Millennials Are Evolving; Are You Keeping Up?

The Recession Has Changed Them as Consumers, But They're as Valuable as Ever

by Megan Meagher 
Published: July 01, 2009 Link to: http://adage.com/cmostrategy/article?article_id=137701

Megan Meagher

Marketers love Gen Yers. They've got roughly $200 billion in disposable income, and they aren't afraid to spend it on clothes, designer sneakers, alcohol, fast food, cellphones and video games. I'm familiar with the lackadaisical spending habits of Gen Yers, because I am one, and until last fall, I, too, splurged on things such as a Wii and an iPhone.

But I'm a changed person, thanks to this recession. I eat more meals at home and actually pay attention to the price of groceries. Living on my own for the first time, I find myself buying and using more household products, from dishwasher soap to stain remover.

As a result, I'm newly receptive to advertising in those product categories. But what surprises me is how few marketers -- outside of clothes, shoe, food-and-beverage and entertainment marketers -- actually pursue my age group. I wonder why that is, when much of what I've learned about brand building in my work in strategic planning suggests that marketers that reach out to Gen Y may find that the payoff lasts decades. Consumers settle into brand choices in their 20s, according to one report, and those preferences don't change much into their 30s and beyond. And get this: Brand loyalty increases with age -- 37% of 18- to 29-year-olds buy one favorite brand of mayonnaise, for instance, vs. 55% of those 30-plus.

Kraft, PNC Bank reach out
To be sure, some brand managers have used these tough economic times to reach beyond their typical target audiences, particularly because the habits of consumers like me are changing.

Just recently, Kraft Foods launched a campaign for its Miracle Whip spread that does the unthinkable and looks beyond moms as the target. The goal was to simply remind young consumers about Miracle Whip, a sandwich spread and dressing they most likely grew up with but may have abandoned after childhood.

Along with a traditional media campaign and Facebook and Twitter pages, Kraft created Zingr, a software application that allows users to "zing," or comment on, content on the web. The tool is actually useful and savvy in how it taps into the way Gen Y consumes information. Zingr makes it easy for Gen Yers to share what they love to share the most: cool content and their opinions. Plus, Miracle Whip scores points for not overwhelming users with blatant product branding.

Another brand that does an exceptional job of wooing Gen Y is PNC Bank. Its efforts are particularly noteworthy in a category chock-full of generally uninteresting marketing. A friend of mine who lives in Philadelphia banks with PNC and claims that its Virtual Wallet has "changed the way I save." News stories report that the Virtual Wallet was developed in response to research results that revealed that Gen Yers view bank websites as being un-user-friendly. Gen Yers also admitted that they don't know how to manage money.

The tool allows users to track spending, schedule bill payments and set aside money for specific purchases. For example, my friend is saving money to start an IRA and to buy a Diane von Furstenberg dress. With Virtual Wallet, she turned what might have been a guilt-inducing splurge into a responsible and (more) rational purchase. As of November, according to reports, 130 new customers per day were signing up for the account. Its success illustrates that providing something genuinely helpful online is one of the best ways to earn the loyalty of my internet-addicted generation.

Commitment to doing good
Another approach marketers might consider when trying to gain Gen Yers' loyalty is to prove a brand's commitment to the community. Involvement and doing good particularly resonates with my age group. A 2006 study by Cone and AMP Insights found that 61% of 13- to 25-year-olds feel personally responsible for making a difference in the world, and 83% will trust a company more if it is socially or environmentally responsible.

A recent campaign from the online travel community TripAdvisor used social media to ask travelers how to distribute $1 million among five travel-related nonprofit organizations. More than 1 million votes were cast via mobile phones and online, and Doctors Without Borders received the greatest contribution, of $392,000. TripAdvisor established itself as a socially responsible brand without putting the onus on consumers to donate, and as a result gained credibility as a brand that gives back.

In a few years my generation will be the moms and dads of the world, the major household buyers. Within the next decade, we'll be generating $2.77 trillion dollars per year. It's essential for brands to grab us now and reach out in ways we find meaningful.

One possibility: opt-in programs to send coupons to our mobile phones (72% of those under 34 have printed or downloaded a coupon). Or try giving us a useful freebie, such as booklet of quick-and-easy recipes for one or a guide to removing stains (of the wine and ball-point-pen variety). Or even try something as simple as setting up a Facebook page about the affordability of renter's insurance and its benefits, then invite users to share horror stories of ruined possessions. Just make our lives easier, teach us something new and let us know that our dollars are just as valuable as those of the mom next door.

Bad News Could Be the Best Thing for Millennials

Viewpoint: Jonathan Lewis Hopes Economic Hardship Knocks a Little Sense Into His Generation

by Jonathan Lewis 
Published: July 01, 2009

Jonathan Lewis

I hope you enjoyed it while it lasted, because the excess that fueled Generation Y and the current economic meltdown is fading fast -- along with, I hope, the most negative characteristics of our generation. Whether you've just graduated into the worst job market in decades, were recently laid off or shudder every time your manager calls an impromptu meeting, one thing is true: Like it or not, you and I are going to face some very difficult personal and professional decisions.

Do you remember when, not long ago, volumes of articles, books and even conferences were springing up attempting to teach the "old-school" business community how to best manage this upcoming and unique generation entering the work force? Authors used terms such as "entitled" and "narcissistic" to describe what they called the most digitally connected and self-focused generation to walk the earth. Ample advice was given on how to best manage our fragile self-esteem, fickle career decisions and, as freelance writer Carol Forsloff put it, resistance "to anything that doesn't involve praise and rewards." The only positive thing said about us was our intimate knowledge of technology, and even that is being eroded by the boomers' rush to embrace it (my mother-in-law just friended me on Facebook).

I don't know about you, but having to write the above paragraph about myself and my generation has me more than a little embarrassed. That's why I hope the current economy and accompanying hardships will do more than scare us. I hope they will knock a little sense into us too.

We're not the first generation to face tough times. If we can heed some of the following age-old advice and learn a thing or two from folks who have gone through this before, not only will we have a better chance to thrive through this hardship, we might just disprove a few stereotypes along the way.

1. Get over yourself
The only thing self-esteem gave us was a dangerous dose of entitlement. If we're going to come out of this downturn alive, we're going to have to remember one thing: No one owes us anything. We earn what we get, and that "earn" part involves time and effort. Our employers and interviewers don't care if their demands interfere with our lunch appointment or 8 a.m. workout. And frankly, we can't afford to have the world revolve around us anymore. We must take a bite of humble pie, prove our value and get over our collective selves.

2. Remember what your mama told you
There's a reason Robert Fulghum wrote "All I Really Need to Know I Learned in Kindergarten." He understood the value of mastering the basics. And chances are your mom did too. She sure didn't teach you to stroll in to work at 9:30 a.m. or take that extra-long lunch. And you can just imagine what she would say if she saw the apparel you deemed appropriate for work this morning. No matter what happens in the world around us, the fundamentals never change. Be professional. Work hard. Honor your word. Do unto others ... I mean, seriously, I know our generation doesn't emerge from adolescence until we're 25, but c'mon. Grow up.

3. Get off your butt and innovate
It wasn't buckets of cash or bailouts that pulled our grandparents out of the Great Depression. It was the hard work of a generation, a bloody world war and some of the most groundbreaking innovation the world has ever seen. Economies don't recover when generations sit on their hands hoping someone else will fix their problems.

According to author and speaker Alexandra Levit, Holly Hoffman took this to heart when she saw layoffs looming at the national newspaper corporation she worked for in Texas. Instead of lying low in team meetings, she decided to take things into her own hands. Hoffman explained, "As the bottom person, I knew that I would be eliminated unless I could directly tie my position to profits. So instead of just using the sales program I was given, I interviewed our field reps to see how we could improve it." Levit reported that "Ms. Hoffman's revamped sales program was expanded to three additional newspapers, earning her a promotion even as many of her friends were being laid off."

If we are going to do more than just survive in this environment, we must step up to the plate, put our green pencils to recycled paper and innovate our way to success.

4. Things will never be the same
Our nation's rush to borrow its way out of debt has more than a few economists worried. And you can bet your Euros it's our generation that will pay for this mess. The era of "Bad credit? No problem" is over, and the luxuries we've taken for granted are slipping away. We're inheriting incomprehensible debt, unsustainable social programs and leaders who think the way to fix the problem is to keep doing more of the same thing. You and I have to come to terms with the knowledge that more trouble is heading our way, and hiding from it won't make it disappear. Like any major challenge, you can't deal with the problem until you admit that you have one.

5. Berlin or bust
Our grandparents faced a similar situation during their generation's greatest challenge. The Great Depression and WWII fostered hardships we can't even imagine -- yet. It was the excesses of their parents' generation, embodied by the Roaring Twenties, that fueled their hardships. Their response: Stand firm, work hard and help a neighbor.

And now we're faced with a similar choice. Our grandparents could have thrown in the towel and resigned themselves to their poor lot in life, but they didn't. They rose to the challenge and earned their place in history as the Greatest Generation. So what will our response be? Will we wait for someone to swoop in and fix our problems, or will we build off our strengths, harness the incredible tools at our disposal and pull ourselves up by our Nike shoestrings? With a little old-school work ethic and innovation, we can take our new-school technology and show our critics, and the world, what our generation is really made of.

It's yet to be seen if this worst-case scenario will end up being the best thing to happen to our generation. But one thing is certain: The choice is ours.

Motorola: Young Adults Influence Key Tech Decisions

Additionally, 70% say their expectations are far greater than their parents' when it comes to better media experiences and mobile broadband access.

Other research showed 85% of these young viewers have cable or satellite television service, and that 42% want a DVR to go along with them. Thirty-five percent of those with HDTV want to have more HD programming.

As far as newer technologies, a strong majority, 84%, want to get TV programs and movies. About the same number want to able to pause a TV program in one room and resume play in another room in the home. These mighty tech consumer also want to be able to download TV programs from a DVR to mobile players.

Says Eduardo Conrado, corporate vice president, global marketing and communications, Motorola, Inc, in a press release: "This study provides a clear barometer that shows the changes in demand and growth opportunities as Millennials continue to increase their buying power."