Marketing to Millennials For Dummies®
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Published simultaneously in Canada
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Library of Congress Control Number: 2017938428
ISBN 978-1-119-36904-2 (pbk); ISBN 978-1-119-36905-9 (ePub); 978-1-119-36902-8 (ePDF)
Millennials aren’t magical, elusive consumers, but marketers have had a great deal of difficulty figuring them out. Millennials are defined as individuals born between the years 1980 and 2000, and they make up the largest audience of consumers in the world. Although they’re defined by their age, Millennials are essentially prototypes for the modern consumer. Importantly, they’re poised to inherit the largest transfer of wealth ever recorded in human history!
A seismic shift has taken place regarding buying behavior, and it’s up to the marketers of the world to find new ways to reach customers. There is no one-size-fits-all model for reaching this coveted demographic. Every consumer is an individual and will uniquely respond to different brands, campaigns, and content.
Marketing to Millennials For Dummies is written to provide you with a framework to develop an effective Millennial marketing strategy. It’s filled with information that you can use to craft programs that are right for your brand.
I wrote this book to provide guidelines that marketers in virtually any field can leverage. Whether you’re working in a business-to-business setting selling raw materials to manufacturers or developing consumer-oriented communications strategies to sell discounted school supplies to an incoming class of mobile-oriented college freshmen, there’s something in this book that can help you.
The methods outlined in this book don’t preclude any level of marketing professional from participating. Whether you’re a seasoned veteran who is looking for new ways to spice up your brand’s communications strategies or a new marketer wondering how to tackle certain types of campaigns, you’ll be able to develop your strategies.
First and foremost, I assume that you’re either a business owner who handles your own company’s marketing, or you work in the marketing department of a brand, organization, government, or other entity. I assume that you’re already familiar with certain marketing strategies and tools. Therefore, you can use what I cover in this book to expand that knowledge. I also assume that
Throughout the margins in this book, you see little pictures that point out important information. The following list tells you what those icons mean:
In addition to what you’re reading right now, this product also comes with a free access-anywhere Cheat Sheet that gives you pointers on the topic of marketing to Millennials. To get this Cheat Sheet, simply go to www.dummies.com
and search for “Marketing to Millennials For Dummies Cheat Sheet” in the Search box.
You can read this book in any order. The chapters don’t have a linear structure. Cross-references throughout the book refer you to important concepts in other chapters.
If you’re wondering which chapter to start with, I strongly recommend Chapter 2. Chapter 2 is designed to provide you with an outline of how modern marketers see Millennials and how the view of Millennials needs to change to foster lasting relationships.
Part 2 focuses largely on strategies that take different media and practices into account to create a Millennial-facing program. Part 3 dives into some of the more specific markets and economies that Millennials occupy in significant numbers. Any chapter or section you choose to read, however, will provide you with the steps and information necessary to create effective communications strategies that cater to the increasingly relevant and influential Millennial audience.
Part 1
IN THIS PART …
Discover the importance of Millennials in terms of their economic impact and their influence.
Provide a clear definition of Millennials that stretches beyond simple age brackets.
Build out segmented, detailed audience pockets and analyze the behaviors of audience members.
Chapter 1
IN THIS CHAPTER
Understanding the Millennial market
Grasping the importance of relationships
Reaching Millennials where they are
Familiarizing oneself with the intricacies of Millennials is one of the most crucial steps a marketer can take. Today, personalization is the name of the game. The tailored experience that you want to create starts with getting to know the Millennial mind: how they operate and why they matter so much to your business.
In this chapter, you discover the short and long-term value Millennials bring to your organization. You see how they interact with brands across various media. You also find out ways you can connect with them.
Millennials are consumers, just like the generations that have come before them. However, circumstances, technology, and a changing global landscape have created a unique Millennial mindset.
Millennials are valuable because they now make up a major part of the global economy. Therefore, marketers need to focus on this group to develop effective, successful strategies that reach, engage, and convert Millennial consumers.
For our purposes, the term Millennial refers to consumers born between 1980 to 2000. The term Millennial can extend far beyond those age barriers, though, as I discuss in more detail in Chapter 2.
In 2015, Millennials edged out Baby Boomers as the largest demographic in the United States. Immediately, without any additional information about the demographic, they become important to your business. Volume alone makes them a highly coveted group. They’re all independent consumers, and the vast majority have a steady income. There are very few brands that wouldn’t be interested in marketing to the largest group of consumers in the country.
The Millennial cohort provides plenty of opportunities for marketers. As the largest demographic in the American economy, you ignore Millennials at your own peril. Millennials currently have tremendous buying power and over time will become wealthier.
Here are several reasons why the size of the market is a particularly important consideration:
Millennials have a tremendous influence over the national and global economy. The Fung Business Intelligence Centre (www.funggroup.com/eng/knowledge/research.php
) estimates that by 2020, Millennials will control 30 percent of retail spending in the United States, up from 13.5 percent in 2013. That 30 percent, according to Standard & Poor’s, accounts for about $1.4 trillion per year — and that number will undoubtedly grow.
Millennials are poised to receive the greatest transfer of wealth in economic history. Estimates from major American financial institutions, like Morgan Stanley, and research firms suggest that over the next several decades, Millennials will receive somewhere near $30 trillion from the generations that preceded them. That is a startling figure, and one that undoubtedly whets the appetite of marketers in any field.
To determine where that money is likely going to go, marketers should become aware of the spending habits of Millennials. This knowledge will help them build effectively targeted campaigns.
Goldman Sachs has provided key information about Millennials’ traits that you can see at www.goldmansachs.com/our-thinking/pages/millennials
.
Some of the factors that affect their behavior are as follows:
Ownership is not a priority. Major, long-term financial commitments are not as important to Millennials as they were to previous generations. In a world where the share economy and on-demand services have exploded, ownership is less important than access. The sharing economy (see Chapter 12) plays a major role in the Millennial consumer cycle.
The sharing economy, which is covered in detail in Chapter 12, is the market for shared goods and services, giving participants in the economy access over ownership. Millennials have gone through the stages of consumer maturation during a recession era, which has led to significant financial conservatism. Companies or products that fall into the share economy, such as Uber or Airbnb, allow Millennials to access the goods and services they need, when they need them, without requiring them to pay the price of ownership.
You need to be aware of certain characteristics to take advantage of Millennials’ communications habits:
The buying cycle is not linear. The buying cycle has an endless number of touchpoints. You have control over some of them while the audience creates others. The key is to note where your prospects connect with your brand so that you can plan to be there. (Chapter 9 covers a complete omni-channel marketing strategy.)
Touchpoints refer to the various interactions that a consumer has with a brand throughout the buying cycle. Touchpoints can vary by medium, creative design, and content type, such as images or video. In traditional media, such as television or print, far fewer touchpoints are in the buyer’s journey. When you consider new media, like social networks, mobile, and other digital platforms, the number of touchpoints can skyrocket over the course of the buyer journey.
The connectedness of the Millennial market may require you to create more complex, interwoven communications strategies than you’re used to. It also means that you have a new marketing tool at your disposal — the consumers themselves. Taking advantage of influencers and utilizing your brand advocates is a powerful strategy.
Influencers are consumers who have amassed large, loyal followings on various social platforms. High star power actors are one form of influencer, but for Millennials, those that hold the most power are consumers who have built organic followings by sharing great content. An example of a modern Millennial influencer would be a consumer who has built a YouTube following by sharing reviews of a particular line of products. The influencer gains trust above the brand because of the implicit honesty and integrity of these reviews.
Consumers aren’t as interested in traditional advertising messages as they once were. Of course, paid campaigns still serve a major role in the consumer buying cycle, but identifying influencers within your existing audience is more important.
The following sections offer a few helpful tactics for finding influencers.
Loyalty can’t be bought, but it can be encouraged. Establishing a loyalty program is an excellent way to
Because relationships are crucial to the survival of your brand, a loyalty program will help build those relationships. Hopefully, those relationships will lead to the cultivation of brand advocates. Those advocates can then help build your brand by introducing it to new circles of consumers.
Customer lifetime value is defined as the net profit generated by your brand based on the entire relationship of transactions with a customer.
The goal of any brand should be to turn prospects into customers and customers into brand defenders. A brand defender is a customer who not only advocates on behalf of your brand and acts as a pseudo-sales agent, but also defends your brand in times of crisis.
One of the best examples of brand defenders in action was evident during Apple’s notorious Bendgate affair when the newly released iPhone 6 phones were bending in owners’ back pockets. Despite a clear issue with the product, Apple’s brand defenders rushed to their side. They insisted that the root of the problem was consumer misuse rather than a product defect. It’s rare that a brand reaches this level of advocacy. But, if you can cultivate brand defenders by identifying and nurturing your existing brand advocates, your long-run success is assured.
Employees are consumers, too, and marketers often forget about the power of activating their Millennial employees. They relay positive experiences with your products and share them with their social circles. This word-of-mouth marketing helps you take advantage of the massive social reach existing right within your organization.
Encouraging and perhaps incentivizing employees to share content is a powerful way to build your presence, foster brand awareness, and prompt adoption from a new user base.
It’s all too easy to brush off criticism and focus on new customer acquisition. But communicating with detractors shows that you care.
Often, when customers complain, their goal is to be heard rather than to remedy a bad situation. Attempting to improve these transactions goes a long way toward creating new brand advocates and defenders. In addition, addressing an issue quickly and effectively can prevent it from spiraling out of control and becoming a costly mistake.
Millennials see relationships as a significant part of the buying process. The irony of this is that this demographic is more price sensitive than its predecessors, yet Millennial consumers are willing to pay a slightly higher price if they have a relationship with the higher-priced brand. This mindset isn’t one that marketers are familiar with. However, marketing to Millennials doesn’t require a completely new paradigm. It simply requires marketers to dig much deeper into the mind of the Millennial consumer.
Brand familiarity is not the driving force behind a Millennial consumer’s decision to purchase; quality matters considerably more than the brand name or logo. Reaching Millennials requires careful planning.
Here are several ways to nurture a relationship with a Millennial consumer:
Billions of interactions and engagements take place online every single day. Joining a conversation in progress is always going to be much easier than trying to create your own.
Millennials are engaged on various platforms with content, brands, and each other. Your responsibility as a marketer is to find new and creative ways to become a part of those exchanges. To reach these individuals, you need to understand
It may seem like the only way for brands to reach Millennial consumers is via social media. But the reality is that Millennials use a broad number of communication platforms, including traditional media. Familiarizing yourself with these media is going to play a crucial role in communicating with your audience. (Chapter 5 covers the use of traditional media.)
Traditional means of advertising, such as television and print, were once restricted to brands willing to spend the big bucks. Now new methods that meld the digital world with the offline world allow virtually any brand to connect with Millennial consumers. (Chapter 6 covers multiple kinds of new media and details how marketers can take advantage of both organic and paid initiatives to communicate with and convert Millennials into long-run customers.)
Organic initiatives and strategies are those that don’t rely on paid advertising to reach a specific audience segment. Organic engagement is powerful and a key component to the success of a marketing program. However, building these kinds of audiences takes significantly longer. A well-thought-out mix of the two — paid and organic — will be useful in helping you build out your brand on both traditional and new media.
While Millennials aren’t a monolithic group, many Millennials have certain traits in common:
Sharing means a lot more than it used to, thanks in large part to new media like Facebook, Twitter, and Airbnb. You can look at the concept of sharing from two perspectives.
First is the content and information approach. Millennials share more with each other and with brands than any generation that came before them. Unlike Baby Boomers, Millennials have indicated that they are willing to share personal information with brands. This willingness to share has led to the explosion of data-gathering methods, such as social sign-in. Social sign-in allows users to sign in with a single click via Google or Facebook.
Thanks to social sign-in, your brand can collect a significant amount of data without having to directly questioning your audience. The desire for simplicity and convenience on the part of the Millennial consumers means that they’re likely to use this option. It’s less cumbersome than creating stand-alone profiles for each platform and limiting the information they share with brands. Data is crucial to the creation and improvement of your Millennial marketing strategy. The willingness of Millennials to share via social sign-in means that those processes are made significantly easier.
The second concept of sharing relates to the rise of the sharing economy (covered in detail in Chapter 12). Millennial consumers agree that access to goods and services is more important than ownership. Brands like Airbnb (https://airbnb.com
) and Uber (https://uber.com
) recognized this fact and built multibillion-dollar businesses to capitalize on it. The priorities and measurements of success have changed for Millennials. The sharing economy has facilitated this transformation. (Chapter 12 covers the sharing economy.)
Impulsivity and ownership are no longer the names of the game when it comes to making purchasing decisions. Millennials have access to a wealth of information that can help them make informed, educated, and trusted decisions, and they don’t hurry the process.
The Edelman Trust Barometer showed that industry and academic experts and peers rank above brands as trusted advisors. Review sites like Yelp!, shown in Figure 1-1, make peer reviews readily available for virtually any type of product or service. Millennials use these kinds of sites when making a buying decision.
FIGURE 1-1: Yelp! allows consumers to provide reviews.
As the availability of trustworthy, verifiable information, such as reviews, has increased, their impact has been noticeable across all markets. A 2015 study by Forbes found that only about 1 percent of Millennial consumers would trust a brand more as a result of traditional advertising. Roughly, a third of Millennials review blogs and review sites before making a purchase. Authenticity is what matters most to these prospects, and that outweighs even the quality of content.
This trend has leveled the playing field for smaller brands. Of course, big budgets open doors and opportunities not available to smaller companies, but now they have the opportunity to compete for the same business as larger organizations.
Chapter 2
IN THIS CHAPTER
Defining the Millennial consumer
Recognizing common errors marketers make with Millennials
Understanding the Millennial mindset and its implications
Building an effective strategy for Millennial consumers begins with a clear understanding of their unique characteristics. Some marketers miss the basics. Millennials, like any generation, are defined as a group of consumers that fall into a certain age bracket. But, in some cases marketing to Millennials requires you to look beyond age. For this reason, you need to develop a deep understanding of this market so that you don’t misunderstand its complex nature.
In this chapter, you start thinking about Millennials as prototypes for the next generation of consumers. They’re not simply soon-to-be-wealthy 20-somethings that are difficult to reach. They represent a seismic shift in the world of marketing.