5 Ways Millennials Are Changing Your Marketing Strategy
In the United States alone, Millennials spend about $600 billion a year, which Accenture projects will increase to $1.4 trillion — or 30 percent of all retail sales — by 2020.
For B2C marketers, Millennials represent incredible opportunities and challenges. The first digital natives, Millennials are more tech savvy than their predecessors, and are more skeptical of traditional advertising. They are also more open to brand advocacy, with 50 percent activelysharing their brand preferences with friends online.
To successfully meet the needs of this generation, marketing strategies will need to adapt. Here are five marketing trends you can expect to see as Millennials increasingly flex their purchasing power.
1. Mobile First, Mobile Everything
How much of an impact has mobile had on the way we consume content? Consider that during prime time TV hours, YouTube’s mobile site gets more eyeballs than any cable TV network. Not only do 7 out of 8 millennials own a smartphone, but 51 percent of them access the internet from their device “all or most of the time.” A full 49 percent say they use their smartphones to make purchases as much as they use any other platform.
Smartphones are the tools that power millennials. So if your mobile strategy only extends as far as a mobile-enabled website, you will struggle to truly engage.
Mobile is powerful because it facilitates personalized engagement — which is what millennials expect from their favorite brands. Whether you’re leveraging mobile applications to drive loyalty, or sending text-based coupons to customers while they’re in the store, taking a thoughtful approach to the mobile channel is essential for driving engagement — and dollars — from millennials. Starbucks is a company that has done this incredibly well, driving up to 30 percent of all payments through mobile.
2. Real Life Engagement.
Over the last fifteen years, the percentage of budget spent on digital and mobile marketing has only increased. Therefore, it’s somewhat ironic that the next generation of shoppers are taking marketers back offline.
While having a strong, integrated online presence is table stakes, today’s consumers came of age in a world where mobile apps and social media were the norm. Not surprisingly, millennials aren’t impressed by display ads, can quickly filter marketing emails out of their inboxes and are experts at using AdBlocker.
So with online conversion rates hovering around 1 percent, how will marketers reach millennial consumers? By focusing on marketing campaigns that capture the imagination of millennials in real life, in a way that drives engagement online.
Millennials report valuing “experiences” more than any prior generation. 72 percent say they would like to increase their spending on experiences rather than physical things in the next year, and 60 percent said that experiences are an important part of connecting to other people. This preference for real life experience is equally important when it comes to shopping for products, with the majority of millennials still reporting that touching, smelling, and interacting physically with products is an important part of the purchase decision.
Tapping into this desire to have — and share — real life experiences can be a huge win for marketers. Focusing efforts on in-store engagement, and the ability to create emotive, engaging, interesting real life experiences, is an excellent strategy for capturing millennial interest and marketshare.
3. Philanthropy As a Brand Tenant
Because fifty percent of US Millennials believe that brands say something about “who I am, my values, and where I fit in,” it’s no surprise that millennials expect a higher level of integrity, accountability and sustainability from brands than any prior generation.
Millennials are used to living in a world where brands can make an impact — and even take political stands. Companies like Uber get flamed for bad behavior, and a host of fast-growing companies — like Warby Parker and Toms — have found incredible success by building their brand on philanthropy.
Almost 50 percent of millennials say they would be more willing to make a purchase from a company if that purchase supports a cause; for companies that already “do good,” this is a huge opportunity to highlight your efforts. Many of the biggest brands — like Walmart, Bank of America, and Google — have increased investments in philanthropic efforts over the last few years, and many more are beginning to highlight good works as a core part of their brand.
While corporate responsibility may not have been a way to customers’ hearts in the past, finding ways to highlight your charitable efforts will go a long way in attracting attention and loyalty from the millennial consumer.
4. Increased Focus on Customer Loyalty
Retaining customers has always been a challenge for marketers, but millennials are less brand loyal than preceding generations. Only 29% of millennials say they usually buy the same brand, which is a 7 percent drop from their Generation X counterparts. With decreased startup and online marketing costs, competition is fierce — and Millennials know it’s a shopper’s market.
95 percent of millennials say they expect brands to proactively court them, and they expect brand relationships to be personalized, targeted and ongoing. This means that your ability to track the entire customer journey across a variety of segments — and meet customers at every stage — is more important than ever before.
Once you know how and where your customers prefer to shop and buy, purpose-built mobile applications and segment-specific loyalty programs can help you stay top-of-mind, and deliver value at all times. Sephora’s Beauty Insider program is a great example of this, and its program is frequently praised by customers and B2C marketers alike.
5. Content is Shorter, Faster, Integrated and Live
When it comes to millennials, consistent and prepackaged brand messages are a recipe for disaster. Millennials eschew produced and overly packaged content for “real life “content with 43% saying they value authenticity over the content itself.
Millennials are multi-taskers with an advance degree in filtering out noise, and they expect advertising to be entertaining and useful. Live stream, photos and video are their preferred content format, and anything that allows millennials to interact — like quizzes and games — will see better conversion rates.
While it can be a challenge to keep up the rapid pace of new, engaging, and authentic content your buyers demand, the good news is that customer conversion no longer requires marketers to spend thousands of dollars — and several months — to create content. With the launch of Facebook Live, and the integration of livestream into Instagram’s Stories, it’s easier than ever to rapidly generate content, and, as many brands have discovered, consumers are more than happy to help you generate content.
The Bottom Line
Millennials present a variety of new challenges and opportunities for marketers. As the need for rapid-cadence content creation increases, and mobile becomes the device of choice, tactics will change. But millennials are more than happy to engage with your brand — and live events, and buzzworthy in-store strategies will go a lot further with this generation than before.