Marketing can never predict the actions of an individual but a traditional marketing practice is to segment markets into groups whose actions can be predicted. These segments are used to develop messaging and select channels for outreach. Generational segments are a well-established segmentation because it works. Like any segment it does not apply to every member of the segment but it does generally apply to the group. Millennials are one of these segments that are rapidly becoming the lead group in the market.
Most sources define the Millennial Generation as those born between 1980 and 2004. Some start it at 1982 or end at 2000 but that is splitting hairs. Right now this generation is in their 20’s and 30’s so it is their time to really start taking larger and larger decision roles. As they age, their incomes will continue to increase and their leadership in the world will grow as my generation retires and phases out of the leadership roles. One observation I have of this generation is that the future is very bright and so are its members.
If you want to market to the Millennials you start by getting to understand their perception of value and decision process. Like any other marketing – failure to understand and relate to the audience is a fatal flaw and this is true for all audiences, including Millennials.
Understanding the Millennial Audience
I am a Baby Boomer so in order to market to Millennials I have to start by understanding the audience. While it would be nice to be a part of the audience; that is not a requirement. What is a requirement is an open mind and deep listening to members of the audience. If you do not naturally have this then you have to find it and some common tools would be the use of focus groups or engagements in shareable experiences. In this context a shareable experience is one where you operate in a peer setting with a group of Millennials such as a Startup Weekend.
Both my sons and all of the staff at SMS are millennials so I have lots of opportunity to observe and listen daily. Millennials grew up with a subset of my life experiences. What I mean by this is that my life experience started in 1953 and theirs started in 1980 so we share life experiences from about 1990 to present. They are now taking the world over, as they should. The difference is that Millennials have 40 years in front of them and I have 40 years behind me. Their life experiences cause them to think differently. This is a challenge in the marketing world because they are now a critical market mover. Any business that fails to understand this generation will not be around very long.
Digital Natives, Shared Economy, Social Media
Let’s look at a few things that make this generation different. They are the first generation of digital natives meaning that they grew up with computers and the internet. They have embraced the shared economy that came with that technology in a way that other generations have struggled with. Social media is a by-product of these life experiences and it changed marketing from a broadcast to a two-way conversation model. The other major shift was toward crowd thinking and a great example of that is Kick Starter, a crowd funded idea launcher. Millennials accept group thinking even if they are very independent thinkers.
Over the last few years I have worked with people in this generation as a by-product of my involvement in Startup Weekends. In these events teams work on launching a business in a 54 hour weekend and this is a product of the Millennials. They see the world differently than my generation who withheld their ideas and developed in secret. In a startup weekend you start by telling the world your idea and getting validation by building a team that loves the idea. In my generation if you thought you had a good idea you went underground, worked on the patent and only after it was protected did you start to talk to others.
I have now attended six startup weekends so I have over 300 hours working with different groups almost all of which were Millennials. There have been a few Boomers and Gen X but it is a very, very short list. As a result of this I have seen how they think, innovate, and plan under stress. I have to tell you that I am impressed not only with the methods but also the results. In these Startup Weekends they take on impossible tasks and in most cases they move the idea forward. The rapid fire innovate, code, test, iterate cycle is a wonder to watch and it comes from their way of working together. This creates project management nightmares but you cannot argue with the overall results. Google uses this model and it results in fast progress but it also leads to some spectacular failures. Millennials however are not concerned with that because they just move to the next project.
Millennials in a Work Environment
Millennials have more group think than my generation and they tend to want to work more in peer to peer networks than the Boomer generation of bosses and workers. You have to be careful of observations based on internal staff because like everyone Millennials will respond differently in a work environment. They expect to have less difference between individuals and they want the team to win – not the person. Group thinking allows early input without the idea being perfect. In that model you put the idea out there and sell it to the crowd as part of the product validation. They want to see the opinions of their peers because they are skeptical of pre-packaged fancy marketing – they want to be educated not sold to.
Millennials oftentimes will value time over money so businesses may have to rethink the save money message and consider the value of time. Millennials have a much better balance between work and personal time and they blend these more than my generation. Millennials are the first generation to deal with the always-on technology and they move in and out of work mode. As an employer that is burdened with outdated employment laws it is clear that this generation’s work habits will cause great change in labor laws. This also means that time over money messaging will be valued greater on the time side.
Millennials look at a career as a series of projects where they work really hard then move on to the next project. In my generation you got a job, worked there for 30 years, retired and got a gold watch. This to some degree explains companies like Google that operate in this same model. In marketing, this is great because marketing wears out over time and needs to be replaced with fresh ideas. Millennials need to be marketed with value in the here and now and not the future value.
Millennials are more likely to be moved to action if they can do something without having to end up owning something at the end. One by-product of the Millennials is the shared economy and included in this are concepts like Uber, AirBnB, and many others. Every Startup Weekend I have attended has had several “me-too” ideas that fall into the shared economy category. The shared economy changes the rules and values for businesses. A great example of this is cars – in my generation we wanted to own the cool car and it was a big thing to us. Millennials often would rather have a ride at the time they need it and have the money to have fun when they arrive. Look for rental models in many areas to increase in popularity as this generation becomes a bigger driver of business models.
As a marketing agency we must understand and appreciate the demands of this audience. The best advice I can give anyone addressing generational marketing is to make sure that you have a diverse group with active voices from each generation that is important to your business. Lack of these voices in the conversation is a fatal flaw in any marketing strategy.
As a Baby Boomer I can never fully understand Millennials but I can appreciate their perception of value and decision process.