Millennials Are Evolving; Are You Keeping Up?

The Recession Has Changed Them as Consumers, But They're as Valuable as Ever

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Megan Meagher
Megan Meagher

Marketers love Gen Yers. They've got roughly $200 billion in disposable income, and they aren't afraid to spend it on clothes, designer sneakers, alcohol, fast food, cellphones and video games. I'm familiar with the lackadaisical spending habits of Gen Yers, because I am one, and until last fall, I, too, splurged on things such as a Wii and an iPhone.

But I'm a changed person, thanks to this recession. I eat more meals at home and actually pay attention to the price of groceries. Living on my own for the first time, I find myself buying and using more household products, from dishwasher soap to stain remover.

As a result, I'm newly receptive to advertising in those product categories. But what surprises me is how few marketers -- outside of clothes, shoe, food-and-beverage and entertainment marketers -- actually pursue my age group. I wonder why that is, when much of what I've learned about brand building in my work in strategic planning suggests that marketers that reach out to Gen Y may find that the payoff lasts decades. Consumers settle into brand choices in their 20s, according to one report, and those preferences don't change much into their 30s and beyond. And get this: Brand loyalty increases with age -- 37% of 18- to 29-year-olds buy one favorite brand of mayonnaise, for instance, vs. 55% of those 30-plus.

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Kraft, PNC Bank reach out
To be sure, some brand managers have used these tough economic times to reach beyond their typical target audiences, particularly because the habits of consumers like me are changing.

Just recently, Kraft Foods launched a campaign for its Miracle Whip spread that does the unthinkable and looks beyond moms as the target. The goal was to simply remind young consumers about Miracle Whip, a sandwich spread and dressing they most likely grew up with but may have abandoned after childhood.

Along with a traditional media campaign and Facebook and Twitter pages, Kraft created Zingr, a software application that allows users to "zing," or comment on, content on the web. The tool is actually useful and savvy in how it taps into the way Gen Y consumes information. Zingr makes it easy for Gen Yers to share what they love to share the most: cool content and their opinions. Plus, Miracle Whip scores points for not overwhelming users with blatant product branding.

Another brand that does an exceptional job of wooing Gen Y is PNC Bank. Its efforts are particularly noteworthy in a category chock-full of generally uninteresting marketing. A friend of mine who lives in Philadelphia banks with PNC and claims that its Virtual Wallet has "changed the way I save." News stories report that the Virtual Wallet was developed in response to research results that revealed that Gen Yers view bank websites as being un-user-friendly. Gen Yers also admitted that they don't know how to manage money.

The tool allows users to track spending, schedule bill payments and set aside money for specific purchases. For example, my friend is saving money to start an IRA and to buy a Diane von Furstenberg dress. With Virtual Wallet, she turned what might have been a guilt-inducing splurge into a responsible and (more) rational purchase. As of November, according to reports, 130 new customers per day were signing up for the account. Its success illustrates that providing something genuinely helpful online is one of the best ways to earn the loyalty of my internet-addicted generation.

Commitment to doing good
Another approach marketers might consider when trying to gain Gen Yers' loyalty is to prove a brand's commitment to the community. Involvement and doing good particularly resonates with my age group. A 2006 study by Cone and AMP Insights found that 61% of 13- to 25-year-olds feel personally responsible for making a difference in the world, and 83% will trust a company more if it is socially or environmentally responsible.

A recent campaign from the online travel community TripAdvisor used social media to ask travelers how to distribute $1 million among five travel-related nonprofit organizations. More than 1 million votes were cast via mobile phones and online, and Doctors Without Borders received the greatest contribution, of $392,000. TripAdvisor established itself as a socially responsible brand without putting the onus on consumers to donate, and as a result gained credibility as a brand that gives back.

In a few years my generation will be the moms and dads of the world, the major household buyers. Within the next decade, we'll be generating $2.77 trillion dollars per year. It's essential for brands to grab us now and reach out in ways we find meaningful.

One possibility: opt-in programs to send coupons to our mobile phones (72% of those under 34 have printed or downloaded a coupon). Or try giving us a useful freebie, such as booklet of quick-and-easy recipes for one or a guide to removing stains (of the wine and ball-point-pen variety). Or even try something as simple as setting up a Facebook page about the affordability of renter's insurance and its benefits, then invite users to share horror stories of ruined possessions. Just make our lives easier, teach us something new and let us know that our dollars are just as valuable as those of the mom next door.

ABOUT THE AUTHOR
Megan Meagher is a 25-year-old account planner at Taxi, New York. She joined Taxi as an intern in 2006 and was later hired in the account-management department. Since 2007 she's been working in the strategic-planning department on clients such as New York Life and Blue Shield of California, as well as new business. She graduated from Syracuse University's S.I. Newhouse School of Public Communications in 2006 with a degree in advertising.
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