Several billion-dollar industries are flourishing, thanks to Millennials. The generation, particularly its women, have helped to breathe new life into several sectors. US apparel manufacturers ($12 billion), clothing store operators ($180 billion), hotels ($160 billion), and telecommunications equipment makers ($42 billion) are just a few of the industries that are flexing their marketing muscle since young consumers took notice, embraced them, and wove them into their lives.
The newfound strength of these industries can be attributed to the strategic marketing efforts of certain companies that have taken the time to get to know Millennial women. The more Millennial-savvy companies work to engage with consumers, the better they fare. These companies started early on and are reaping the rewards.
Some industries are struggling as they wean themselves off the more predictable and sustaining Boomer and look for new ways to serve the Millennial generation, which has the potential to provide profits for decades.
I was fortunate to spend some time with generational marketing expert Ann Fishman to dig deeper into the mindset and motivations of Millennial women specifically. As I mentioned in Q&A: The Most Coveted Millennial, Fishman recently published Marketing to the Millennial Woman, which enlightened me about the cohort’s better half.
I’ve asked her to share more of what she has discovered in her research, specifically about Millennial women as consumers.
Typically, women are the primary shoppers in a household and make more of the buying decisions. This may be specific to Boomers or Gen X, however. Does this hold true to Millennial women, and, as a result, is this group more valuable to marketers than Millennial men?
Yes, millennial women love to shop and are fashionistas. For that reason and many others, they are more valuable to marketers than Millennial men. Millennial women also are the most diverse group of any generation and have choices women before them did not have. Some decide to be stay-at-home moms, or to raise pets instead of children, and many are the sole or primary earners for their families. Many marry late or choose to remain single. They are physically strong and participate in sports. Fifteen percent in the military are women. Most are into technology and social media. Their diversity is a big plus for businesses looking to expand and explore new opportunities.
How are companies keeping up with what Millennials want and need? Are there basic services or technologies that most companies should offer to reach this generation?
More than ever, companies wanting to keep up with the “wants,” “needs,” and “desires” of this generation must really listen to them. To help expand their skills, there are basic services and technologies that must be offered. Any company wanting to be on the cutting edge of the next great opportunity needs to take advantage of all the existing social media the Internet offers and present a Millennial-friendly website representing their uniqueness. For businesses to stand out in the digital world of clutter, websites, tweets, and blogs, they must have personality and be interesting enough to grab and keep the attention of the Millennial woman.
The Millennial woman seems to be well-positioned as a well-educated person who is focused on family, concerned about the environment and others, and is an extremely savvy consumer. Other than being attracted to companies like Tom’s and Benefit Cosmetics for their social-consciousness, what other traits attract Millennial women specifically to certain companies over others? How can companies set themselves apart from others in their industries — or even niche players in similar industries — to pique the interest of Millennial women to spend money with them?
Millennial women are attracted to a company because its products and services connect with their generational characteristics (for example, their need for constant change). That’s why H&M and Zara are hot.
Where are companies falling flat on their efforts to attract Millennials? Will you share an example?
Companies that are falling flat are those who allow customer information to be get hacked, have poorly designed websites, and misunderstand Millennial customers’ needs. For example, Target’s website crashed during its Missoni promotion.
Mentioned in your book, how did the five-second rule of marketing to Millennials come about? Is that everyone’s attention span or is Millennials’ even shorter?
The five-second rule fits Millennials. Why? The best YouTube videos pull them in from the start. Tweets and texts can be read in five seconds. Millennials want it short, fast, and worth their time!
Are celebrity endorsements effective in attracting Millennials and in deepening their bond with a brand? Have celebrity endorsements become more prevalent during Millennials’ upbringing?
Celebrity endorsements work to the extent that they encourage Millennials to try a brand. They have become more prevalent only in certain industries, such as the perfume industry.
Some of the more successful advertising efforts have come from empowerment through products. In the competitive personal-care products industry, Dove has boosted its brand through its empowering ads. Any other example?
QVC has been a groundbreaker in selling personal products. They educate women on what a product can do. They show viewers how to use them. They let customers return products they don’t want. QVC posts reviews — good and bad — from buyers. And QVC is rewarded for its efforts with customer loyalty.
Tech startups, particularly in Silicon Valley, seem to be one step ahead of larger, established companies in looking into the minds of Millennials, perhaps because a fair share of these fledgling business enterprises are begun and run by Millennials. Do you think that the success of a startup is fueled by Millennials, who are more likely starting these companies to satisfy a Millennial need? One example is car sharing. Others are Tumblr and Snapchat. Established companies seem to be aggressively buying tech startups to quickly boost capabilities through add-on acquisitions.
The answer is yes. Millennials want something that’s not available. They create it themselves, and often big companies buy them out.
Strategies on how to market to Millennials have been in the news for years. The cohort is definitely on the radar of companies, especially those that want to survive and profit throughout Millennials’ spending years. With so many companies clamoring for the attention of this potentially lucrative generation, what traits have you identified that are common among companies that “get it” and are successfully serving Millennials today and for the long haul?
Dove, Kimpton Hotels, and Converse, as examples, make changes to their products, services, and marketing to accommodate the Millennial generation’s values, attitudes, and lifestyles without alienating other generations.
After all your research, can you walk into a room and identify the Millennials? How can you spot them in a restaurant? In a store? At work?
Yes. Millennials are easy to spot. They are ages 15 to 33. If you walk into Starbucks and see two young women sitting together, drinking coffee, and texting for 20 minutes, they’re Millennials. If you see 3-plus young women shopping together, they’re Millennials. If you see young women dressed inappropriately at work, they’re Millennials. If you hear young women using inappropriate language, yet not realizing it, they’re Millennials.
Other than pet food manufacturers and pet food services companies, which have benefited from Millennials delaying having their own families by being pet parents, which other industries have flourished on behalf of this generation?
Industries that have flourished because of Millennials: the fashion industry (H&M and Zara), the hotel business (Kimpton and Courtyard by Marriott), and smartphones that take great photos.
Most Millennials were forced to be frugal, having witnessed the worst economic downturn since the Great Depression. Despite low mortgage-interest rates, Millennials are not pulling the trigger on buying into the American Dream by becoming first-time home buyers. Residential real estate businesses and home builders had been banking on this since early 2015 due to pent-up demand. Millennials cited student loan debt as the top reason for delaying the “achievement” of homeownership, and they’re continuing to either live at home or rent. Coming up with a down payment has grown far more difficult with their tight budgets. So, as a result, the percentage of today’s first-time home buyers has dropped to a nearly 30-year low. This is worrying real estate brokers and companies focused on building (and selling) new homes. Is this just one example of how Millennials, based on their more unique circumstances, tend to frustrate executives in certain industries when they don’t act as other generations have?
Yes, certain executives are frustrated. In the auto industry, Lexus is considering changing its sales model to capture Millennial business. On television, the news is affected by the use of blogs since Millennials want their news in real time. The banking industry also has changed because Millennials bank online. They don’t need tellers.
Young consumers have helped to give rise to microbreweries, urban living and farming, primitive camping, upscale specialty grocery stores, and a deeper sense of the word “foodie.” There seems to be plenty of opportunity to tap the enthusiasm of this eccentric group, particularly because they’re eager to try new things and are drawn to new experiences through travel. What industries have been born and are taking flight based on Millennials alone?
First of all, specialty food stores are taking flight. They are tapping into the Millennial market by offering exotic and healthy foods for vegans and Paleos. Uber picks up and delivers in five minutes. Everyone now has a chauffeur. Selfies are responsible for new products and services: selfie sticks, lighting devices, and plastic surgery. Millennials use points to fly luxury airlines like Singapore and Emirates that offer amenities such as onboard showers, private rooms, and a chef-cooked breakfast right at their seat.
Millennials crave individualized customer experiences. How are Millennials changing the concept of customer service?
Millennials understand their power. They consider it their duty to tell their friends, acquaintances, and anyone who will listen about their experiences with customer service and how they were treated. They expect companies to listen to them. For example, Zara’s salespeople report casual customer comments to management (“this material is scratchy, these sleeves are too tight”). Millennials expect to be pampered. Take Amazon, for example. This retail giant knows everything a customer ever bought and pampers them with suggestions.
Millennials grew up during a time of proliferating technology and mobility. The generation readily researches products, trends, and services. This makes marketing to them difficult as they become desensitized to brands and tend to be less loyal than previous generations. Besides reaching Millennials through mobile means perhaps, what other ways can a company engage with this generation?
Companies can engage Millennials by inventing intriguing ad campaigns focusing on their particular whims and ways. Domino’s caught their attention by enabling them to order by using a pizza emoticon. Jell-O created a Mood Monitor that Millennials love. Using information from Twitter feeds, the Mood Monitor counted the smileys and frowneys tweeted. If there were more frowneys, Jell-O offered a coupon for free pudding, along with a personal message to some unhappy tweeters.
Photo courtesy of Brooke Cagle.