into consideration when choosing a new financial institution (FI). However, Gen Y (born between 1979 and 1999), the most “plugged in” generation, demonstrates a false sense of security. Almost one in ten Gen Y consumers do not use antivirus software because they use a Mac. Yet last month, more than 600,000 Macs - perceived as the most impenetrable computer - were infected with “Flashback” malware.

Javelin provides key recommendations to FIs on how to connect with Gen Y consumers, a lucrative and attractive banking target market, and turning these security risk-takers into loyal and profitable customers. This report also explores how security software suppliers and potential distributors (including financial institutions, billers and issuers) have the opportunity to enter into a mutually beneficial relationship and distribution channel.

Gen Y is a key target market for FIs. Their incomes are rapidly rising and will surpass all other demographic groups by 2025, accounting for almost half of all personal income. As FIs try to shift consumers toward more cost-effective electronic channels, tech-savvy Gen Y is the demographic most primed to bank online and through mobile channels. Gen Y is aware of security solutions; yet, just 56% of Gen Y consumers are actively protecting themselves against malware compared to 68% of Baby Boomers. Price sensitivity is a major factor in the use of security software among Gen Y consumers; however the decision to forego electronic security is more than a cost issue. Comfort with electronic channels has fostered a less cautious approach to online activities. Yet this online cohort is precisely the group that would benefit most from antivirus and antimalware solutions.

“If FIs really want to move the needle on security with Gen Y, they need to educate consumers the right way, because simply promoting antivirus and antimalware software isn’t effective,” said Vic Wheatman, Senior Director, Security, Risk, and Fraud at Javelin. “We outline the steps FIs need to take to raise awareness of Gen Y’s vulnerability and engage consumers at the outset, so consumers will actually apply the security measures they need to bank safely online at their FI.”

“FIs can work with security software suppliers to build consumer trust in online channels,” said Jim Van Dyke, President, Javelin. “FIs will want to onboard Gen Y as early as possible to increase switching costs, maintain consumers’ satisfaction, transition consumers away from more costly physical channels, and develop long-lasting and profitable relationships.”

Javelin’s 2012 Antivirus Software and Browser Security report explores how FIs can leverage security solutions to educate the lucrative Gen Y market and other consumer segments to increase customer loyalty and retention. This also explores how security software suppliers and potential distributors (including financial institutions, billers and issuers) have the opportunity to enter into a mutually beneficial relationship and distribution channel.

For additional details, click here: “2012 Antivirus and Browser Security Report: How to Profit by Engaging the Gen Y Consumer Today.

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About Javelin Strategy & Research Javelin Strategy & Research provides strategic insights into customer transactions, increasing sustainable profits for financial institutions, government, payments companies, merchants and other technology providers. Javelin’s independent insights result from a uniquely rigorous three-dimensional research process that assesses customers, providers, and the transactions ecosystem.

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