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AN INTRO TO SELLING & MARKETING TO MILLENNIALS & GEN Y
Numbering almost 84 million, Millennials are the fastest-growing, most diverse generation of consumers in the United States. This is true globally, too.
Popular belief says that Millennials are broke. It’s not true. Millennials are simply entering their wealth accumulation phase later than Baby Boomers—who are often the ones doing the “wealth comparison.” In reality, it is likely that Millennials will outspend Baby Boomers in 2017.
Millennials, also known as Generation Y and Echo Boomers, have grown up being advertised to more than any previous generation and with more choices for products and services than ever before. Most importantly, Millennials have come of age with more channels and ways to buy, rent, share, and pay for products and services than any previous generation. These changes are setting new rules for sales and marketing.
Yes, Millennials have more college debt (over $1.3 trillion!) and, in many cases, the credit card debt to go with it. But given the generation’s size and annual increase in earnings, they will navigate through their debt over time. We predict that the average age of a first-time homebuyer will be older for the Millennial generation than it is for previous generations, but overall spending will continue to grow year after year. It’s important to note that major purchases are often driven by life stage (i.e., marriage and kids), which Millennials have needed more time to reach. They will still buy cars and houses; they’re just doing it later.
When Millennials outspend Baby Boomers in 2017, a huge marketplace shift will take place, and the spending paths will only diverge more. At The Center for Generational Kinetics, we discovered that Millennials:
- Have the greatest lifetime value of any customer in the marketplace
- Have the least-established loyalty as customers—but they are very loyal once they select a brand, service, or company
- Are most likely to refer their friends when they have a good shopping or buying experience
Most importantly to salespeople, marketers, and innovators, Millennials communicate, shop, and buy differently than any previous generation. This is why traditional sales and marketing tactics do not work with Millennials. The Center focuses on uncovering what works now with Millennials at various life stages, over various platforms, and with diverse spending potential and habits.
10 THINGS TO KNOW ABOUT MILLENNIAL CUSTOMERS & CLIENTS
1. Millennials were born between approximately 1977 and 1995.
The birth years for Millennials in the United States stop at 1995 because those born later cannot process the significance of September 11, 2001 in the way those born before 1995 do. In other words, if 9/11 has always been history, then you are not a Millennial.
2. When you think about how to market to Millennials, start with their life stage.
Millennials are approximately 21 to 39 years old. This age range covers a broad range of key life events, from earning an education and moving into your own apartment (with three roommates) to being married with two kids. The subgroups within the generation are key for marketing and sales.
3. The Center for Generational Kinetics made the important discovery that Millennials are breaking into two different generational groups.
One group of Millennials is reaching all the traditional markers of adulthood, just a few years later than previous generations. This group is entering their wealth accumulation life phase and commanding more power in the marketplace. The other group of Millennials, however, is not creating “real-world traction.” It is important to identify which group represents the ideal customer for your products, services, and solutions because each group has different purchasing criteria.
4. Millennials are the most consistent generation in the world.
Whether we work in Chile, Egypt, India, or elsewhere, Millennials are the most consistent group of all the generations. This is due to many factors, including inexpensive mobile technology.
5. Millennials are primarily visual buyers and learners.
This generation has been conditioned to make purchases while looking at a screen, skipping blocks of marketing and advertising text. The Center works with marketers and salespeople to increase conversion with Millennial customers by improving visual layout, overall copy, and specific calls-to-action.
6. Millennials communicate differently than other generations in the market.
At The Center, we found that Millennial customers prefer to communicate in this order:
- Text—in many cases, IM apps such as WhatsApp are used more than texting
- Email, with the subject line being most important
- Social media
- Phone call
7. Millennials are paying for products and services differently than other generations.
If companies, salespeople, and brands don’t adapt, Millennials will simply not buy from them—they’ll go to the next guy who has adapted. For example, in a recent national study led by The Center, we discovered how shockingly little cash Millennials actually carry on a daily basis. What does this mean for you? If you want to attract and keep Millennial buyers—especially for small transactions where a couple of dollars can make all the difference (i.e., tipping)—make it easy to pay with a card.
8. Millennials don’t just spend their own money.
It’s important to remember that their Baby Boomer parents often provide access to more money and credit. Millennials are entering adulthood later, and as a result, many Baby Boomers are providing financial resources and a financial backstop to their grown children, sometimes well into their 30s. Or maybe it’s the other way around: Baby Boomers continue to offer financial support, so Millennials don’t need to enter adulthood. In either case, this expands the spending and economic power of the Millennial generation. Even if they don’t personally have the funds, they can direct money from other sources. Thanks, Mom and Dad for the “emergency” credit card!
9. Winning Millennials is not just about Millennials. You need to keep all generations of customers in mind.
The Center discovered that Gen Xers and Baby Boomers are starting to communicate, shop, and buy similarly to Millennials. Thus, if you win Millennials, you are in a strong position to attract and keep other generations—but if you lose or miss Millennials as customers, you increase your risk of losing your Gen X and Baby Boomer customers as well.
10. Where can I go for specific, research-driven strategies and tactics on how to attract, keep and grow Millennial sales?