So asked a recent client of mine when we were (yet again) talking about how to reach millennials.
When marketers talk about reaching millennials, they are talking about reaching people born between 1982 and 2000. In the USA, this group represents more than one-quarter of the population (or 83.1 million) and is larger than the baby boomer group of 75.4 million . Collectively, millennials in the USA spend $200 billion each year.
Our fascination with millennials is not so much with... well, millennials, but with what they represent. At a quarter of the population, this group is certainly too large to ignore. Since millennials currently represent those aged 14-32, I suggest we split the group in two:
1. Younger millennials (ages 14-24) - I will call this group "The Apprentices"
o Most of this group is still pursuing an education. Those aged 14-18 are probably in high school and 75% of those aged 18 - 24 are in college.
o Because this group is mostly still in school, the group is likely to rely on other sources of funds such as parents and student loans. Younger millennials are also likely to work full or part time but will not earn a lot of money.
o Younger millennials buy products for themselves. This group will use brands to reveal their own identity.
o This group also pays attention to what their parents buy and so brand preferences for later purchase decisions will also be formed. This is why I call them Apprentices.
2. Older millennials (ages 25-32) - I will call this group "The Freshly Minted Grown Ups":
o By the time this group has reached 25, half of the 75% who entered college will have graduated. Many will have had their first child - the average age for first time mothers is 26 but this rises to 30 for college-educated women ; married (average age 27 for women and 29 for men (although 49% of all those aged 25-34 have never married ). Older millennials haven't quite purchased their own home as the average age of a first time homebuyer is 33 .
o The data gets a bit patchy here - median incomes for those with a college education is $45,500 (vs. $28,000 - $30,000 without a college education); and 1/3 of college graduates return to live at home. But a defining characteristic is that older millennials strive for financial independence from their parents.
o Older millennials make their own brand choices across a wide range of product categories from products for themselves (fashion and accessories, health and beauty, entertainment, etc.), to products with others (weddings, setting up a home), to products for others (babies and partners). This is why I refer to this group as the freshly minted grown ups - they have finally graduated to adulthood.
Therefore, the first reason to pay attention to millennials, especially older millennials, is that this group is interacting with a large number of product categories from cars to financial services to furniture and appliances to wedding planning to baby items to entertainment to clothing and personal services. Older millennials are finally making their own brand choices - brand choices that are free from parental influence. The brands that help older millennials transition into contemporary adulthood will be the brands that older millennials likely stay loyal to for years to come. There are not that many other age groups that interact with so many product categories.
A second reason to pay attention to millennials is that they replace aging customers who need to be replaced if the organization intends on surviving.
A third reason to pay attention to millennials is that most Chief Marketing Officers (CMOs) are not millennials themselves. Even if CMOs have children or nieces and nephews who are millennials, millennials can feel a bit mysterious. To understand millennials means to stay current with: (1) cultural and social trends, (2) brand messages that matter to millennials, (3) brands that celebrate the fact that millennials are making an independent choice and not choosing a brand because their parents purchased the brand, and (4) technology and how this changes the customer experience and provides new ways to engage with and reach customers.
Will we still target millennials when they are 75? YES if we are interested in products for seniors but NO if we are interested in a group of consumers who are forming lasting relationships with brands from organizations that want to remain contemporary to our freshly minted grown ups. Maybe we should stop referring to the 25-32s as millennials and instead call them marketers' butterflies - a group of engaged and active consumers who have finally emerged from the pupae that have protected them for so long.
Our next butterflies will be younger millennials - i.e., our current apprentices, and this group will followed by Generation Z. My point: a sustainable organization needs to pay attention to a pipeline of consumers, what matters to them, and how to connect with them.