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Generational Marketing: Millennial Marketing 101

1 Nov, 2011 By: Bridget McCrea Response

How to effectively market to the 80 million-strong “wired” millennial generation.

Brian Wong knows a thing or two about marketing to millennials. After all, at 20 years old, this founder and CEO of San Francisco-based Kiip is one himself. He knows what the under-30 crowd likes and dislikes; what types of advertising it responds to; and what approaches work best for the last generation born in the 20th century.

Generational Marketing“We are a very ‘connected’ bunch,” says Wong. “We’re also the first generation that truly has the ability to choose what kind of advertising we want to receive, and we’re loyal to the brands that we love.” And those brands had better be able to reach their young consumers through a variety of means, including TV, online, social media, print and mobile advertising.

“I expect to be able to access anything from anywhere,” says Wong. “I get annoyed pretty quickly when a particular firm’s Flash website isn’t accessible from my mobile device, for example.” Even more irritating for Wong are those marketers that rely on the “carrot-and-stick” methodology to draw in consumers. “My generation doesn’t want to be guilted or tricked into responding to an ad,” he says.

Wong, who in 2010 was the youngest entrepreneur to receive venture capital money ($4.4 million) to start his mobile marketing company, says brands that take the time to build positive rapport, and that give away free incentives and rewards in exchange for loyalty, tend to do best with millennials. Kiip adheres to this philosophy, and offers rewards from well-known brands in return for its customers’ virtual gaming accomplishments (such as reaching a high score).

“It’s all about building positive rapport without trying to use ulterior motives or tricks,” says Wong. “Spend less time working on spin and more time working on real value. That’s what works.”

Breaking It Down

Also known as “Generation Y,” America’s youngest generation spans a broad age range from adolescents to adults in their early 30s. According to the Pew Research Center, millennials represent the most ethnically and racially diverse cohort of youth in the nation’s history, with 18.5 percent being Hispanic; 14.2 percent African American; 4.3 percent Asian; 3.2 percent of mixed race or other; and just 59.8 percent (a record low) Caucasian.

The millennial generation is the first in history to regard behaviors like Tweeting and texting, along with websites like Facebook, YouTube, Google and Wikipedia, not as astonishing innovations of the digital era, but as everyday parts of their social lives and their search for understanding. This presents both opportunities and challenges for marketers that are struggling to understand this demographic, which comprises more than one-quarter of the U.S. population — or about 80 million individuals.

“Marketing to the first generation to grow up with the Internet poses unique challenges,” says Jeff Smith, chief marketing officer and senior vice president of client services at Vizu, a digital market research firm in San Francisco. “Unlike their parents, technology is integrated deeply into their lifestyle, and provides the primary means of staying connected with friends, schools and family.”

The “connected” lifestyles that Wong mentioned create new opportunities for brand marketers that want to reach this huge, desirable demographic, and interact with it in a meaningful, influential manner. “Keep in mind, however, that this audience requires a unique approach,” says Smith, “and adjust your advertising strategy and tactics appropriately.”

According to Jonathan Hills, founding partner at Bashki Generation, a digital agency in New York, that means first understanding that millennials are literally defined by technology. “Unlike Baby Boomers, who are still trying to understand and get a grip on technology,” says Hills, “millennials are fully immersed in that high-tech world.”

That technology bent has resulted in the need for instant gratification, to the point where even E-mail isn’t fast enough anymore. “Millennials won’t sit up and take notice unless there’s instant gratification or reward associated with the offer,” says Hills. Most are also immune to the information overload that they’ve been dealing with since a young age and are looking for offers that stand out and that provide true value for their lives.

“The younger generation is adept at filtering out the background noise to find what it wants,” says Hills. “When you do get the millennials’ attention, the advertising has to quench their thirst and provide instant gratification.”

Success Strategies

One of the easiest ways for marketers to sift through the clutter and grab the attention of millennials is by funneling their efforts to the place where most of the 30-and-under crowd hangs out these days: online. “Millennials have a strong online and social media presence,” says Tina Wells, CEO at Philadelphia-based Buzz Marketing Group, “and they expect marketers to be just as connected as they are.”

And as Wong pointed out, the younger generation is also concerned with the overall brand experience and the added value that a product or service will bring to their lives. To hit those targets, Wells says marketers have to know why their products are unique, and exactly what consumers expect in terms of price and value. “From there, it’s about effectively communicating your product to the audience,” says Wells, “and zeroing in on how much added value it provides.”

The marketing message itself is a critical component of any millennial-centric campaign. “Don’t try to talk down to them, and definitely don’t try to create a situation where you are the authority or the ‘expert,’” says Hills. “You have to speak to millennials in their voices, and in a way that doesn’t seem contrived. They know when they’re being talked down to, and they quickly pick up on marketing messages that don’t sound natural.”

Greg Bayer, vice president of product and strategy at Adknowledge Affiliate in Kansas City, Mo., says word-of-mouth goes a long way when it comes to reaching millennials, many of whom turn to their online social networks for advice on picking out products and services. Bayer says marketers who assume that only the youngest millennials — teenagers — are using social networking for such reasons will completely miss the boat.

“Social networking isn’t limited to the folks who are in their teens and early-20s,” says Bayer. “It extends across the entire generation, and is a great place for marketers to start because it plays a key role in how these individuals make choices.”

Reeling Them In

They may be high-tech and wired, but millennials still love the television, magazines and newspapers that they grew up with. Of course, they are consuming more of that information and news online, and accessing TV shows which are streamed or downloaded via the Web. “The traditional mediums are still very much alive, but they’re being accessed on all screens — from television to the Web to the mobile device,” says Wong. “We’re not just consuming from one source; we want to look at different screens, and at various times throughout the day.”

When looking at those “screens,” Wong says millennials are keeping their eyes open for ads featuring products and services that actually matter to them, and are disinterested in the marketing messages themselves. “A lot of marketers assume that we care about the messages being put in front of us,” says Wong, who chuckles at the thought of a roomful of high-paid ad execs sitting around a conference table, brainstorming how to properly frame and position those messages.

“The fact is, the first thing we’re going to do is search for the brand on Google, and then use social networking to see what our friends have to say about it,” Wong explains. “If there’s something negative floating around out there on Google or Facebook, we’ll move on to the next choice.”

Call the approach fickle, if you will, but it seems to be working for millennials. And as the massive millennial generation continues to age, graduate from college, join the workforce, get married and start families, the marketers that took the time to hone their efforts around its wants, needs and preferences will be the ones that come out ahead.

Hills is confident that brands will “get it,” but has a tough time envisioning a 50-something advertising executive “connecting” with a 20-something consumer. In fact, he says a generational overhaul is in order, particularly in firms where older executives reign, and make the decisions regarding ad campaigns and marketing messages.

“Younger executives need to be given a real voice, and an opportunity to rise up through the ranks,” says Hills. “The companies that recognize this, and that build a workforce with a culture which allows millennials to flourish within it, will be the ones with the best chances for success.”

Just the Facts

If you’re launching a marketing campaign targeted at millennials, consider these 12 important facts about your audience:

1. Teenagers send a median number of 50 text messages daily.

2. Forty-eight percent of millennials says word-of-mouth influences their product purchases more than TV ads.

3. Forty-seven percent of 16- to 24-year-olds are employed, the smallest share since the government started recording data in 1948.

4. Forty-five percent of millennials highly associate their lives with simplicity.

5. Three percent of millennials say they get their news from Facebook and Twitter.

6. Forty-three percent of 18- to 24-year-olds say that texting is just as meaningful as an actual conversation with someone over the phone.

7. Thirty-three percent of millennials live in cities, and 14 percent reside in rural environments.

8. Thirty-two percent of millennials say they don’t like advertising in general, compared to 37 percent of the general population.

9. The approximate annual decline in E-mail usage among those ages 12-34 over the past year: 27 percent.

10. Twenty-four percent of millennials say “technology use” is what most makes their generation unique.

11. Twenty-one percent of millennials say helping people in need is one of the most important things in life.

12. Five in 10 millennials say they travel for leisure with friends — nearly 20 points higher than older generations.

Sources: Pew Research, Intrepid, Bureau of Labor Statistics, eMarketer, Iconoculture, Experian Simmons, ComScore, PGAV Destinations and Brookings Institution.

Due Diligence

Jeff Smith, chief marketing officer and senior vice president of client services at Vizu, a digital market research firm in San Francisco, works often with publishers, ad networks, agencies and brands that want to do a better job of reaching the nation’s 80 million millennials. Before that can happen, Smith says marketers should take a step back and truly understand that group which they’re targeting. Here are a few important pieces of information to factor into your firm’s millennial marketing campaign:

  • They want to be entertained.
  • Entertainment, music, video and social sites generate the highest brand lift (which occurs when the ads achieve success when measured against classic purchase funnel metrics, such as awareness and intent).
  • Products need to be an integral part of their lives.
  • Relatively inexpensive products like consumer packaged goods (CPG) and quick-service restaurants show high brand lift among a demographic that skews towards low income.
  • Entertainment and technology remain the top interests/hobbies for a demographic that expects to be entertained.
  • They want experiential advertising (ads designed to evoke strong sensory responses from the audience, as opposed to pitching a rational sales message).

“Unlike Baby Boomers, who are still trying to understand and get a grip on technology, millennials are fully immersed in that high-tech world,” says Jonathan Hills, founding partner at Bashki Generation, a digital agency in New York.

About the Author: Bridget McCrea

Bridget McCrea

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