Welcome to the New Millenials1 May, 2008 By: Sarah Littman Response
The generation born between 1982 and 2002 — also known as Generation Y — exerts its spending power and drives marketers to rethink different avenues to gain a direct response to their campaigns.
They don't remember life before the Internet. Their worldview has been shaped by pivotal world events like 9/11, Hurricane Katrina and the Iraq War, making them the most civic-minding generation since World War II. They're accepting of diversity, perhaps because more than one-third are minorities themselves.
Welcome to the world of the Millennials, also known as Generation Y. Definitions vary, but it's generally considered to be the more than 81 million Americans born between 1982 and 2002, making it the largest generation to come along since the Baby Boomers.
Clearly, any demographic this size is one that companies don't want to ignore. Minneapolis-based consumer strategy firm Iconoculture estimates the direct spending power of the Millennials to be an astounding $1.3 trillion. But according to Bill Carter, a partner at Burlington, Vt.-based Fuse Marketing, that doesn't even begin to tell the story of this generation's marketing clout. "Research indicates that the influence of this group is five times its direct spending power, because these kids are so technologically savvy, their parents go to them for product advice on things like computers and personal entertainment devices," he says.
Although these free-spending, techno-savvy kids sound like every marketer's fantasy, there's a catch: first, you've got to get their attention. "There's so much clutter in the world of advertising that it's hard to break through," says Matt Britton, a founding partner at Mr. Youth LLC in New York.
Not only that, this is a generation that consumes media in extremely fragmented ways, making it less straightforward a reach for marketers. For example, while Millennials still watch TV, it no longer gets their undivided attention. According to The Kids' Social Networking Study by Grunwald Associates LLC, 64 percent of respondents said they go online while watching the box — and only 11 percent said that the TV was their primary focus when they were watching.
"These kids live in a choice environment," explains Nancy Robinson, vice president of consumer strategies at Iconoculture. "What's interesting is that they aren't suffering from choice fatigue. For them, choice isn't a distraction — it's a good thing."
A Fading Attention Span
Getting their attention isn't the only problem — you've got to keep their attention, too. An April 2006 JupiterResearch study found that 33 percent of consumers shopping online via a broadband connection will abandon a site if a page takes more than four seconds to load. "The attention span is short and getting shorter," said Pedro Santos, senior manager of industry marketing for Akamai, based in Cambridge, Mass. "Having the consumer wait an extra second can mean the difference between them purchasing your product or leaving the Web site. The speed of your retail site becomes the differentiator, a way of keeping that Gen X or Y consumer on your Web site."
RepNation is a site for social networking marketing. Young people sign up to be brand ambassadors for different companies and can earn rep rewards like iTunes gift cards.
One satisfied customer is Philadelphia-based specialty retailer Urban Outfitters Inc., which caters to a young, hip demographic. "Urban Outfitters came to Akamai looking for a sub-one second response time on its home and getaway pages. It achieved a 35-percent increase in quarterly direct-to-consumer sales, a 50-percent increase in site traffic and had reduced site abandonment after installing this solution."