Understanding what drives consumers, their lifestyle and purchasing decisions is a continuous challenge for marketers and researchers. One of the largest demographic groups, the Millennial Generation (also known as Generation Y) is rapidly surpassing Baby Boomers in spending power. By 2030, Millennials are projected to makeup half of the U.S. workforce.
This cohort will have a significant impact on the future U.S. economy and is rapidly changing consumer models and marketing strategies. Born in the early 1980’s to the early 2000s, this generation grew-up in a highly connected, post-Internet world. They have multi-cultural values and are the most educated generation in U.S. history.
CAREFUL & FRUGAL
Millennials do not want to be sold to. This group shops and spends money differently than previous generations, partially because they have come of age in one of the worst economic climates since the Great Depression. These young adults do not make purchase decisions lightly due to having less disposable income. They do their research online and value word-of-mouth recommendations from a family member or friend.
- 2012 college graduates owe an average of $30,000 with an annual income of $34,500, the lowest average pay since 1998.
- The Urban Institute reported the average level of wealth of Millennials in 2010 was lower than people of the same age group in 1983.
ACCESS VERSUS OWNERSHIP
A large number of Millennials prefer to rent versus own. This trend doesn’t only apply to homeownership, but a wide variety of items including bikes, cars and clothing. Newer companies like Zipcar, Divvy Bikes and Rent the Runway have based their business models on collective sharing or collaborative consumption. But, just because this generation has delayed making major purchases that doesn’t mean that they don’t spend. In fact, Millennials already represent $1.3 trillion in consumer spending, and that number is expected to double by 2020. And, when this powerful group does shop, the majority of it is online.
Marketing to this digital savvy group of consumers is complex and challenging. They tend to distrust brand advertising. They thrive on ideas (Pintrest Passing Twitter in Popularity) and want to be inspired by experiences. And when they have a positive or negative experience with a product or service, this interconnected generation will rapidly share that experience with friends and family on their devices.
- 59% of Millennials use social media to find information, compared to only 29% of the 35+ crowd
- 34% of Millennial Women and 29% of Millennial Men read online articles to learn about new brands
- 20% of Millennial Women and 10% of Millennial Men learn about brands via social channels
- Nielsen found that 60% of Millennials consider print and newspapers to be “trustworthy” information sources
A large majority of Millennials view TV shows and movies on their laptops and tablets. Big events, such as big sports finals, are watched on the largest television screen they can locate. Once considered a dead medium, magazines are starting to re-emerge as a luxury with this group, with fashion and beauty magazines rapidly making up lost ground. As marketers, it is important to understand how this group of consumers interact with media and use their mobile devices—smartphones, laptops and tablets. Then, we need to leverage the right communication channels to integrate into their conversations and reach this group of consumers on a personal level.
Comply can help your organization gain a deeper understanding of today's customer to drive trust, respect and brand preference. Contact us today.