Money and women are the most sought after and the least known about of any two things we have.—Will Rogers
By 2017, Millennials will have more buying power than any other generation in the industrialization era
Everyone is after the Millennials and their money. As a group, Millennials have replaced the Baby Boomer generation as being the most attractive to advertisers. They are more likely to have expendable income and both their earning and buying power is just beginning to grow. Brands that lock in Millennials as repeat customers now are likely to enjoy a long purchasing relationship in the future.
The challenge is that Millennials have a very different outlook on the world than did my generation when we were their age. Therefore, they don’t respond to the same form of advertising and marketing campaigns that have worked before. Ad agencies get this because, no big surprise here, a large portion of their creative staffs are Millennials. Convincing their clients of the need to change, however, is not always easy. Some get it, some don’t.
Among those who seem to understand the need to market differently to Millennials is MillerCoors. Sure, it’s no big surprise that Millennials like beer; in many ways they have fueled the craft beer boom almost single-handedly. The traditional big-volume beer sellers have struggled, though, in no large part due to the fact that Millennials don’t like mass-market beer. As a result, we see companies such as MillerCoors looking to smaller agencies like Mekanism to create campaigns tailored specifically to the Millennial, such as this one:
Among the things worth noting about this ad:
- it’s short. 16 seconds is all the time it takes to make their point. Millennials tend to not have long attention spans and a 30-second commercial is likely to be overkill.
- it’s real. Millennials are hitting their childbearing years and responding to that natural desire. However, these are not super-young 20-something couples; they’re older, more mature, which is common among this and subsequent generations.
- it’s not sexy. No girls in bikinis, no buff guys in baby oil. While the couples are reasonably attractive, Millennials don’t respond to over-sexualized images the way that Boomers did.
- it shows a reasonable income bracket. No large pool, no large house. Millennials want homes, but haven’t been able to afford them, so showing a smaller house that is more likely a rental is appropriate.
MillerCoors isn’t the only one getting the message. Hilton Worldwide has announced it will be opening a new chain of hotels called Tru that is designed specifically to attract Millennials. The first hotel is scheduled to come online later this year, with approximately 132 facilities planned for cities that are popular among that generation, such as Portland, Dallas, Atlanta, Chicago, and Denver. The hotels will focus on highly personalized service and what they refer to as a “common, youthful look.” Their ads will be, “visually represented through spirited photos with playful and vibrant colors; custom, fun illustrations; circular shapes, not only to invoke our logo, but also to convey that we are different; and the custom vernacular we’ve created for this brand using three-letter words like zip, jam and fit,” according to Alexandra Jaritz, global head, Tru by Hilton.
There’s no question that Millennials like to travel, but even there they’re not doing it in the same way as Boomers. This is evidenced by the very existence of AirBnB, which is counting on Millennials (and Chinese tourists) to help make it profitable. Can Tru by Hilton create an experience-based standardized accommodation that actually competes with staying in someone else’s home? I have to admit, this could be entertaining to watch. I’m just glad I don’t have any money invested with either approach.
For all the places that are at least trying to understand Millennials, however, there are four or five times as many companies who don’t, and those are likely to be some of the major losers over the next few years. Here are some of the sectors I think really need to step up their game if they want to stay solvent once Boomers are no more.
- Banking & Finance. Millennials don’t trust banks and they damn sure don’t trust Wall Street with their money. As a result, the climate is right for an alternative to come in and set a genuinely new paradigm in the financial sector. Unfortunately, this also may make Millennials more financially vulnerable in the long-term.
- Cable Television. It’s been suggested that there is too much television already. What’s driving this concern is the fact that only 46% of Millennials watch any television programming at all, and the vast majority of that is on mobile devices. Millennials have cut the cord with cable pretty hard and I’m not sure it is remotely possible to convince them to come back.
- Transportation. Just as the auto sector is starting to recover from the recession and sales are picking back up, they soon need to begin re-examining their approach to the Millennial market, which, as a group, doesn’t exactly like cars. Even with the new hybrids and promising growth among alternative-fuel vehicles, Millennials would still rather ride their bicycles, take public transportation, or call Uber for a ride. Environmental concerns override money issues on this one. While there are more than enough Boomers still buying cars, and big ones at that as gas prices plummet, automakers need to re-work their approach to a generation that doesn’t have the brand loyalty their grandparents did.
- Warehouse Clubs. This one kind of makes sense. Millennials live in smaller places and have limited transportation options that don’t involve carrying around a pack of 46 paper towel rolls. While all the major warehouse clubs have online purchasing options, the positioning, design, and marketing of those options leaves a lot to be desired. If they want to capture Millennials, the folks at Costco and Sam’s Club need to follow Amazon’s example and then improve upon that experience.
- Family-related services. This includes anyone involved in health care, children’s services (including clothing and education), and anything to do with weddings. Millennials are totally redefining family. Who and when they marry, when or if they have children, and how they approach health care have significantly different answers than previous generations. A lot of traditions are being left in the dust and will not recover. Those who survive will do so only by completely re-configuring how they do business and how they market to this new generation.
These are not insurmountable issues. For all the challenges some companies may face, there are reasonable answers for most. There’s no time to waste, though. Companies who don’t have a Millennial-focused plan by the end of this year are going to find it increasingly difficult to ever win that business at all. You want Millennials’ money, you’ll have to work for it!
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