Teens: Give'em Credit! (Cover Story).

• Author: Bemstel, Janet Bighom
• Position: Banks target market teenagers - Statistical Data Included

The fiscally precocious teen-age market, 30.9-million strong, is the fastest-growing customer segment in the United States. bank marketers can't afford to ignore it. The secret of successfully reaching Generation Y is to look beyond the pierced tongues and dyed hair--and to think the way they do.

No, that's not Britney Spears talking. It's a demographic alert on Generation Y, the new teen market. With a population of 30.9 million, these "babies of the boomers" range between the ages of 12 and 20, and are the fastest-growing customer segment in America. They've also got bucks. According to research from the New York marketing services firm, YouthStream, this group spends $120 billion a year. They influence another $30 billion in annual spending, too, as the parent of any teen can confirm.

What's remarkable about the latest crop of adolescents, though, is their level of consumer sophistication. For example, in the December 2001 issue of the Florida Palm Beach Post's supplement called "KidsPost," kid reporters put together a holiday gift suggestion list. When shopping for 12-year-olds, these young scribes recommended, purchasing cell phones, clothes, music CDs, TVs, private phone, lines, laptop computers, money and gift cards. So much for the simpler days of "Babes in Toyland."

To their credit, teens are considering more complex financial decisions than how to score 'N Sync concert tickets. In a Junior Achievement poll last October, three out of four teens said that they would buy war bonds to support the U.S. government. Further revealing how profoundly affected they were by the September 11th terrorist attacks on America, 47 percent say they had given money to the national relief effort. Another 14 percent of teens said they had either raised money on their own (through fund-raisers such as car washes), or "had plans" to do so.

All of these facts should send a signal to financial institutions that there are opportunities to build relationships with the next generation of customer. According to Susan Cole of the ABA Education Foundation in Washington, D.C., many investment firms see the potential and are already cultivating the young-adult market. Her concern is that "a lot of bankers are shortsighted" and don't want to invest in a market that's not giving an immediate return on investment.

"Money is such a mystery to most people, especially for teens and young adults," she says. "Bankers can really position themselves as financial advisers. And what better time to create a stronghold then when people are just starting out?"

Start making 'cents'

Granted, many community banks offer early-savers clubs as a community service. In 1990 for example, Abington Savings Bank, became one of the 170 financial institutions that participated in the Saving Makes "Cents" program created by the Massachusetts Treasury office. It's designed as a fun and educational banking program adaptable for children in grades 3 through 6. Banks and schools work together to teach children basic monetary concepts, including how to open a savings account, the origin of money and basic budgeting skills.

"It's a customizable program, and we actually go into schools and do classroom work," explains Alison Charello, director of marketing for the 14-branch bank with $802 million in assets, based in...