Marketing to Demographic Generation Y

You can think of the tech-savvy generation Y as bratty, iPad-wielding hipsters looking for eco-friendly alternatives. Born between 1980 and the early 2000s, Generation Y seems poised to be the next big consumer and marketing target group. After all, they will quickly become the predominant generational group within the primary home buying age. While the 25+ portion of Generation Y will grow significantly over the next three years, their anticipated economic contribution and outcome will not be seen until 2015 and beyond. Generation Y is also known as Millennials.

To understand this marketing group, you first need to understand what constitutes its psychographic makeup:

1. Economic influence and age distribution: Generation Y is currently between the ages of 16 and 32 and represents a substantial and important economic influence that will affect business and marketing trends in the next decade. The following table represents the percentage of the population of Generation Y in 2012 compared to 2017. In 2012, Generation Y is 29%, Generation X is 42%, and Boomers are 29%. In 2017, Gen Y is 44%, Gen X is 41%, and Boomers are 15%, a dramatic shift in demographics.

2. Technology: 90% have a computer and 82% have a cell phone. They rely on technology for relevant information and entertainment.

3. Wealth: Generation Y said being wealthy was very important to them, this rose from 45% for Baby Boomers to 70% for Generation X and 75% for Millennials.

4. Politics: The percentage who said it was important to keep up with political issues fell, from 50% for Boomers to 39% for Generation X and 35% for Millennials. Political issues are a distraction for Gen Y, as long as their world is intact, they care little about what happens on the political front.

5. Philosophical Perspective: “Developing a meaningful life philosophy is not important for this group,” this further decreased, across generations, from 73% for Boomers to 45% for Millennials. Individualism is paramount with Generation Y compared to conformity with previous generations.

6. Environment: “Get involved in programs to clean up the environment” dropped from 33% for Boomers to 21% for Millennials. Gen Yers want their environment to be clean of toxins and pollutants, but they want someone else to do the effort.

7. Competitive Drive: Gen Ys are “Trophy Kids,” a term that reflects the trend in competitive sports, as well as many other aspects of life, where mere participation is frequent enough to earn a reward. This has been reported to be a problem in corporate settings because individual achievement has been mitigated. Some employers are concerned that Millennials have too high expectations in the workplace. Studies predict that Gen Y will change jobs frequently, occupying much more than Gen X due to their high expectations.

8. Maturity: Millennials are sometimes referred to as the Boomerang Generation or the Peter Pan Generation, due to members’ perceived penchant for delaying some rites of passage into adulthood. Much longer periods than most previous generations. These tags were also a reference to the trend of members living with their parents for longer periods than previous generations.

9. Religion: Gen Yers are less likely to practice organized religion than previous generations, and more likely to be skeptical of religious institutions.

10. Debt: Generation Y is saddled with student loan debt and will be less likely to emerge as a substantial economic powerhouse until this debt is reduced.

11. Culture: Generation Y is putting off important life decisions, like marriage and starting a family, compared to previous generations.

12. Generation Y are corporate and political skeptics who believe that big business will have a staggering negative impact on society as a whole. Its appeal, from a marketing standpoint, will be to ditch corporate branding, which is a turnoff for this group, in favor of more niche and personal brands.

There will be growth at the younger end of the age spectrum as Generation Y reaches the mainstream of the household. Marketing to this demographic is going to be challenging as their mindset approaches because they are radically different from previous generations, as evidenced above. By 2017, they will comprise 44% of the economic influence in the US. Furthermore, since 1980 the number of Hispanic households has grown 5 times faster than the rest of the population. 70% of the net growth in the US population is the result of immigration, with 50% coming from Hispanic immigration, a trend that is likely to continue for the next two decades.

By 2015, nearly half of the population under the age of 25 will be non-white (45%), and the effects of this evolution have touched every aspect of our daily lives and will continue to change the landscape of America. Generation Y will be highly interconnected where nothing is private; texting is her primary means of communication, verbal communication skills have diminished to the point of being a lost cause. They place a high level of importance on individualism, self-actualization, and narcissism.

What is there to learn and how do you structure your marketing strategy for this emerging demographic? Consider the following areas of marketing emphasis:

1. Vision starts with a clear understanding of the future, 2015 and 2017 are not that far off, structuring your sales and marketing plan today to target this demographic will require some creative thinking.

2. Generation Y won’t start making any measurable economic impact until 2015.

3. Put your ad dollars into social media and technology to engage Gen Y, where they’ll look for your message. Commitment: A Gen-Y member rarely goes offline. Build relationships on the social networks they frequent, and don’t forget to optimize your website for interactive discovery.

4. Loyal Customer Relationships: Find the right balance between giving too much and not giving enough. You want real Gen Y customers spending money, not good-time freaks looking for a freebie.

5. Traditional notions are unpopular with Millennials; they prefer cheap costs, good quality and a product experience.

6. Generation Y is transparent and narcissistic; your marketing message should be the same.

7. Ditch your corporate image and build brands specifically aimed at the expectations of Generation Y and the expectations of millennials.

8. Finally, understand that Gen Y is politically, competitively, and philosophically neutral, unlike anything you’ve encountered in the past.

9. Gen Y likes music (concerts), extreme sporting events (snowboarding, etc.), outdoors (hiking), movies and video art experiences, tattoos (36% have at least minus one).

10. Don’t forget to include Hispanic culture as part of your marketing strategy.

Consider which companies have been successful in marketing their product or service to Generation Y: Apple, Trader Joes, Red Bull, Jet Blue, to name a few. These companies offer a good product or service at an affordable cost. Look at your marketing campaign and consider the dynamics of your messaging and presentation, for example, Apple hit the nail on the head with $0.99 music downloads.

So what does all this mean to you?

It means you can’t market them directly until you buy them, until you appreciate their outlook on life, even if it’s radically different from what we’re used to seeing. So while other experts are out there giving you “tricks” to market to Gen Y, I’m here telling you to STOP marketing to them and START listening to them. Understand their unique culture, accept it, and hang out with them. Experience life with them. Respect them. If you do, your outlook on life will change you and your company. You will begin to behave differently, take on some new values, and begin to live more yourself. When you do that, you’ll find your audience within this Gen Y demographic.