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"We tried to figure out how we could build a dialogue between Millennials and someone who would hold their trust and represent the value of protecting their income."

—Laura Marzi
Assistant Vice President, Marketing, Group Benefits
The Hartford

 

 

 

 

 

 

 

 

 

 

 

 

 

 

"The person who handles the enrollment session could very easily be a mentor for these young workers."

—Lindsey Pollak
Spokesperson for The Hartford's My Tomorrow campaign

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits Products & Services

Generation transition

The Hartford focuses on the future with outreach to Millennials

 

By Thomas A. McCoy, CLU


"I don't know why you say goodbye; I say hello."

"Hello, Goodbye"

—John Lennon and Paul McCartney

Baby Boomers, the long-time rock stars of marketers' hearts, are gradually retiring. Employee benefits providers will continue to cater to Boomers' significant interest in retirement products, but long-term—let's face it—it is future generations that will supply the growth for employee benefits products. The departing Boomers will slowly give way to a generation of new benefits buyers.

About a year and a half ago, The Hartford embarked upon a broad-based effort to understand the special needs and perspectives of Millennials, (currently ages 18-31), also known as Gen Y. There are approximately 80 million Millennials and, according to the U.S. Bureau of Labor, by the year 2020 Millennials will represent almost 50% of the U.S. workforce.

The Hartford, which offers both employer paid and voluntary products, began by conducting an online survey of Millennials' attitudes towards benefits products, noting how they differed from those of Baby Boomers (ages 57-65). The independently conducted research came up with some revealing differences in the two groups, and some potential opportunities for marketing to Millennials, particularly for disability insurance.

In The Hartford's 2012 Benefits For Tomorrow Study, 48% of Millennials rated voluntary benefits as "extremely important," compared to only 30% of Boomers. The annual consumer survey also showed significant differences in how the two groups make their product choices:

• 27% of Millennials would turn to their parents versus 2% of Boomers.

• 16% of Millennials would seek help from a close friend versus 3% of Boomers.

• 12% of Millennials would ask their manager, compared to 2% of Boomers.

Among the findings which point toward significant opportunities for disability sales to Millennials: 56% of Millennials overestimated the cost of disability insurance by hundreds of dollars.

Last October, as The Hartford digested its data on Millennials' attitudes and preferences, it introduced "My Tomorrow," an employee benefits outreach campaign to this age group. It appointed Lindsey Pollak, a nationally known author and speaker on "next generation workplace trends," spokesperson for My Tomorrow. Pollak gives The Hartford a credible link to Millennials, as she consults with the company about how its benefits products can better serve Millennial needs.

Pollak provides career-building and money management observations for Gen Ys at The Hartford's My Tomorrow Web site (www.thehartford.com/mytomorrow), and via Twitter feeds for The Hartford, just as she does in her own widely followed blogs and Twitter feeds. The site gives the company an important link to Millennials—heavy social media users—who will be driven to it by their Web searches.

The tendencies and traits of Millennials will no doubt change over the next several decades, just as they have for Baby Boomers. But at this point in their careers, what should brokers and benefits consultants expect from this demographic group? To begin with, Lindsey Pollak points out, Millennials come into the workforce bearing a lot of financial stress.

"They are saddled with a tremendous amount of student debt," she says. "Many of them graduated into the global recession, so they worry about how they'll get their career started, and how they'll protect their future once they start those careers. They are concerned that because their immediate needs are so daunting, they won't take care of their long-term future needs—protecting their health, including their mental health, and investing in their future."

A difference between Baby Boomers and Millennials, says Pollak, is how the respective generations communicate about their financial challenges. Millennials will talk more openly about how difficult it is to find the right job or pay off their student loans, she observes. "That's partly because they feel the economy has presented them with a set of circumstances that they can't control."

Then, there's another reason why "the stigma of not being able to afford something is less for Millennials," says Pollak. "This generation prioritizes life experience over money. To them, having a good life or being successful is about having a lot of friends, having a cool social media presence or having your own unique personal style—playing your music or whatever it is that expresses who you are—rather than the house in the suburbs with the picket fence and the car."

Pollak continues, "You hear it said that for the first time in American history, this generation may not be better off than their parents' generation. I ask Millennials about that and they say, 'How are you defining better off? I think I'll be happier; I think I'll like my job more. I think I'll live where I want to live. I may not have as nice a house or car as my parents have, but I think my life will be better in the way I define it.'"

There is another important dimension to the financial outlook of today's Millennials that Pollak points out—one that is particularly relevant to employee benefits providers. "The Hartford's 2013 Benefits For Tomorrow Study found that two-thirds of full-time workers today have someone else relying on their paycheck.

"So, I point out to Millennials that their financial choices are not just affecting them individually. I tell them, 'If you have children, or if you are helping your parents because you're living in their house (10% of Millennials said their parents rely on their paycheck), then you have to think beyond yourself.'"

Customize this

For a long time, marketers in other industries have been cashing in on a trait that Millennials have carried with then since they were children: their love affair with customization. Toy stores created "Build-a-Bear" workshops to let Millennials design their own teddy bears. Starbucks gave them not just coffee, but double-decaf lattes with skim milk, and seemingly unlimited other choices. Nike offered personalized sneakers.

The Hartford's research shows that Millennials also are interested in customizing their employee benefits offerings. At the start of this year, The Hartford introduced DisabilityFLEX, a voluntary disability product which allows employees to customize their income protection in three ways—how much money they receive, when, and for how long if they are disabled.

With DisabilityFLEX and other voluntary benefits initiatives, The Hartford has relied on feedback from both customers and general consumer research to suggest new options. Laura Marzi, assistant vice president, marketing, group benefits at The Hartford, explains the part that Millennials have played in the development and marketing of its voluntary benefits products.

"A few years ago we began hearing from some of our larger group clients that they were interested in offering voluntary benefits, but that their younger workers had a harder time understanding the value of disability insurance, and an even hard time understanding term life insurance or AD&D. They asked for help," Marzi explains, "in creating worksite campaigns that would raise participation rates and make us look like an active steward of their benefits.

"We confirmed via focus group research that the younger workers were the ones with the hardest time seeing the value of these benefits. The feedback also told us that these younger consumers don't want to be educated by the insurance carrier about these products. They want to hear from a parent, a peer or a mentor—someone they trust.

"We took that to heart and tried to figure out how we could build a dialogue between Millennials and someone who would hold their trust and represent the value of protecting their income."

Ultimately, that led to The Hartford's partnership with Lindsey Pollak.

Pollak points out, however, that her online advice to Millennials is only a part of what can be helpful to Millennials in evaluating their benefits offerings. They also value personal guidance from a mentor-type person who can provide information and reassurance about their benefit decisions.

"Frankly, that person is likely to be a Baby Boomer," she says. "The person who handles the enrollment session could very easily be that mentor for these young workers. Maybe they are not meeting with everybody one-on-one. That's probably unrealistic. But it's very important that that person says, 'Here's my e-mail address, my instant message account, here's my Skype, here's my text number—get in touch with me if you want.' They want to know that if they have a question at two o'clock in the morning, they can get in touch with you."

The workforce is shifting—not overnight, but gradually—from Baby Boomers to Millennials. This new demographic group eventually may have the kind of impact on the market that their now-retiring predecessors have had. It makes sense for brokers and companies to pay attention to Millennials' needs now.

   

 

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