Wednesday, August 26, 2015

Millennials: What Marketers Need to Know

From Business 2 Community...

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While we were watching Friends, drinking Pepsi Blue, and texting in T9 on our Motorola Razrs, these words were nearly non-existent. Hard to believe, right?

A lot has changed since this era, including the large increase in spending power of the 15-38 age group, referred to as the Millennials. And by large, I’m referring to buyer power valued at over $3 trillion. Starting in 2017, the Millennials are collectively expected to spend more than $200 billion annually and $10 trillion in their lifetimes. Millennials are also considered to be extremely influential to the buying practices of older generations.

Seems like a no-brainer to target this market. You’re probably thinking you hit the jackpot. But there are reasons why so many marketers have failed to successfully market to Millennials. What has worked in the past is not going to work in the present, or the future. If you want to effectively market to Millennials, you better learn to keep up. And it starts with: Understanding the makeup of Millennials, Understanding their values and Understanding their behavior.

Meet the Millennials

Millennials currently make up approximately 25% of the US population. They are becoming parents (1 in 4 Millennials are now parents), and gradually saturating another consumer market segment. They are brand loyal but are subject to trends. They believe in good causes (50% of Millennials) are more willing to make a purchase from a company if it supports a good cause.

Evolution has allowed for their smartphones to become one with their bodies. An extension to their hand. Today, Millennials all find themselves mixing technology terms like “timelines”, “shares”, “insta”, “wall” and “snap story” into their everyday conversations with ease and normality. Millennials grew up in an environment powered by the internet. They have a limited collection of memories from a time before everything was online. The internet has entertained, socialized, informed, organized, and educated this generation.

Millennials are reachable at nearly any hour of the day on one of the many social media accounts, and are extremely expressive of their interests, needs and wants. They’ve grown up targeted by specific brands based on their demographics and not at the convenience of their attention or interest. It takes devotion and care when it comes to getting a Millennial’s attention and maintaining it, as they are expert multitaskers, technology enthusiasts, and hard-wired to distrust brands.

They have the ability to research, compare, and review any product, service, or brand they want, at their fingertips. The Millennial’s phones are cameras, schedulers, music players, and mini computers. Their world is smaller, and they are very aware of what is happening around it. They take interest in societal issues and value support from their peers.

Any question Millennials have can be answered in seconds by typing it word for word into a Google search bar that understands full sentences. They are a traditional advertiser’s nightmare, but a digital marketer’s dream audience, if approached correctly. These are the Millennials, and they refuse to be simple.

What Drives A Millennial?

Insight #1: Millennials can smell phony brands a mile away

They crave the authenticity that comes from a real, online community. Contrary to their craving, they believe that their current interactions with brands are mostly synthetic and cold-blooded.

Authenticity comes from being transparent. As a marketer, you can gain consumers’ business if you build their trust. By addressing the problems you’ve encountered, the challenges you’ve overcome, and the values you represent, you show genuine interest in building a relationship with them by being transparent. You are showing the human element to your brand.

This is particularly effective when executed within online communities, where consumer discussions are taking place. The authenticity found in influencer marketing campaigns is the reason why this form of marketing is so successful. By engaging with influencers who millennials trust, your brand gains trust through association. In turn, consumers will see your company as warm-blooded humans as opposed to an object or faceless entity.

Patagonia saw an incredible opportunity to reinvent their relationship with customers by

creating Footprint Chronicles. This ongoing campaign’s purpose is to communicate their sustainability efforts by creating videos that show the supply chain of their products, going all the way back to the farm where the cotton of their sweater was gathered. As a result, Patagonia saw a 10% growth in just 2 years and attracted loyal customers who support ethical and ecological business practices.

Insight #2: Millennials have selective attention spans

Millennials’ patience is dwindling when it comes to marketers’ attempts to “reach” them. They avoid traditional advertisement channels by using PVR, online streaming, or podcasts. Only 22% of media viewing time is dedicated to traditional TV series. Sites such as Netflix allow for Millennials to engage in periods of “binge watching”, where ads can be avoided entirely for a small price, nearly eliminating the need for cable television.

If marketers are trying to get through to Millennials, they need to explore other ways of conveying their message. And equally as important, they need to pay attention to what they are trying to communicate. Millennials want to be provided with good, original content that is valuable and personalized. By sending content that is relevant to them, they will want to do something about it, including sharing it with their friends.

Sephora’s winning formula includes paying careful attention to highly relevant, personalized data. Through their Beauty Insider loyalty program, they were able to gather specific information on their members. In return, members would receive emails with product suggestions relevant to the information they provided. 80% of Sephora’s transactions run through their loyalty program.

Insight #3: Millennials crave an experience

70% of 13-23 year olds say experiential marketing is extremely or very influential on their opinion of a product or brand, according to those surveyed by PR Newswire. This generation’s happiness isn’t focused so much on ‘things’ but creating and sharing memories. They are looking for new and creative activities that appeal to their current interests, ever-changing world, and that will add a check to their “life experiences” list. Experiential marketing has been around for ages, but now, there’s the added component of reaching larger audiences through social media. This is where the infamous FOMO (fear of missing out) comes into play. These generational factors must be taken into consideration when creating a campaign targeting Millennials.

Marriott Hotels has taken steps towards reaching the Millennial guest. In London, the Marriott Hotel hosted an outdoor rooftop picnic (#roofnic), aiming to attract and win over Millennials with their never-before-used rooftop turned rural picnic park, during London’s summer heat wave. Marriott Dubai took on a similar, but less subtle approach to attracting Millennials, by creating Square – a nightclub to host some of the world’s hottest DJ’s. The hotel kitchen matched the theme by serving square shaped hors d’oeuvres using the slogan and #bedifferent.

These new locations and venues are all active in the social word, promoting location specific hashtags and active engagement with the visitors. Each update is meant to appeal to the local environment and be unique to the city as well as attract the newest generation of guests.

Insight #4: Millennials are the social generation

Millennials are more likely to learn about new products using social media before making a purchase. They value the ideologies of ‘word of mouth’ and the sought-after “review”. A whopping 70% of Millennials feel responsible to share feedback with companies after a good OR bad experience. Millennials require on-demand information, and trust the advice of friends and even strangers over that of authority figures, organizations, and brands using social media.

The age of digital marketing has given way to ‘influencers’ and the progression of peer reviews, blogs, and influencer campaigns. This clears the pathway for influencer outreach within the marketing industry as a whole, due to its powerful ability in reaching Millennials.

Through influencer marketing, there is opportunity for brands to engage with “experts” in specific categories, such as fashion, food or technology. By channeling their authenticity and transparency in reviewing products or services, their messages have the potential to have an echo effect on the audience they influence, also known as ‘amplification’ in the marketing world.

This influence can take place over any number of social media outlets. And when it comes to Millennials, there are a few networks that reflect their needs from the insights gathered, and they could be holding the key to ultimate success.

Where to find Millennials

Millennials saturate the social scene, spending nearly 18 hours a day consuming media, and 5.4 hours per day on social networks. 85% of Millennials own a smartphone, that they check nearly 42 times per day, this generation seems to be ever-present and accessible online. Being highly visual, Millennials use their social networks as multi-use tools. These networks provide insight on news, social updates, shopping, and industry trends.

Millennials are extremely connected and present, but much of their social interactions take place virtually. A study by the Pew Research Center shows that 87% of Millennials ages 18-29 can be found on Facebook, 53% on Instagram, 37% on Twitter, and 34% on Pinterest. They engage with social networking sites to collect reviews, updates, trends, advice, and to be entertained. More recently its been evident that Millennials gather much of their news from various social networks rather than seeking traditional media. According to theAmerican Press Institution, 88% of those surveyed gather their news from Facebook occasionally, 83% from YouTube, and 50% from Instagram. These visual networks are important to consider when planning a campaign that targets Millennials, as this will be a direct path into their socially-driven world.

Now, what?

Millennials are savvy and aware. They crave information, personalization, trust, and authenticity. They’re a generation that possesses a buying power greater than what the world has witnessed before them. They accept information presented to them from reliable and credible sources, but have adapted their methods of information intake to conform with the growth and development of technology. It is only fitting that marketing methods grow with them.

Over to you! What other insight has driven your marketing strategy to target Millennials? How have you used it to successful target this generation?

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