4: Snapshot of Millennials
The Millennials are the largest consumer group in terms of their numbers, and the second largest in terms of the amount of money they spend in the market - the latter largely because they are still young and have not achieved much earning power as yet.
As children of the Boomers, they grew up in a time of peace and privilege, "protected, praised, and programmed" by doting parents. They have been ruffled only recently by the terrorist attacks of 9/11 and the slump in the economy, neither of which they consider to have left an indelible mark on their character or attitudes.
Given that they are currently in their teens and early twenties, the Millennials are not well understood, but it is already becoming apparent that they express a strong sense of entitlement, wish to express their independence, but are still extremely dependent on parents to take care of things that most adults are expected to do for themselves and attached to their cliques and friends.
While many disregard them, it's best to get acquainted early, as they will be the dominant demographic in the future, and are already exercising their personal spending power, though it is generally spending money given to them by their parents, over whom they also have considerable influence.
Who Are the Millennials?
The term "Millennials" was first used in 1991, looking forward at the generation who would come of age after the turn of the second millennium. Various terms such as Generation Y, Generation Next, Echo Boomers, and Boomerang have been used, and there doesn't seem to be much consensus as to what they will eventually be called, though the members of the generation seem to prefer "Millennials" because the other options suggest they are merely a copy of previous generations.
This generation was born between 1980 and 2000 and now number about 85 million. They are considered to be the most educated, tech-friendly, and diverse generation, and there are already among them founders and CEOs of major technology companies.
They are also regarded as a generation of self-centered brats, indulged by their Boomer parents, and as a result are less hard-working and feel a greater sense of entitlement than other generations. They prefer to do pretty much as they please, and expect rewards to be granted to them automatically. There is some truth to this, though given their young age in the present day, it is unclear if this is likely to be a lasting characteristic.
Formative Experiences
Some of the watershed events of the Millennial generation are listed: the economic prosperity of the 1990's followed by the crash of the 2000's; the revolution in Internet, mobile technology, and social networking; political scandals such as the impeachment of Bill Clinton and the doubt of the 2000 election; the terrorist attacks of 9/11/01 and the precipitating era of panic, protectionism, and state surveillance.
In a more general sense, the Millennials are the children of soccer moms, pampered, praised, and programmed throughout their youth and even into adulthood. They have been given everything they ever wanted, and have done everything they were ever told.
As products of the information age, they are accustomed to a world that caters to them, even outside the household. From their youth, there were television and cable channels devoted entirely to their interest, with waves of advertising aimed right at them. They have always had a wide range of choices in things that don't matter (music, television, movies, Web sites) and very little voice in the things that do.
Presently, the Millennials are in their teens and twenties, but already seem to be stuck in a stage between adolescence and adulthood: they have been given a voice in many regards, but their lives have been chosen for them, such that very few Millennials have established themselves in the workplace, gotten married, started a family, or even moved away from home.
Other Characteristics
The author concedes, "generalizations about a group of 85 million people must be overbroad and will include many exceptions," but nonetheless, certain common traits have been identified by research:
One important characteristic is the Millennials are the most ethnically and racially diverse population, and have grown up in an era that values tolerance of diversity rather than expecting minorities to blend into the mainstream culture, and they are more acceptant of and less threatened by "foreign" ways.
Millennials are an educated generation, and will be the first in which the majority have at least some level of college education. While there has been some criticism of the declining quality of education, the Millennials still consider themselves to be smart and savvy consumers, and already have access to more product information than previous generations by virtue of the Internet, which they may on occasion seek to leverage.
The period of adolescence is extended for Millennials - almost half of them still live at home with their parents, and defer to their parents for decisions about their education, careers, and major purchases. While they are as old as thirty, only 25% have married and only 12% have any children, far fewer than in previous generations. It is likely most will be into their mid-thirties before they get married, buy a house, have kids, get serious about their careers, or otherwise behave as actual adults rather than older teenagers.
Among Millennials, there is no stigma attached to living in their parents' home into their adulthood: the notion of "having" things and "earning" them are entirely divorced. While Boomers took pride in owning the finer things in life, feeling that material success is a signal of a person's merit (even if they bought on credit), the Millennials see material possessions as an end in themselves. They feel the right to have things without earning them, or in some cases even paying for them, as evidenced by their propensity to steal them, even if they can afford to buy them (over 70% download pirated music and movies).
Another effect of their living at home is that they have low incomes, but considerably higher spending power, as their parents still cover the cost of necessities - even those who have left home are often heavily subsidized, with parents paying for rent, utilities, car payments, and the like, leaving their own income free for discretionary purchases. Fully 40% of adult Millennials receive money from their parents regularly.
Millennials are also fond of technology - and many feel that their consumption of technology products is a distinguishing feature of their generation. They devote a great deal of time to using computers and cell phones, and primarily engage in gaming and social networking online. Cell phones are ubiquitous - most Millennials have them, and they are always within reach (83% of Millennials sleep with their cell phones). For many, the largest bill they pay out of their own pocket is for their mobile phone. Many of them consider technology to be a necessity - that they would rather go without food than technology, and they would find it impossible to maintain relationships with friends and family without it. Fully three-quarters spend at least four hours a day using cell phones and computers.
Millennials inherited a sense of idealism from their Boomer parents, and express a high level of concern with the environment and social responsibility than other generations, which does not necessarily bear out in their behavior: they suggest that they will be more likely to buy brands from companies that "take a stand" and avoid those that are unethical, but their buying behavior does not reflect the same degree of devotion. They will express strong opinions on topics such as same-sex marriage or the legalization of marijuana, but few will make it to the polls.
Millennials want to be seen as individuals, who are independent in their actions and different from the rest, but they are very much influenced by peers and groups. They use technology to keep track of what is popular, and generally conform to the tastes and opinions of the majority. As such, their desire to be individuals generally expresses itself in trivial ways: even their choices in music, fashion, tattoos, and the other trappings of culture are marked by a desire to follow what others are doing.
Millennials are also accustomed to instant gratification, which is often attributed to being raised by doting parents. However, the external environment has also played a contributing factor: fast food, overnight shipping, and instant downloads. They get what they want, and they get it immediately. They claim to value their time, but given that they spend most of their time in leisure pursuits, what this means is that they do not want to wait.
They are also generally optimistic. Things for them have gone pretty well so far, and adults have praised and rewarded them for virtually everything they have ever done. As a result, they have a certainty that whatever they do will work out in their favor. They also have an inflated sense of their own capabilities - having been told they could succeed at anything they want, they are prone to shoot for the moon - without the expectation that it will take any effort to do so or that there is any chance of failure.
Because Millennials are so immersed in media, especially social media, they have the sense that a lot of people are making demands on their time - friends and companies seem to constantly want something of them. This feeds their self-importance, but also gives them the sense of being busy and stressed, though they are often busy at non-productive tasks: bouncing from school to soccer practice to video gaming, checking their text messages and Facebook pages on their mobile devices in-between.
In terms of their relationship with their parents, they have a sense of being more like friends than children, largely from the Boomer parents' desire to fit in with younger people and their reluctance to be authoritarian or administer discipline. As such, they do not defer to older people and do not like when others "talk down" to them.
Through moist of their lives, Millennials have been tended to by others, "pampered, protected, and programmed" by parents and other adults. They have come not only to accept this, but to expect it, and need someone to provide guidance to do even simple things.
Businesses that are interested in appealing to Millennials must somehow understand and make sense of this seeming paradox of a generation of people who are largely helpless and incapable of acting on their own, but feel that they should be treated with a high degree of respect and reverence by others.
Why Are the Millennials Important?
Millennials are also the largest generation in American history, whose numbers surpass even their Boomer parents. A big generation is a big market - and as the Boomers are moving out of the marketplace, the Millennials are moving in, and it's expected that businesses will embrace them as the majority market, and the prime target of marketers.
Millennials are the "youth market" and it is assumed that anything that catches on with youth will gain popularity with older consumers. Moreover, they are in presently in the stage of life where they will develop preferences to which they are expected to remain loyal through the remainder of their lives. They also wield considerable influence over another sizable demographic, the Boomers, who seek to follow youth trends as a method of "staying young" and rely on their children when purchasing technology. It's estimated that they influence about 5% of Boomer spending, in addition to the money they spend themselves.
As such, they also represent a significant market in terms of revenue. While most of them do not have a high personal income, many are subsidized by or entirely dependent upon their parents, and as such have greater spending power than their income would suggest, Also, since their parents provide the necessities, covering their housing and transportation costs, so the majority of their income is spent on discretionary purchases. They are also "spenders" rather than "savers," which follows the pattern of their Boomer parents - so while they earn less than Generation X, they spend much more.
Millennials are also an important sector of the electronics and technology marketplace. They spend a majority of their income on devices and software, and have considerable influence over the Boomer parents' purchase in this sector. But while they are fond of consuming technology, they do not have much understanding of it, and as such they demand products that are easy to use.
They also see technology, and virtually everything they own, as disposable. They will seek to replace their cell phone a few months later if a new version comes out, even if it offers no additional features, and even if the "old" one is still entirely serviceable. To some degree, this relates to many of the items they purchase, so they are more frequent buyers than any previous generation - but they do demonstrate loyalty to a given brand.
Millennials are also a mass market in the sense that they move in masses rather than making purchasing decisions as individuals. The yare fluent in the language of "social currency," closely monitoring the popularity of things via the Internet: the gross number of followers, fans, and hits is taken as evidence that something is valuable and merits attention. Generating "buzz" in the social media leads to sales.
While the notion of word-of-mouth has always been considered valuable to marketers, it is indispensable to the Millennials: because of their use of communications technology, word-of-mouth has a much broader reach and much greater speed than it once did. If your product is mentioned in a popular blog one day, thousands of orders will come in the next.