Marketing to Millennials
My 21-year-old son is part of the Millennial generation, those born between 1981 and 2000. As a Baby Boomer, I don’t always understand the likes and dislikes of my son’s generation. But, with his birthday coming up soon and hoping to find a gift he would like, I did a little research (writers like research!) and discovered a lot about how Millennials think and why they make the purchases they do. You might not have Millennials in your family, but they do visit your store, and what I learned could help you market to this influential segment of young consumers.
Millennials are 105 million strong in the U.S. They represent between 25 and 30 percent of the population, making their generation larger than the two generations preceding them—Baby Boomers and Generation X. Their direct buying power is in excess of $200 billion a year. Their indirect purchasing muscle, through their sway over their Baby Boomer parents (like me!), bumps that figure up to more than $500 billion a year. And, since their buying power will likely increase as they age, Millennials represent an enormous market for retailers.
Millennials are not necessarily homogeneous, but when they make purchases, they often look to what their peers are doing. Because they look for affirmation from their friends, Millennials are more apt to tell their friends and people they meet about companies and products they like—and don’t like. The Internet makes this tendency easy. On product-review websites and on social media, they can readily express their opinions about products and services to their circle of friends, friends that can number into the hundreds and even thousands!
Who are the Millennials?
I watched my son grow up with computers, including games, learning programs, and email, but I didn’t realize how much the digital age had become part of his generation until I started my research.
When computers made their way into everyday life and music became digitized in the 1980s, the first Millennials weren’t yet out of elementary school. Growing up with all the new technology, it’s no wonder they now are totally hooked into digital devices and spend large amounts of time online. In 2011, Forrester Research did a study concluding 91 percent of Millennials are regular Internet users, freely accessing it through their smartphones, tablets, and laptops. Overall, they average 25 hours per week online—more than they spend watching television.
“Young people today are obsessed with their phones and mobile devices,” says BuzzFeed CEO Jonah Peretti. Cell phones have become an integral part of Millennials’ lives: they take them almost everywhere they go, including sleeping with them under their pillow at night! According to Emarketer.com, more than 90 percent of Millennials have a mobile device, and more than half have a smartphone.
Digitally inclined and mobile, Millennials like to make informed decisions. In part due to easy access to their online social network, they often seek information and endorsements from friends, family, and experts when deciding what to buy. So much so that 70 percent of Millennials say they are more excited about things they’ve bought when their friends agree with them.
Like all generations, Millennials have a desire to be appreciated and acknowledged. More than other generations, though, they seem to prefer businesses, brands, and products they feel empower them and boost their self-esteem.
Buying habits of Millennials
Because of their natural inclination toward gathering information digitally, Millennials get most of their information about companies and products online. Social networking websites are often where they discuss things that interest them, including their latest purchase and how it affected their life.
The 25-plus hours Millennials spend every week online means they are surfing the Internet or on the phone tweeting and texting friends for much of their purchasing information. The most effective way to attract more Millennial customers is by expanding your marketing channels beyond just television commercials and newspaper ads.
To reach Millennials, retailers need to become very comfortable with digital advertising. You’re most likely to find Millennials online. Unless you get on board with Internet and email advertising, you are restricting your market share of Millennial purchases. Major media sites such as Facebook and Google are fine, but Millennials are quick to adopt new sites, like BuzzFeed, Thrillist, YourTango, JustJared, Jezebel, and HelloGiggles, among others.
As a retailer, it’s important to understand Millennials use the Internet and social media sites the way Baby Boomers use television—as a primary source for advertising and information regarding products. Unlike television, though, social media is two-way communication, where people can casually discuss their purchases and how the products are working out. Sometimes this casual information goes viral, suddenly creating a buzz on the Internet that can be a retailing dream … or nightmare. By now we’ve all heard both horrifying and heart-warming stories that have gone viral on the Internet and social media sites. Understanding the power of the Internet is vitally important in your retail marketing efforts.
Keep up and keep it real
Millennials revel in the idea of buying into the latest technological development. This includes the latest smartphone, tablet, computer game, app, music device, and other leading-edge electronic equipment. They also are very savvy about what’s hot and what’s not, and not just in electronic gadgets. They’re the first ones to pick up on the newest styles in clothing and jewelry, and the first ones to try the latest hairstyles and beauty products. They stay abreast of the latest trends in the marketplace, which means retailers must stay current with these trends, too, to be successful marketing products to this age group.
Authenticity is a big key when marketing to Millennials. False messages from companies, irrelevant information, brands that don’t live up to their hype, and deceptive business practices are all deal breakers with Millennials. The most successful marketing revolves around telling the story that communicates what a product has to offer and the benefit of buying and owning it.
Millennials prefer to do business with retailers who give back to the community in some way. They want to make a difference and buy products that give them a specific avenue for giving back. Simply telling them the company gives back to the community isn’t enough. They like to be more personally involved in the experience of giving back.
An example for Millennials in their mid-20s and older is ONEHOPE, a partnership with winemaker Robert Mondavi Jr. Under the agreement, half the profits from every bottle of ONEHOPE wine sold is donated to partner charities that support such causes as fighting breast cancer and ending childhood hunger. When it comes down to choosing between two products, one that makes a difference and one that doesn’t, Millennials will almost always choose the product that is trying to make a difference for good in the world.
Millennials don’t want to just purchase a product, they want to participate and be a part of that product and the company selling it. They are not driven by corporate values, but rather by individual values. They want to be listened to and truly heard. They are, in a way, looking for an emotional connection that ultimately leads to loyalty and trust with particular brands and retailers. They want a marketing message that engages and involves them in the purchasing process. In addition, they demand positive customer service policies and practices.
Engage (and create return customers)
Through the years, I have watched my son evolve in his buying habits. From New Balance tennis shoes to a Toyota hybrid and everything in between, he has shown an inclination to engage wholeheartedly with the products he chooses, and in a sense, they become part of his identity. As a researcher, this Millennial phenomenon intrigued me and gave me a better understanding of his generation’s preferences and buying habits. As a mom, it brought me one step closer to finding the perfect gift for my son’s birthday.
Millennials have become more involved than previous generations with marketing and the products they buy, through texting and online reviews and the power of the Internet to spread opinions at warp speed. They expect to participate in the action and advocate—or not—on behalf of the products and services they buy, their customer journey and experience, and any marketing that moves beyond social media.
Shareworthiness is an online term that denotes whether an item or product is worth sharing with others. The higher the shareworthiness, the larger the market it reaches. Common ways to increase your shareworthiness include purpose and disruption. You need to be tech-centric and quirky—even a bit cheeky. Is your store or product causing people to stop what they’re doing, pay attention, and engage with your business and/or product? These are sure-fire ways you can entice Millennials to visit your website and shop at your store.
Once you get Millennials in the door, you need to create a shopping experience that meets their needs. Millennials are keen on the environment and being green, health and sports, and making a difference in the world. In many ways, they are the ideal candidates for buying transformational products for body, mind, and spirit.
The idea is to be straightforward when you tell them about the products in your store. Give them the information about an item without distorting what it is and what it can do. Millennials desire good, informative content that speaks to their interests. They do their research and often check with their peer group and contacts on social media. They want content marketing, which, unlike traditional marketing and advertising, isn’t so invasive, while giving the consumers the information they need to make purchases.
As retailers, you need to be aware and up-to-speed to relate to your current Millennial customers and attract more. They represent a huge market share of the buying public. Ignore them at your peril! Make an effort to get them to participate in their buying experience. They crave this participation and interaction. Create excitement in your store and on your website and start programs that give something of value back to your community or cause. Initiate both store and Internet events in order to draw more attention to your store and attract more Millennial customers.
A happy ending
After hashing over the information I learned about Millennials, I wound up buying my son a new smartphone and a crystal pendant with a curb chain. He was thrilled with his presents … and immediately texted his friends to share what he received!
6 Factors Influencing Millennial purchasing decisions:
- Technologically cutting-edge products
- Brands that live up to their hype
- Companies that give back to the community
- Recommendations from friends on social media sites
- Companies and products that provide participation
- Brand new fads stimulated by popular culture
If you want to increase Millennial business, you need to be even more visible on the internet:
- Have an up-to-date business website
- Join and utilize social media sites
- Create a blog and post weekly
- Interact with online chats, conferences, and webinars
- Link to other websites that can draw business to you
- Advertise on websites catering to Millennials
First published in Vol. 27 No. 5 of Retailing Insight. © 2013 Continuity Publishing Inc. All rights reserved.