Millennials, the Enigma Generation, Generation Y — no matter what term they’re given, they continue to evade marketers (even big name brands) when it comes to what this generation wants. Millennials are predicted to spend $1.3 trillion in 2014 and make up a huge portion of social media users who share content every day, including some from brands that that they support and evangelize. "Make no mistake about it, there is a lot at stake for brands when it comes to marketing to this group, which is in fact larger in size than Baby Boomers by nearly 3 million," according to Steve Olenski, senior content strategist at Oracle Responsys.
So, how have some brands succeeded at cracking the Millennial nut? Jeff Fromm, author and Millennial expert who lead the development of Barkley report, American Millennials: Deciphering the Enigma Generation, breaks down what makes Millennials tick and what brands need to do to prepare for the next baffling generation (popularly called Generation Z) as they enter the marketplace. Here are a few of Fromm’s insights:
Q: What are key characteristics of brands that typically engage Millennials?
A: Our theory is that almost all brands that will win big in the future will be creating high participation and share-worthy content. Participation means that consumers can co-create the product or service with the brand, be a part of co-creating the customer journey and/or the market.
Q: What makes content “share worthy”?
A: To be share worthy means that you’re authentic, transparent and stand for something other than the bottom-line. Ultimately, what we’ve seen with the relationship between brands and Millennials is that sharing is about the sharer. A consumer shares something about your brand based on how he or she feels, it's not about the brand, it's about the consumer and the meaning behind the content. All brands that are both “high participation” and “high share worthy” also follow another schema which is uniqueness. Brands that create meaningful and unique interactions will be the most successful with Millennials.
Q: What are some best practices for marketing to Millennials?
A: Keep in mind these three key points. First, remember that Millennials are a diverse group. Pay attention to the different subsets of Millennials. Young adulthood is a time of sweeping life change, so some Millennials are settled, have families and decent jobs, some are unemployed, just starting their careers.
Second, be open and accessible. Yes, this certainly means be digitally savvy with all communications — but that's table stakes with Millennials. Being open also means telling Millennials how you run your business and make your products. They take pride in being educated and connected. The more you can share, the more they will love you.
Third, be affordable. Millennials will not trade up for much, so provide a true value and point of difference (beyond just a luxury label) if you want to connect. Diffusion brands at Target are a primary example of satisfying Millennials' desire for style while still remaining accessible financially.
Q: How should marketers begin to prepare for outreach to younger Millennials and Gen-Z?
A: Their research must be thorough. In our case, we surveyed millions of data points and spoke to thousands one-on-one. That creates a robust, household-level picture that simple online surveys just won't yield. For example, in our most recent Millennial parents survey, we found five distinct groups that all act, believe and spend very differently from one another. If their Millennial research isn't revealing this type of diversity — their methodology needs to be adjusted.
Q: How will Gen-Z differ from Millennials?
A: Gen-Z will be even more digitally connected than Millennials. While the younger half of the Millennial generation grew up as digital natives, the older half of Millennials are digital-learned and that's a big difference within the group. All of Gen-Z will have grown up as digital natives. They have been born into it.
Another factor to consider is that Generation Z is completely redefining the American family. How they choose to live, shop, learn and start families is very different from past generations. While they are starting to settle down just like every generation before them, they are setting new trends never seen before — like unmarried partners, the rise of non-Caucasian majority and marrying later in life. These changes will affect how they connect with brands in immeasurable ways.