When looking to spread the word about mutual funds and other investment strategies to Generation Y Investors, financial services firms should consider new media, according to Cambridge, Mass.-based consulting firm Cogent Research.

Generation Y investors—those now 30 or younger—comprise nearly 10% of all affluent investors in the U.S. And, these clients and prospects get financial information much differently from the way their parents and even their older siblings learn about investments.

“If you want to gain a quick appreciation for how different Gen Y is in the way it consumes information, simply ask 20-somethings how they get their news, stay current with their favorite programs, and learn about new products,” Meredith Lloyd Rice, Cogent Research senior project director, said in a statement. “The chances are high that TV commercials, newspapers, and radio won’t even be part of the equation.”

Cogent’s recent study covered more than 4,000 U.S. individuals with investable assets of at least $100,000. Respondents were asked if they recalled contacts with any mutual fund provider within the past year. While 75% of non-Gen Y investors mentioned advertising, only 57% of Gen Y respondents had that answer: 18 percentage points below their elders.

In response to the same question, only 4% of non-Gen Y investors said they recalled mutual fund contacts via social media, while 35% of Gen Y respondents recalled such contacts. This 31-percentage-point difference was by far the largest differential in the Cogent report.

The good news is that Cogent also found an 18-point differential in recalling mutual fund contacts from advisors. Here, Gen Y was more likely to remember mutual fund recommendations from advisors (42%) than non-Gen Y investors (24%) recalled.

The Cogent report also indicates that Gen Y is a fertile market for new investment ideas: “Affluent investors overall are familiar with an average of 10.6 mutual fund firms, while Gen Y investors are typically aware of half as many (5.3 brands),” Cogent pointed out. “Additionally, Gen Y investors are almost twice as likely to depend on advisors for provider recommendations, reflecting their relative lack of experience with investing.”

Nevertheless, advisors who want to tap this potentially lucrative source of future clients should weigh alternative approaches. Social media platforms, company websites, and blogs are among the ways Cogent suggested to engage with Gen Y investors.

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