What Gen Z Really Wants from Their Bank

Jim Marous (00:11):

Thank you for being here. I wish more people were here, not for a selfish reason, but because our next guest is going to bring it all, he can't do anything but. I just met him for the first time in person backstage. But it's going to be interesting because I'm going to bring a lot of dynamics that I didn't know I was going to bring into the conversation, because I think it's very important for people to realize that your personal role within your organization could not be more important than it is today.

Jim Marous (00:44):

We've talked about a lot of times it's the people that matter. It's the leadership that matters. It's can you bring it every day with a focus on the north star to reach that goal. And at the end of the day, it's not about technology that's going to get you there, it's about the people.

Jim Marous (01:01):

That's an unusual introduction for my next guest. Lamont Young is from Citizens Bank. It's a bank, if you're not familiar, in the northeast part of the country that competes with the biggest banks. There's a presence in that region where they are of all five, or actually all 10 of the biggest banks in the country.

Jim Marous (01:21):

And so, we're going to talk about how do you break out of that mole? How do you differentiate your organization through better personalized services? How do you identify what differentiates one consumer from another, one segment from another, one market from another?

Jim Marous (01:37):

So, we're going to get to that right now with Lamont Young from Citizens Bank. So, Lamont, I don't think I've ever done an introduction like that before, but it's interesting because I am really fortunate on this podcast and with the Financial Brand forum to meet amazing people that many times you can identify almost instantly what drives them, what makes them special.

Jim Marous (02:01):

Give me a little background. What is your background, not just at Citizens Bank, but going before that?

Lamont Young (02:08):

Funny enough, my background's not in banking. My background's actually in fashion. So, when I finished undergrad, I moved to New York and actually worked for fashion brands for my first couple of years out of school.

Lamont Young (02:19):

The whole banking thing, candidly, Jim, is just sort of sheer dumb luck. I had the opportunity to do a startup early on in my career. I serviced actually some of the banks in the southeast. And when business got a bit soft, I had an opportunity to join B of A, focused on their small business segment. And that's literally how I got into banking.

Lamont Young (02:37):

Funny enough, I thought that would be sort of a bridge job for me for maybe a year or two. And it's turned into a 17-year career in banking.

Jim Marous (02:44):

That's kind of crazy. That's not an aspirational goal in many cases. You probably, when you're in fashion, you go, "You know what, I'm hoping I can do really well so I can be in the banking industry."

Lamont Young (02:54):

Exactly.

Jim Marous (02:56):

I mentioned that Citizens Bank is in a hyper competitive environment. You're not the biggest bank in the region. You're not the smallest bank. But how does Citizens Bank, on a general basis, differentiate their brand among the giants?

Lamont Young (03:15):

That's a great question. I think it all starts off with people, banking is, whether we like it or not, it's a people-based business. Digital or not, you are serving humans at the end of the day. Our CEO Bruce Van Saun always talks about banking being a noble profession.

Lamont Young (03:31):

The fact is, when you remove all the statistics and remove all the financial reporting, what we help customers do on a day-to-day basis is achieve lifelong dreams. That young couple that's going to buy their first home. Banks enable that experience to actually happen.

Lamont Young (03:45):

Some kid who is going to be the first in his family to go to college, the services that we provide as financial institutions help to make that actually happen. When families are in crisis, we are amongst the institutions that are there for customers. So, this is inherently a people-based business.

Lamont Young (04:00):

And I think the way we differentiate ourselves is the reminder that we have the services that make us the type of organization that could support large, small businesses, could support consumers across the board. But we've got a small enough feel, we've got nimble enough nature to ourselves that we can feel like that hometown community bank.

Jim Marous (04:17):

So, you said when we started talking backstage, that Citizens Bank has made it a mission to serve each market, each segment, and actually each consumer individually with a recognition that the branch in New York City is not going to be the same branch that is in Providence, Rhode Island, or the same bank that's in Cleveland, Ohio. So, when did that mission, or when did that focus on that level of humanization and personalization come into play?

Lamont Young (04:48):

I honestly think it started back in 2014 when we did our IPO from RBS. So, Citizens was a wholly owned subsidiary by the Royal Bank of Scotland. We, IPO were the largest bank IPO in this country's history back in 2014.

Lamont Young (05:05):

And I think our CEO, Bruce Van Saun and the senior executives back then sort of said, we've got the makings of a great bank. We're in probably the wealthiest corridor in the U.S. playing in the northeast and portions of the Midwest, fraud and products and services standpoint. We have the type of products and services that could again help complex, commercial businesses all the way down to your general everyday consumer.

Lamont Young (05:30):

But what we didn't necessarily have is the people and the culture to create a really great bank. And I would tell you over the course of the last decade or so, we've infused a lot of talent into the organization. We've also cultivated talent that was already there, that was just sort of yearning for that opportunity to sort of break out.

Lamont Young (05:49):

Customer experience is an absolute mandate. We look at each customer on an individual level. I would say if you look at particularly the scores that we have around NPS for our customer-facing platforms, our colleague-facing platforms, they're off the charts because our people really do believe in the service-based model.

Lamont Young (06:07):

And the last thing that I would say is, if you look at what we've done in New York City over the last couple years, New York City is a microcosm of that hyperlocal strategy. There are a bunch of folks who a couple years ago thought we were insane for trying to be a regional bank to penetrate the market that is New York.

Lamont Young (06:22):

But to your point, we treated New York like we treat all of our markets. We wanted to make sure that we became a part of the communities that we actually serve. We hired folks that were from those communities. We treated Brooklyn differently as a borough than we treated the Bronx. We treated the Bronx different as a borough than we treated Queens.

Lamont Young (06:37):

And that hyper-local strategies has really allowed us to create, I think, a really stronghold on New York and build a really strong brand presence in the toughest market in the world.

Jim Marous (06:46):

So, it's interesting. My podcast and our articles of The Financial Brand tends to feature Citizens Bank, I'd say is much or more than any other organization for a couple reasons. Number one, they have a great PR team that continues to reach out to saying, "Hey, would you like to talk to this person about this subject matter?"

Jim Marous (07:03):

Secondly, and you mentioned the acquiring, the searching out and the cultivation of some amazing leaders. I'm a watch for the industry. That's what I do for a business. And one thing that interested me, and you mentioned your IPO, Citizens Bank at that time, I would say was an underperforming institution from a brand perspective, if nothing else, I'm not talking financial. But it was hard to define how were they different than anybody around them through the acquisition of new people, through the integration of people in the culture as it trickled down.

Jim Marous (07:40):

I don't think I've interviewed anybody from Citizens Bank that just didn't awe me in one way or the other, in their passion for what they do, their enthusiasm for what they do. And it made me realize and remember as I tried to introduce you at the beginning, Lamont, that you really have to love what you do to do it well because it does transcend the organization, especially at your level.

Jim Marous (08:03):

I say that because in order to implement a brand-new strategy, a brand-new focus, a brand-new customer focus, and to change so much so quickly, the leaders have to be aligned, and they have to be enthusiastic. They got to bring it every single day.

Jim Marous (08:21):

So, when you started with Citizens, you said you were at that transition point when everything was new again, what was the organization's first mission at that time, and the reason I'm giving this foundation around the whole segmentation issue is because it all builds on each other. It builds from the ground up. So, what was the focus of the organization at that point?

Lamont Young (08:43):

So, I think if you were to look at us maybe 12 years ago, I think we underserved clients across all of our segments. So, we were one of those sleepy base banks that provided just enough of a solution set, but certainly didn't have that feel where, whether you're talking about investing in products and services, allowing our colleagues to have the tools that are required to service clients.

Lamont Young (09:04):

Well, we just sort of did things good enough. I think fast forward to the IPO and that was a vision of where the bank could go. Our mission to really help our clients across all the different segments achieve their financial goals was our sort of laser focus. And if you look at how we galvanize folks who had been Citizens' lifers to reinvigorate that culture, if you look at how we infuse strategically good, strong talent from the outside, 12 years ago I happened to be one of those sort of folks.

Lamont Young (09:33):

I think that was the sort of formula that was necessary to take a bit of a sleepy regional bank and sort of make us a bit of a powerhouse nationally. Although, we play that regional bank role, from a size and scale standpoint. We compete nationally. We've got footprint that covers all 48 continuous states.

Lamont Young (09:52):

If you notice what we've been doing over the last couple years with the advent and scaling of our private bank, man at a time where most banks were actually playing a bit of a defense, we decided to go on offense and take a stark opportunity to really build out a private bank. And we happened to report earnings today. And the private bank was one of those sort of cornerstones or highlights of our earnings reports this afternoon.

Jim Marous (10:11):

So, that being said, and during the process of defining your brand and what you wanted to be, what your north star was, we were going through digital transformation at the beginning of truly digital banking more than just the mobile app. What was your focus ... an organization for how you balanced the technology stack with the human stack?

Lamont Young (10:32):

Yeah. I think the most important thing for us is recognizing that we as an organization, we're going to make a long-term bet on a hybrid strategy. We knew that the industry was going, especially when it comes to retail customers, the industry was going more self-service.

Lamont Young (10:47):

And we went as the industry went, but we also recognized that clients, regardless of how they engaged with us, wanted to have experiences that were unique across the board. My entire team exists because the bank actually believes in an omni-channel solution.

Lamont Young (11:00):

And we want to provide that same level of wonderful digital experience for customers. Whether you go into one of our branches, you call us on the phone, or you actually handle your business with us via self-service tools.

Jim Marous (11:10):

So, we've set the foundation. And a lot of our focus now is everybody's looking to acquire more customers, to build more relationships, most importantly, how do we make it so we don't just have the account, especially the legacy accounts because people won't close them. But they may be gone already.

Jim Marous (11:29):

So, when you look at the expansion, you've already mentioned what you do on the branch level to make it so that you really try to hyper personalize around the environment you're in. But when you look at the new segments, and we're going to talk a little bit about Gen Z and Gen X.

Jim Marous (11:46):

What have you done for these very unique segments and I think more unique than we thought they were. Because it's not defined by how they bank as much as how they want their bank to serve them. How are you doing that?

Lamont Young (12:01):

It's an interesting sort of view of these particular segments. Oftentimes when you think about Gen Xers and baby boomers, it's sort of how do those segments actually fit within the banking ecosystem? I think it's the exact opposite for millennials and Gen Zs. It's how does a banking ecosystem fit into their lives versus this sort of other way around.

Lamont Young (12:20):

I think for us it starts off by understanding sort of the needs of these segments and treating them the same way we treat our markets as sort of individuals. I've had conversations with peers across our industry about this sort of advent of personalization. And that's a buzzword that I think you guys all hear, probably six ways to Sunday.

Lamont Young (12:38):

But personalization without the other two legs of the stool, in my opinion, is where I think banks miss the boat. So, when I think about the three legs of the stool, it's not just personalized. It has to be highly contextual, and it has to be very, very timely. And let me give you a perfect example from my own personal life that sort of brings this to life.

Lamont Young (12:59):

So, I've got two boys that are in college, one going into, this fall, his senior year, the other who will be going into his sophomore year. And I've gotten all sorts of communications from brands trying to sell me on student loan packages and that sort of thing. So, that is personal.

Lamont Young (13:13):

So, they know enough about me to know that I have college age kids, but that's only step one. When I talk about something being contextual, if you knew that my oldest son is an athlete and is on scholarship, you'd recognize you probably shouldn't send me anything about financing this education because it's already taken care of.

Lamont Young (13:29):

If you knew about our savings habits for our youngest son, fact of the matter is God willing, there'll be enough money in his 529 plan to actually get him through four years of school.

Lamont Young (13:38):

This is where not being contextual, I think misses the point around personalization and the timeliness is, imagine if you had started these conversations with me and my family seven or eight years ago before the boys got into school. Imagine how you could have cultivated that relationship with us over time so that if we did need extra help in finance education, we could do that.

Lamont Young (13:58):

So, I like to look at the way in which we attack Gen Z and millennials is by really making sure that our experiences, our conversations, our interactions with them are not only personalized, but they're contextual to the individual. And they're highly timely. Whereas my kids say, "Don't tell me about something that already happened. Tell me about something that might happen so I can do something about it."

Jim Marous (14:17):

Well, anybody who's seen me over the last few days realize I referenced the GPS in the car quite often saying, you can't just tell it to go north but not just tell me the route. Be sure to remind me when I got to take a detour because something's happened ahead of me. Give me the straightest place because I don't want to think about it.

Jim Marous (14:35):

I go back to the map days. I mean, I go back to we're looking at paper, you're making phone calls to the payphone. All these things that no longer exist. The reality is you talk about contextual engagement; you talk about contextual serving of the consumer. We don't know those answers intimately.

Jim Marous (14:54):

So, the fact that they communicate with you knowing that you had college age children is one thing. How does Citizens Bank try to build that knowledge base that takes it to the next level rather than just getting it surface view of the consumer based on an age and maybe the fact that oh geez, we know they have kids.

Lamont Young (15:13):

Yeah. So, we've invested heavily over the last couple years in data and analytics. Being able to gather publicly available information on our clients without being creepy, I think is one way in which we've made experiences feel that much better for our users.

Lamont Young (15:30):

For instance, a couple years back, we tried to revamp the entire home equity experience. So, any of you guys have gone through and done a traditional home equity is probably one of the most cumbersome processes that you would go through.

Lamont Young (15:41):

And it's a cumbersome process whether or not your incumbent bank, who holds your mortgage is your provider of the home equity or if it's a third-party bank. So, we just sat back and sort of reimagined the entire experience. Availability of home values like no other time in sort of American history. I can find out the value of almost any home in the U.S. by going on ChatGPT right now. So, we said, hey, if home val-

Jim Marous (16:05):

And they're getting from Zillow.

Lamont Young (16:07):

And they're from Zillow and everywhere else. And so, if home values are available and we can make estimates on the estimated equity in a home, why should we have an application process that takes customers through that entire process understanding what that loan to debt ratio is on a home?

Lamont Young (16:22):

And if we can figure all that out and we actually understand the credit box of our clients, shouldn't we be going out and proactively offering credit from a home equity standpoint for those customers that are eligible?

Lamont Young (16:33):

And so, we took a process for us around traditional home equity that would've taken on an average between 30 and 45 days. And now our home equity fast line product, candidly, we can close most of many of our loans in 48 hours or less.

Lamont Young (16:48):

So, taking a process that felt really cumbersome, really paper-based and making it very digital, making it very slick, we not only matched the needs of our clients, but we exceeded those needs across the board.

Jim Marous (17:00):

Boy, you talk about the whole mortgage process and the whole loan process. And I got great stories, where a financial institution only paid attention to my mortgage that I had way too long at the old rate, at a high rate. They only paid attention when we were going to be getting a small place in Florida.

Jim Marous (17:17):

And then they're all over me going, "Hey, we want to help you." I said, "You know, guys, you weren't here in my refinancing. Guess what, when I got the small place, we decided to refinance the existing home. And you're losing that mortgage. What you thought you didn't want to stir up the hornet's nest. Now it's gone."

Jim Marous (17:33):

And that whole dynamic, the getting information from multiple places and building a story around it, is there any future in banking to be able to ask questions and actually apply that? So, the finding out of, geez, you didn't take this, is there a reason why you didn't?

Jim Marous (17:49):

And making it easy for a consumer to have interactions with you that shows it's not getting creepy if you're going to give me value as opposed to pointing the file cabinet. Is there ways to do that in banking, do you believe?

Lamont Young (18:00):

So, we started a process a couple years back that we called sort of the checkup process. And checkup was designed like you would do if you went to a doctor's office. It was a health check. So, the notion was not for Citizens to either digitally or in person to try to find that next cross all opportunity.

Lamont Young (18:16):

It was really about making sure that from a financial health perspective, we had the healthiest customers possible. The healthier our customers, the more likely they are when they had a financial need to actually sort of choose us.

Lamont Young (18:26):

What our checkup process helped us do is over the course of time uncover needs for our customers. Go back to that same conversation that we just had about my kids being in school. Maybe there wasn't a cross-sale opportunity for us six years ago when I had that checkup conversation, but maybe two years from now, that is the right time.

Lamont Young (18:45):

The only way in which we can actually have that sort of warmly, the only way we stay at the top of the consideration set for our clients and even some of our prospects, is to cultivate that relationship over the course of time.

Lamont Young (18:55):

And when I think about particularly millennials and Gen Z, this is what these folks actually want. You don't necessarily capture them, especially if you're a traditional financial brand at that sort of first step. Most of what Gen Z and millennials will tell you where they get their financial information is not necessarily from traditional banks.

Lamont Young (19:13):

They're online, they're getting their information from influencers, so forth and so on. But if you can be one of those institutions that provides that nugget of information that helps me feel good, that takes away some of the anxiety that I actually have about my finances. And over the course of time, you can build a relationship with me. You can be one of those institutions that is the top of the consideration set when I actually have a good financial need.

Lamont Young (19:34):

And that is our strategy. It's about building long-term relationships with clients, providing value at every turn. And we think we can actually grow with clients over the course of time. And we look at our Gen Z and our millennial population no differently.

Jim Marous (19:45):

Well, it's interesting because we see in banking today that while we think we have the customer as a secure, loyal customer because they've been around forever, we don't dig deep enough to realize we have the account, in some cases, it's too hard or it's just too cumbersome to close it. I don't have to close it open to another one, and I certainly don't have to close it to open relations beyond my traditional financial institution.

Jim Marous (20:08):

What does Citizens do to try to stop what I'm going to call the silent attrition that's happened to every financial institution, but we don't pay attention to it. Whatever it is. Financial institutions say, "I got only a 2% attritionary." I go, "That is not going to make me feel good." But you know where that money's going every paycheck. How do you do that?

Lamont Young (20:26):

So, passive churn is a real sort of thing across all financial institutions, large and small. I think the challenge for institutions is to sort of recognize what are those triggers that begin the process of sort of passive churn. I think, you would've sort of rolled the clock back 10, 15 years ago.

Lamont Young (20:44):

Most institutions would've told you, "Hey, if we can get customers in this sort of sticky products, if I can get you into a checking account and I can get you a direct deposit, if I can get you into bill pay," these are all things that are sticky services. Candidly, they're really too difficult for customers to actually sort of switch.

Lamont Young (21:00):

Today, I can actually switch my direct deposit in seconds. I can switch my bill pay over in minutes. Those things that you would consider traditional sticky, just aren't there. We use some internal complex algorithms to take a look at the propensity models of people that are likely to attrite.

Lamont Young (21:17):

We use that information to sort of engage with those customers to understand how do we correct those behaviors that actually lead to that sort of passive churn before that passive churn actually happens. And in some cases, it is as simple as providing the customer with a value-added insight.

Lamont Young (21:33):

Something as simple as, "Hey, we see that you've got multiple transactions for the same service on your account, here's how we can actually save you a buck." None of you guys have seen any shortage of commercials out there where there's some banking app that's offering you the ability to cancel some subscription service. That is good because it's personalized.

Lamont Young (21:51):

But I still go back to the point, you've got to get really highly contextual. So, great, you can cancel that, and you can save me 150 bucks a year, but what does that 150 bucks actually do? Can I invest that money over the course of time?

Lamont Young (22:04):

And this is where I think some of the fintech players do very well. If you look at the way, Acorns and Betterment and some of these other apps do over the course of time talking about fractional shares and all these sorts of things, like they do that very, very well. Where it's not just a personalized component, but how do I take it to the next level where I make it very highly contextual and how I make it very timely to me.

Lamont Young (22:23):

And so, that's the journey that we find ourselves on. I'd love to say that we're a hundred percent there, but I think we're on a very strong journey to build relationships with clients over the course of time and build lasting relationships with clients over the time.

Jim Marous (22:35):

So, your boys, they both probably went into branch once to open their accounts, and I would imagine probably Citizens Bank. And they have not walked in since. And their transactions are probably more driven by Venmo and by maybe a credit card that they got earlier in their college life that somebody got them all hyped up about this.

Jim Marous (23:03):

How do we understand that consumer number one, but even more importantly, how do we make it so that they believe we're looking out for them as opposed to simply trying to pick up a fee or a rate or a new product?

Lamont Young (23:15):

It's a great question, but I would say this is sort of the benefit of being a part of a bank and having a customer's primary relationship. Because you already have all the data that you actually sort of need on it. So, if we were to mine my boys' accounts and all the activity that they do, so my youngest son who goes to school in metro Atlanta, he goes to Clark Atlanta University.

Lamont Young (23:35):

If you scour his accounts, you would see a bunch of DoorDash passes for food that he's eating around campus. And so, sort of know, "Hey, this kid does not like the diner hall at Clark Atlanta University. He's calling his father every week for more cash so he can actually sort of eat out." What does this mean about people?

Jim Marous (23:50):

I'm going to interrupt you. The good news is he gets that immediately. I'm sorry, back in my day, I had to plan a week ahead of time because I'd have to call up my parents on a collect call. They'd say, "Oh, he is not here." They call me back, I ask for money, they send a check. It gets deposited on a Thursday; I can't get it cleared until Monday. So, I have to plan ahead when I need those books.

Lamont Young (24:09):

Yeah. I agree. But my kids will say they have to plan ahead as well because it's like, "Well, hey, I need the money at three o'clock on a Thursday afternoon, and I know dad is in some meeting and he is not going to check his text messages. So, do I call him and interrupt this meeting?" And he sees it like ... so they still do that.

Lamont Young (24:25):

But my point is, the richness of data that we have on the accounts of our clients is no shortage of world class. The challenge for us as institutions is not, do we have the data, is can we actually make the data usable so that we can provide those very contextual, relevant experiences that I think the Gen Z and millennials and candidly guys, anybody who is what I would consider a digital native.

Lamont Young (24:49):

Digital natives come in all forms. There are boomers, there are Gen Xers like myself across the board. But that is the value of being able to take data, cleanse it, hydrate, synthesize, so that you can be relevant and contextual.

Lamont Young (25:01):

My oldest son, even though the two boys grew up in the same household, same parents, whatever the case may be, could not be any different than his little brother. My oldest son is an athlete on full scholarship. And so, if you look at all his purchases, they're all for supplements and stuff like that whatever the case, they're the same, but they're sort of different.

Lamont Young (25:18):

And so, if you were to communicate to my two boys in the exact same way, because they're brothers, you would miss the point of being very contextual and relevant. So, where my oldest son it maybe about making sure that he's got discounts on the services that he needs in order to make them this world-class athlete.

Lamont Young (25:35):

For my youngest son, it's about the fact that he's cramming for studies at two o'clock in the morning, he needs food for that sort of brain power, getting down to that level of detail candidly, you have that at your fingertips. The hard part about it is making that data usable to be able to go out and proactively talk to your customers.

Jim Marous (25:52):

Well, and it's interesting because we sometimes take it to the 20-yard line and let it go there where we say at least we know about the customer. I get frustrated. I say it on way too many of my podcasts. It's one thing for my bank to know me. It's another thing for them to show me they know me.

Jim Marous (26:10):

My business bank knows how much I need on a monthly basis and how much I use, what I do on my business basis. Basically, only that they're a deposit warehouse. My personal bank knows about me. They know a lot more about my transactions, but neither one of them are my primary financial institution from a mindset. My business bank, it's PayPal, my other bank, I'd say it's Acorns. I built more in savings through Acorns than I ever did from my bank.

Jim Marous (26:39):

Now what's really frustrating to me is on twice a month basis, I transfer money from my business bank to my personal bank because my business bank does not use the service that makes it easy to transfer. I transfer the money by taking a picture of check twice a month.

Jim Marous (26:57):

I'm now doing it out of spite just to see which bank is going to notice this happens all the time, and you're going to come to me with a better solution. It's what I did when I bought my car. I said, I know they know what I'm test driving because there's a way to get data from the credit bureau. Because I know, because every dealer, every manufacturers after me immediately, but no bank said, I want to finance you.

Jim Marous (27:19):

The bank that did finance me was a floor plan loan at Ally. And since then, they've continued to try to build my relationship on a personalized basis. I say that because the way funds flow can tell you a lot. Does Citizens Bank pay attention to funds flow to figure out who your competitors are or who your clients' competitors are?

Lamont Young (27:38):

It is a fundamental cornerstone of our entire enterprise payment strategy to recognize inflows of funds, to recognize outflows of funds, and to try to be that interface that the consumer engages with when they want those funds to sort of flow.

Lamont Young (27:56):

I've had probably many internal talks about this particular subject. The last thing we want to do is to become the holding bank and have another bank own the experience for sort of clients. Exactly what you're sort of talking about.

Lamont Young (28:07):

My kids and you're exactly right. If you look at the traditional services that they utilize to move money, it is the Venmos, it's the sort of Cash Apps. I had a funny conversation with my youngest about why do I even need a bank account? I just put everything in Cash App and when I need the money, I can send it out when I need to get money I call it back in. I think over the course of time-

Jim Marous (28:28):

And you tell them, “I work for a bank. And I'm still paying your bills.” You're staying with the bank.

Lamont Young (28:33):

But more importantly, I tell him over the course of time, your needs are actually going to change. So, your needs as a ninth grader in high school were going to be different than his needs now as a 19-year-old in college. Your needs as a 22-year-old when you actually graduate are going to be completely different.

Lamont Young (28:50):

And this is where this whole notion of earning trust and building relationships with the clients, especially your Gen Z and millennials, because you don't get the benefit of having that sort of trust be inherent right away. I know for me, there was no question because of how my parents bank, that I was going to go to sort of traditional bank. My kids have so many choices that I didn't have sort of growing up. And so, the need to be able to create long-lasting relationships over time becomes really, really important.

Lamont Young (29:22):

It's also important in that I think Gen Zs and millennials are comfortable with a much more fragmented banking experience, than their predecessors. Again, that doesn't mean they're the only generations because there are folks who are digitally native who don't mind at all spreading their banking relationship over multiple institutions.

Lamont Young (29:37):

Again, what I think what you don't want to have is you don't want to either be the institution where you're just the holding bank where you don't actually own that relationship with the client. And that's what we're trying to do at Citizens over the course of time, own those relationships with clients individual day after day by providing really sound advice whether it comes through digital channels or physical channels.

Lamont Young (29:55):

And at the end of the day, being proactive in terms of our communication to customers, allowing us to let customers know what likely will happen and giving them an opportunity to do something about it before it actually does happen.

Jim Marous (30:05):

So, let's take the Gen Z generation. I think, what have you learned at Citizens Bank that surprised you about the Gen Z without taking your sons into context, within the broader sense.

Lamont Young (30:15):

So, it's funny enough, you read a lot about the fact that they are so likely to look for sources of financial information outside of traditional the traditional banking ecosystem. That said, Gen Z will search for human-based advice, but that advice has to be earned over the course of time.

Lamont Young (30:39):

So, it's not like they won't talk to a human, but they're more likely to want to explore because they've got so many places where they can actually sort of gather information. So, it's not that I won't listen to Jim, but I want Jim's advice, and I want to scour the internet and I want to find a bunch of different sources to be able to compare them.

Lamont Young (30:54):

So, what I think has been really, really surprising for us is that they're so much more open to listing than I think we give this generation actual credit for. And this is why I go back to our conservative strategy of saying, hey, if we can just give them a couple of clear nuggets of information, something that can actually help to start that trust over the course of time when their needs become more complex, we can be one of those places where they turn to directly.

Lamont Young (31:19):

I think the other thing that's very, very surprising is that amongst Gen Zs, they are what I would consider the sort of entrepreneurial generation. There's so many members of this generation are graduating from school whether it's high school or in college.

Lamont Young (31:34):

And their first thought is, I don't want to necessarily go and work for a large institution. I want to start off and I want to be an entrepreneur. I had the opportunity to sit with a few startups over the last couple weeks and just the mentality of some of these sort of barging entrepreneurs, it's so much different than when I was in college in the late 90s.

Jim Marous (31:52):

Yeah. It's interesting too because we find that the way they educate themselves is vastly different. They're going to school. And you feel kind of lucky as a parent when your kid goes to school because you go, I know they could've learned a lot of this through YouTube.

Jim Marous (32:07):

And that sounds unusual, but there's already challenges about could they get a better education by searching out themselves. But it takes take a different kind of person too.

Jim Marous (32:15):

From that perspective, as you look in the future with Citizens Bank, from the retail consumer standpoint, as you're doing, what do you want to be able to accomplish on behalf of your consumers, your customers in the next two years? What do you want to have at your fingertips that today is still you're working on?

Lamont Young (32:37):

So, I think customer experience for us is one of those never ending journeys. Given the fact that our approach is going to be sort of hybrid digital and hybrid in person, I think what we're on sort of an evolutionary journey to do today is to take that awesome sort of empathy that exists in your human assisted channels and apply more of that to your sort of digital channels.

Lamont Young (33:01):

I'm the first to sort of say at some point in time, whether you're a large bank or you're a credit union, 95% ish of your transactions that happen with your retail consumer base are going to happen over a mobile phone, a mobile app, desktop banking, you sort of name it.

Lamont Young (33:16):

But if you think about the hundreds of billions of transactions that banks and credit unions do that 5% or less, that isn't being done via self-service. It's still a ton of transactions or I've said to a bunch of folks in our organization, if the next three years we do a billion transactions and 95% of those transactions go through self-service channels, that's still 50 million transactions that a human is actually engaged with.

Lamont Young (33:39):

Which is why our approach of not selling those human assisted channels short is so incredibly important. I think our evolution is going to be one where we take that awesome sort of empathetic view that you can have when you're dealing with a colleague. Take that and apply that principle to what we do within digital.

Lamont Young (33:58):

Five years ago I had the privilege of starting our journey design practice at Citizens and regardless of the client job to be done, we spent a lot of time really thinking about the moments that matter in any process and ensuring that we get those moments that matter right all the time.

Lamont Young (34:14):

Anybody here in the mortgage business will tell you in that entire mortgage process, there's one moment that absolutely matters and that is closing. You screw that up; you screw the entire thing up. And so, we look at our moments that matter just like that.

Lamont Young (34:25):

What are those places that are inflection points in relationship? Even if you think about something as simplistic as being able to make a fraud claim, the complexity in how consumers are thinking at any given time, how they're feeling, your ability to provide that really good empathy could take a moment like fraud where it feels like it's a negative and actually turn it positive because you feel like your bank has gotten your back.

Lamont Young (34:46):

So, that is my vision for what I hope that we're going to be able to accomplish over the next couple years to not only make the technology and the client experience seamless across the assisted channels and the digital channels, but bring that real empathy to that sort of self-service direction, making sure that our communications, I make sure our language feels like your human talking to another human, even if it's just an interface.

Jim Marous (35:10):

How do you let the marketplace know that you're doing that? Because it's great for your existing customers to feel that way, but when you're looking to get new customers, you're looking to grow. We all talk the game really well, even if we're not providing it. We're all talking about personalization; we're all talking about empathy. I want to look out for the consumer. When you reach that goal to whatever level, how do you let the marketplace know that that's available?

Lamont Young (35:39):

So, I'd say it all starts off with is your brand authentically what you're trying to sell to the consumer? You started off this question talking about Citizens' pre-IPO and talking about the infusion of both talent from the outside and the cultivation of internal talent.

Lamont Young (35:55):

And I look at the journey that we're on as an organization is much in the same way. The things that we actually do. Us going into New York City at a time where people thought this bank was crazy trying to attack New York. This sort of focus that we have on building a private bank at a time where most banks are playing defense.

Lamont Young (36:12):

The things that we do at Citizens, I think are authentic to the leadership teams that are there. They're authentic to the personality of our 19,000 associates. And so, the way in which I think we're going to let customers who don't know us today know is by continuing to have that authentic brand, that feel of, hey, we are big enough to support any complex need that you actually have, but we are small enough to focus on you as an individual.

Lamont Young (36:35):

We're winning relationships with small business because of that strategy. We're winning relationships with our private banking clients from that strategy. And I think we'll continue to expand out. And when relationships on the retail side of the house with that same kind of hyper focus on being ourselves and ourselves is really trying to help clients achieve the best of their financial fixtures.

Jim Marous (36:54):

We all like to think this has been a straight journey that you've gotten better every day. What's the biggest challenge that you face at Citizens or in banking in general, that kind of keeps you up in that because it's a challenge that it's static, it's the friction, whatever else towards your journey.

Lamont Young (37:14):

I would say if you put any of my peers who are heads of digital or otherwise at regional banks, what they'll tell you is that the toughest part of the job is, generally speaking, most regional banks like ours are built on a series of acquisitions.

Lamont Young (37:27):

So, it was, this bank that used to be independent is now become a part of Citizens in this bank. And so, if you look at the technology stacks of most regional banks, there are an amalgamation of a whole lot of stuff. I think the biggest challenge for all of us is going to be how do you walk and chew gum at the same time?

Lamont Young (37:46):

How do you deliver the types of experiences that are required to bring out the results that you and I just talked about? But at the same time, how do you begin to start to modernize your back office, modernize your tech stack so that those things become seamless.

Lamont Young (37:59):

What the neo banks have as an advantage over your traditional banks is they don't have the legacy, technical debt that I think we actually have. And so, I won't say that keeps me up at night anymore because we've got a fabulous CIO we've got a strong, engineering team. I think we've onboarded some of the best and brightest of engineering talent and I think we've got the right strategy.

Lamont Young (38:20):

But it is one of those things where you could say to yourself, "Man, if we were only 10 years ahead, if we were only five years ahead, imagine all the really cool stuff that we could actually do for our clients."

Jim Marous (38:30):

But that takes focus. And the reality is, and shameless plug here for the podcast is that I suggest to people, look at our podcast and find out how many had Citizens Bank in it and listen to all of them. Because of one consistency in all that and you keep on referring to it. And I think you take it for granted because you came in at the time when all this was taking place was not how smart your leadership is. Not that they're not, but they are.

Jim Marous (38:55):

But how passionate they are. How focused they are and they're all singing from the same hymnal. The reality is if the leadership is not in place that says we are going to change the world, and if it didn't come from the top, it would not work.

Jim Marous (39:10):

And I think the organization that I interviewed that I see, that are doing the best in the industry are the ones that have the passion. The Jennifer Smith from two days ago, from Zion's Bank, the Liz Wolverton from Synovus, who comes all the time with both — because of the passion they have.

Jim Marous (39:29):

I think that's a very important element because it gets you where you want to go faster than it would by technology because it's not a technology game as much as it's a human game. Finally, looking forward, looking ahead, what do you get excited about as far as the future?

Lamont Young (39:50):

Uncertainty, if that is a thing that I could sort of talk through. The uncertainty of waking up every day and understanding that the marketplace could change, new opportunities could come up, is I think the thing that sort of drives me, and it's probably a very, very weird answer to what I think is a very straightforward question from you.

Lamont Young (40:08):

But I actually enjoy the uncertainty of knowing that our industry is in such a moment, in a history of real flux. That uncertainty, I think provides banks with opportunities that I don't think necessarily, if you were to roll back banking 20 years ago, even before I started in the industry, I don't think banks took advantage of.

Lamont Young (40:26):

I've jokingly said to a bunch of folks, if banks were on our game, firms like PayPal would not exist. Square would not exist.

Jim Marous (40:36):

Acorns.

Lamont Young (40:36):

Would not exist.

Jim Marous (40:38):

Acorns was a Christmas club plus a monthly savings plan.

Lamont Young (40:42):

Absolutely. And that uncertainty, coupled with the fact that I think we now take a look at sort of the technology firms, fintech, you name it, as less of an individual threat and more of a one, a push to provide better experience, but two, as potential partners that can help us elevate it and that uncertainty.

Lamont Young (41:04):

We had dinner last night with a group of entrepreneurs who were trying to solve an old adage problem, which is around youth-based banking. And it wasn't that somehow the broader idea that they came up with was necessarily new, but their approach to the idea was new and exciting. And I felt the energy and you talk about passion within our group, within our leadership team.

Lamont Young (41:24):

I think that's the thing that sort of sets us apart, new leaders, existing leaders. Folks just aren't afraid to start to think about the world in a bit of a different stake. We have an internal process that I believe is probably second to none in the industry where we get comfortable around doing what I would consider very respectful challenges.

[Music Playing]

Lamont Young (41:44):

How many of you guys have been a part of an institution where something was done the same way for the last 30 years and nobody feels empowered enough to challenge that. I think we've got an internal view where we feel like as key leaders, we can respectfully challenge each other and it doesn't feel like I'm challenging your intelligence and just thinking about the idea.

Lamont Young (42:01):

Because trust me, that thing that's been in place for 30 years, somebody thought it was a good idea at one time or the other, doesn't necessarily mean that idea can't be improved though.

Jim Marous (42:07):

It may have been the only idea. I mean, I look back to the … card days, which was before your days in banking, but we only got rid of — card when somebody said, "All you have to do is know your customer. You can do this differently with digital."

Jim Marous (42:18):

Digital gives us a lot of capabilities. I think, it's interesting because you talk about the uncertainty, Sathish from Ally said, what makes them excited is knowing that there's 25 young guys around, young guys and women around that could upend everything that Ally's doing in about a three-month period through digital.

Jim Marous (42:38):

He goes, "I'm hoping I'm staying ahead of that." But the reality is he found that not as a challenge. He found that as, man that keeps me fired up every day. Because that's what I'm fighting against. I'm fighting against the unknown.

Jim Marous (42:48):

Lamont, I really appreciate your time-

Lamont Young (42:50):

Thank you so much.

Jim Marous (42:51):

And I appreciate getting to meet you and getting to understand more about who you are. And we hope you keep your sons as customers of Citizens Bank as they're looking. Yep. Thank you.

Lamont Young (43:02):

Thanks so much.

Jim Marous (43:04):

Great. Thank you very much.