UPDATE: Forbes, The Recession Generation: How Millennials Are Changing Money Management Forever
Apparently everyone is battling to win the millennials’ spending power. If you aren’t, maybe you should be.
Who are the “millennials?” In his Times Magazine article Millennials: The Next Greatest Generation?, Joel Stein explains that they are the “80 million Americans born roughly between 1980 and 2000.” (Another article reported that they are 90 million strong.) They are also commonly referred to as the Millennial Generation, Generation Y, Generation We, Global Generation, Generation Next and the Next Generation, and Echo Boomers. This translates into the oldest millennials being about 35 years old.
Now who are they really? In his article, Joel noted that “[t]he National Institutes of Health found that for people in their 20s, Narcissistic Personality Disorder is three times as high than the generation that’s 65 or older… Millennials received so many participation trophies growing up that 40 percent of them think they should be promoted every two years – regardless of performance.” However, he argues that “rather than being inherently self-centered or overconfident, millennials are just adapting quickly to a world undergoing rapid technological change. They’re optimistic, they’re confident and they’re pragmatic at a time when it can be difficult just to get by.”
Recognizing that there are distinct differences between millennials and prior generations, the Sacramento Business Journal recently published an article titled Top 5 millennial trends of 2014. Because “millennials have more purchasing power than ever before,” — one article reported that millennials are “expected to spend more than $200 billion annually starting in 2017 and $10 trillion in their lifetimes” — marketing to them needs to be strategic and innovative.
The Sacramento Business Journal identified the top five millennial trends as follows:
1. Social media paradigm shift — “… Instead of being afraid to share information, users are now focusing on what benefits come from sharing personal information online.”
2. Social ads are replacing banner ads — “…Traditional online banner ads are mostly ignored by social media users and are only clicked 0.2 percent of the time they are seen. Social ads are smaller and more suited for smartphones than traditional banner ads, and they are preferred by Generation Y.”
3. Pictures speak louder than words — “…millennials value brands that allow them to express themselves in unique ways. Photo sharing is a way millennials can connect with others through creative expression.”
4. Say goodbye to luxury branding — “…These millennials do not seek out products that show off their high status. Instead they are driven by experiences and opportunities to create memories that they can share with friends…Brands like Nike and Honda are now considered luxury brands, and are generally favored by the majority of millennials.”
5. More mobile — “…two out every five millennials say they would feel anxious without their smartphones. It is imperative that every platform be optimized for mobile use.”
How will you win the battle for their spending power?
Additional Sources: CNN Money, How young tech millionaires invest (Feb 27, 2014); Governance Studies at Brookings, How Millennials Could Upend Wall Street and Corporate America, Morley Winograd and Dr. Michael Hais (May 2014); Sacramento Business Journal, 4 ways Millennials will change business and politics (May 28, 2014); The Growing Home-buying Power of Millennials (Apr. 21, 2014); Trends 2014: Buying Power Shifts To Millennials And Female Home Owners (Aug. 27, 2013); Millennials: The Next Greatest Generation? (May 13, 2013); Sacramento Business Journal, Top 5 millennial trends of 2014 (Apr. 7, 2014) and Who will win the battle for the millennial grocery shopper? (Apr. 14, 2014); U.S. Chamber of Commerce Foundation, The Millennial Generation (Nov. 14, 2012)