Is your small business marketing to Generation Y consumers? If not, you probably should be. Consider the numbers: There are 79 million of them in the U.S., according to 2011 figures, and by 2030, they will outnumber baby boomers (at 56 million).
Members of Gen Y, also known as "millennials," either spend or influence the spending of hundreds of billions of dollars each year. As this generation grows into its peak earning years, its spending power will only increase.
A new study identifies core generational differences. The comprehensive research by the Boston Consulting Group (BCG), Barkley and Service Management Group (SMG) is valuable because it's not limited just to the life-stage disparities between generations.
Here’s some of what the study found about the generational differences that will last, and what it means for your small business.
Although the generations spend about the same amount of time online, millennials are more likely to use the Internet as a platform to express their thoughts and experiences. They contribute user-generated content, like blog posts or videos. Pay attention to what they’re saying, and you’ll gain valuable information you can use to market to them more effectively.
Gen Y is far more active in rating products and services (60 percent versus 46 percent of other generations). Make sure your business has a presence on ratings and review sites like Yelp. Pay attention to what’s being said about you, and engage and respond appropriately.
I’m Late, I’m Late
Young consumers are always in a hurry, so convenience, simplicity and speed are crucial for their transactions. Don’t make them read a lot of text to get what they want on your website, or slog through an endless voicemail menu list. Design your transaction process so they can get in, get what they need and get out quickly.
Caring for Causes
Gen Y is receptive to cause marketing. They are more likely to purchase products when their dollars help support a cause (37 percent versus 30 percent). If your product lends itself to cause marketing, this could give you an edge.
The New Experts
Recommendations from “experts” don’t mean much to this generation. They rely on recommendations from peers or friends. Engaging with satisfied customers on your Facebook page or Twitter account is a more effective way of spreading the word among these young consumers. They are more likely than other generations to explore brands on social networks (53 percent versus 37 percent).
Millennial consumers like to use their mobile devices to make purchases. They’re also more likely to read user reviews and research products on their devices while shopping (50 percent versus 21 percent of non-millennials). If your e-commerce website isn’t mobile-friendly, you’re missing out.
Social media is core to millennials. Nearly half (47 percent) say their lives feel richer when they’re connected to people through social media. Only 28 percent of other generations feel this way. Gen Y consumers are more likely to explore brands on social networks (53 percent versus 37 percent), and more likely to buy from brands that have Facebook pages.
Short Attention Span
Millennials are much more likely to multitask online. I don’t mean just switching from one window to another, but constantly toggling back and forth between platforms and devices.
Marketers have to work harder to capture their attention. You have to engage with them on each platform, because you never know where they’ll be.
Understanding attitudes of millennials may require some attitude adjustments of your own. BCG notes that many marketers have a dismissive attitude toward this young generation. If that’s you, get over it.
Today’s young consumers are already influencing how older generations spend. And soon, they’ll be tomorrow’s older generation.
How are you targeting millennials in your business? What’s working for you and what isn’t?
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