Transcript Marketing to Generation Y

Marketing to Generation Y
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Marketing to Generation Y
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Demographic Trends
Marketing Communications
Spending Patterns
Media/Technology Usage
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15-23
24-31
32-36
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A great deal has been written about
‘Generation Y’ since the term was
first coined in 1993 by
Advertising Age magazine.
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The term refers to the last generation to
be born wholly in the twentieth century.
This group is also known as
“echo boomers,” the “millennials”
or often “generation why.”
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While the youngest Generation Y is only
10 years old, marketers are focused on
those who are currently 15-30 years old.
In the US, Generation Y is 70+ million
people strong, almost double the size
of ‘Generation X,’ its predecessor.
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Generation Y in Context
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This is a generation who never knew life without AIDS,
never felt the chill of the Cold War, who learned about
the birds and bees from President Clinton’s wellpublicized antics, wore designer kids clothes, never went
to a library for research and can’t imagine life without
ATMs, DVDs, DVRs, IM, AOL and SUVs.
Generation Y has always lived in a multimedia world and
has an innate ability to decode brand symbolism and
iconography.
The Gen Y world is one of contradictions that it
completely embraces. Young people can switch on
CNN and see disasters and then escape from it all
on an iPod.
Source: Brand Strategy
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Demographic Trends
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Generation Y Represents the Future Market
For Most Consumer Brands
Generation Y or Millennials are crucial consumers for all kinds
of businesses because of the size of this generational segment.
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Gen Ys according to Census data were born between 1977
and 1994, making this segment ages 15–32.
There are approximately 70 million Gen Y consumers.
By 2010, Gen Ys will outnumber Baby Boomers.
Gen Ys will make up 50% of the 18-49 demo by 2010.
The number of Gen Ys will grow to nearly 90 million
by 2020.
This generation – sometimes called the Net Generation –
is the most technology-savvy group of Americans.
Source: U.S. Census Bureau
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Adult Internet Population by Generation
Percent of Internet users (does not include teens)
Percent
Gen Y (18-32)
Gen X (33-44)
Younger Boomers (45-54)
Older Boomers (55-63)
Silent Generation (64-72)
G.I. Generation (73+)
Source: Pew Internet & American Life Project, Generations Online 2009 1/28/09
30%
23%
22%
13%
7%
4%
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U.S. Population Data
U.S. Census Bureau population estimates for 2009:
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2009 U.S. Population
307 million
100.0%
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Birth – Age 18
74,548,215
24.3%
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Age 18 – 24
30,412,035
9.9%
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Age 25 – 44
83,096,278
27.1%
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Age 45 – 64
79,379,432
25.9%
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Age 65 and over
39,570,590
12.9 %
Source: U.S. Census Bureau Population Estimates for 2009
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Percent Distribution of Total Population
Birth-18 Years
24.3%
65+ Years
12.9%
18-24 Years
9.9%
25-44 Years
27.1%
45-64
Years
25.9%
Total U.S. Population=
307 million
Source: U.S. Census Bureau Population Estimates for 2009
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Gen Y Racial and Ethnic Composition
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Non-Hispanic White Alone
60%
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Non Hispanic Black Alone
14%
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Non-Hispanic Asian Alone
4%
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All Other Races
3%
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Hispanic (Any Race)
19%
Source: U.S. Census Bureau, National Population Estimates and Projections.
Cited in MetLife Mature Market Institute 2009
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Family Life and Gen Y
As young adults, many Gen Yers consider marriage to be an
essential component of the American Dream.
Marital Status
Married
Males
Females
21.3%
27.9%
Widowed
0.0%
0.3%
Divorced
2.0%
3.2%
Separated
1.3%
2.1%
75.3%
66.5%
Never Married
Source: U.S. Census Bureau, DataFerrett, Current Population Survey, March Supplement, 2009. Cited in MetLife Mature Market
Institute 2009.
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Gen Y’s Priorities
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Gen Y places tremendous emphasis and precedence
on the following arenas:
Source: Millennials:” Confident, Connected. Open to Change”- Pew Social &
Demographic Trends 2/24/2010
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Marketing Communications
to Gen Y
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Marketing to Gen Y Grows in Importance
Advertisers are looking at creating new ways of
targeting Gen Y for several reasons:
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This consumer segment (or generational cohort) is
harder to reach with traditional media.
Gen Y is a collection of different psychographic groups,
each with its own motivations and preferences.
The Gen Y audience is very diverse and fragmented and
consequently more accepting than their predecessors
of diversity.
Advertising to the traditional, mass audience frequently
does not have appeal for the younger cutting-edge
consumers.
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Reaching Gen Y with Effective Marketing
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They are family and friend oriented. This is why cell phones
and two-way paging are so attractive to them.
Word-of-mouth marketing is very powerful with this group
because they are so friend conscious.
Viral marketing as a popular and effective medium- go where
they are in order to reach them.
They are very optimistic and have a positive outlook on
the world.
Non-profit sponsorships and cause marketing efforts will get a
positive response.
They are tenacious doers; offer products that help them
become better.
Make sure your marketing also reaches parents of Gen Y, for
they are close to their children, and still buy things for them.
Source: refresher.com
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Generation Y Places High Value On…
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Connection
Diversity
Living first
Time with friends
Civic activities
Taking care of the environment
Authenticity
Quality
Access to information
Ongoing learning
Career development
Freedom to travel
Source: Marketing to Generation Y: What You Can’t Afford Not to Know, by Bea Fields, 12/25/2008
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Communicating with Gen Y
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Know that there are more media outlets for Gen Y to be aware of,
and there are more opportunities for advertisers to reach them.
Create effective communication via events, the Internet (instant
messaging), blogs, sponsorships, billboards.
Plan strategically targeted messages.
Follow the grassroots approach, and promote products at places
teens gather.
High-pressure selling is out. These consumers are used to buying
online- without pressure.
They research the Web. They understand transparency in prices and
technical information- don’t talk down to them in the technical
terrain.
Associates have to know more than these consumers have learned
about the products on the Web.
Source: brandchannel.com
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Generation Y Replacing Generation X
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What this means is that the purchasing power is going to
be largely transferred from Baby Boomers, who are
retiring, down to their children and grandchildren.
Generation Y was born with a cell phone and a laptop in
their crib. To be “plugged in” 24/7 has almost become a
natural extension of their being.
This is the most optimistic generation to ever walk the face
of the planet. They care about the earth and servicing theit
community.
Source: Marketing to Generation Y: What You Can’t Afford Not to Know, by Bea Fields 12/25/08
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Gen Y Consumers Are Optimistic
About Future
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According to a survey by StrategyOne for Pepsi in
November 2008, people born 1980-1990 remain
confident about the future despite the falling economy.
Four out of five Millennials are hopeful about 2009.
95% agree that it is important to maintain a positive
outlook on life.
77% have a strong sense of optimism about their
careers.
74% find that supporting causes makes them feel more
optimistic.
Source: Center for Media Research, MediaPost 12/31/08 (Latest data available)
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So, How Do We Market To Gen Y?
In order to successfully market to Gen Y, we must first
recognize the four areas Gen Y considers before
purchasing a product or service:
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Cheap cost
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Good quality
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Fast service
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An “experience”
Source: Marketing to Generation Y: What You Can’t Afford Not to Know, by Bea Fields, 12/25/08
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Where Can We Reach Gen Y?
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Concerts (Gen Y loves live music).
Extreme sporting events (skateboarding, snowboarding,
BMX).
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Movies
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Hiking events (Gen Y love the outdoors).
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Video games and video game competitions
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Mashups
Source: Marketing to Generation Y: What You Can’t Afford Not to Know, by Bea Fields 12/25/08
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Spending Patterns of Gen Y
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Gen Y currently spends over $200
billion, and they drive many adult
purchasing decisions.
Source: Fast Company Magazine 6/19/08 (latest data available)
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General Gen Y Expenditures
Average Annual Expenditures
Under 25
25-34
Food and Alcohol
$4,895
$6,720
Housing
9,975
17,218
Apparel and Services
1,351
1,965
Transportation
5,464
8,699
682
1,737
Entertainment
1,608
2,766
Personal Insurance and Pensions
2,283
5,510
427
1,036
1,691
759
949
1,650
$29,325
$48,159
Health Care
Cash Contributions
Education
Miscellaneous
Average Annual Expenditures
Source: U.S. Department of Labor, Bureau of Labor Statistics, Consumer Expenditure Survey, 2008. Cited in MetLife Mature
Market Institute.
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U.S. Total Annual Income by Generation,
2007, 2012 & 2017 (Trillions)
$1.89
$2.37
Generation Y
$3.48
$3.67
$3.91
Generation X
$4.20
$3.44
$3.29
Baby Boomers
$2.96
2017
2012
2007
Source: Javelin Strategy & Research cited in eMarketer 11/3/08 (Latest data available)
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Gen Y Advertising & Brand Preferences
The College Explorer survey of college students ages 18-30,
conducted by Alloy Media & Marketing revealed:
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41% of respondents prefer socially responsible brands.
Important issues for determining socially responsible
corporations (69% of respondents) were donating money to a
cause or charity or using eco-friendly business practices.
68% said the criteria for socially responsible corporations was
fair labor practices, 46% said supports diversity in the
workplace.
49% said that social messages incorporated into advertising
have an effect.
93% say they are less likely to ignore an ad that promotes a
brand’s partnership with a cause.
Source: Alloy Media & Marketing.com 8/4/08 (Latest data available)
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Gen Y New-Car Buyers Seek Vehicle Safety,
Security and Durability
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Strategic Vision’s New Vehicle Experience Study
shows that Gen Y is not that different from older car
buyers.
79% of Gen Y buyers said their most important
considerations are safety, security and durability
rather than how fun a new vehicle is to drive.
40% of Gen Y buyers said they definitely would buy
Toyota, and 36% said they same of Honda.
Gen Y consumers constitute about 10% of the total
new-vehicle market.
Source: MediaPost Publications 10/30/08 (Latest data available)
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Gen Y Are More Likely to Make Their Own
Investment Decisions Than Other Generations
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According to Scottrade, an online investing firm, 51% of Gen
y makes their own investment decisions compared with 40%
of the total population.
Only 5% of Gen Y has someone else making their investment
decisions, compared with 10% of the total population.
34% of Gen Y investors say their investment decisions are
better than average, compared with 25% of the total
population.
79% of Gen Y investors are using financial websites to get
information, compared with 48% of the total population.
Scottrade is enhancing educational components of its online
offerings for the Gen y consumer, and anticipating more
mobile investing.
Source: Marketing Daily, MediaPost 11/12/08 (Latest data available)
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Gen Y Driving the Trend for
Environmentally Friendly Clothing
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Research from Iconoculture shows that 20-28-year-olds are
willing to pay more for organic and fair-trade products.
Iconoculture’s research describes four distinct shopping types:
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The Living Green consumer who has embraced the concept of
the environmental lifestyle and is driven by dedication, purity
and awareness.
The Core Fashionista who is looking to build up the green in her
fashion portfolio and redefining her sense of eco-chic.
The Walking Green consumer who is driven by wanting to
belong to a greater community and is a trend follower.
The Spending Green shopper who buys green clothes because
that sense of exclusivity and entitlement are important to her,
and buying green connotes luxury.
Source: MediaPost Publications 4/7/08 (Latest data available)
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Media/Technology Usage
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The Media Consumption of College Students
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According to conclusions from Alloy Media + Marketing’s
9th annual College Explorer Survey, anticipated annual
technology spending among college students (ages 18-30)
has reached an all time high at $6.5 billion, ranking 3rd in
overall discretionary spending.
The study found that students are spending an average of
12 hours daily engaged with some type of interactive
media.
Additionally, students are spending twice as much time on
their computers as compared to television viewing.
Source: Alloy Media + Marketing 9th annual College Explorer Survey
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The Media Consumption of College Students
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33% of 18-24 year old students have increased their
consumption of webisodes or user-generated videos since
last year.
30% of 18-30 years olds report frequent video viewing on
social networking sites.
61% of students are watching movies on computers vs.
76% on their television.
Source: Alloy Media + Marketing 9th annual College Explorer Survey
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College Students Adopt New Technologies
to Engage, Connect and Entertain
Alloy Media & Marketing’s 8th College Explorer survey
of college students ages 18-30 revealed:
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Seven in ten students now own a laptop.
The college student, on average, consumers 1.9 hours of
MP3 usage.
5.0 hours of computer contact.
Growing numbers of students use their cell phones for
communication, entertainment and web access.
Source: Alloy Media + Marketing College Explorer, 2009
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Generational Differences in Online Activities
Online Activity
Gen Y
Gen X
Younger
Boomers
Watch videos
Buy something
Use social networking sites
Make travel reservations
Get info about jobs
Send instant messages
Download music
Bank online
Play games online
Read blogs
Download podcasts
Create a blog
Visit a virtual world
72%
71%
67%
65%
64%
59%
58%
57%
50%
43%
25%
20%
2%
57%
80%
36%
70%
55%
38%
46%
65%
38%
34%
21%
10%
3%
49%
68%
20%
69%
43%
28%
22%
53%
26%
27%
19%
6%
1%
Source: Pew Internet & American Life Project, Generations Online 2009 1/28/09
Older
Boomers
30%
72%
9%
66%
36%
23%
21%
49%
28%
25%
12%
7%
1%
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Thank You!
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