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Today, just two percent of Millennials in the U.S. belong to the millionaire club. That number is poised to rise quickly as Baby Boomer parents begin transferring a lifetime of accumulated wealth to their Millennial children. Over the next two decades, most of the spending power in America—some $68 trillion—will consolidate in the hands of Millennials.
Marketing and sales leaders should start thinking now about how this massive wealth transfer will affect long-term branding and marketing strategies. Millennials, rich and soon-to-be-rich, have different spending habits and interests than their Baby Boomer parents.
Champions of small and local businesses
Per a 2017 AT&T survey, just 38% of Gen X and 42% of Baby Boomers will spend more money to support a small and/or local business. CGK research shows that an even smaller percentage of Gen Z, or iGen, will pay more money to go local—just 34%.
However, nearly half of Millennials report willingness to absorb the extra cost of shopping at mom-and-pop stores. “Millennials have an especially strong desire to put money back into local communities,” says Jason Dorsey of CGK. “They’ve grown up with the rise of Wal-Mart and Amazon, and feel the need to help revitalize small businesses whenever possible.”
Small and midsize business leaders can attract more Millennials with spending power by increasing their company’s visibility as a local business with close ties to the community. Marketers and salespeople at larger firms should consider emphasizing partnerships with smaller companies and focusing their brand position around enriching local communities.
Video gamers with money
Unlike previous generations, Millennials (and their Gen Z successors) regard video game playing as a generally constructive activity. Per CGK research, 50% of Millennials believe video game skills have real-life applications, ranging from strategic prowess to creative inspiration.
“Computer and console games have evolved incredibly in the past decade,” says Denise Villa of CGK. “Millennials came of age and spent early adulthood engaging with these digital worlds, many of which foster complex strategic thinking, creative innovation, and even dynamic interpersonal skills.”
40% of Millennials play video games at least once per week. eSports, especially the immensely popular League of Legends, require competence in strategic, interpersonal, and reflexive dimensions of performance. Success in these games has been correlated directly to fluid intelligence.
As Millennial spending power skyrockets, marketing and sales leaders should start thinking now about positioning products and brands to align with this generation’s affinity for video games and professional video gaming. For Baby Boomers, video games were often a fleeting arcade attraction with little real-world value; for Millennials, they represent a serious and effective tool for cognitive development.
At CGK, we are passionate about helping brands adapt to major generational shifts and trends. Click here to schedule a call to see how we can help you through custom Millennial market research or brand consulting.