Millennial Marketing

I attended two conferences in June, the iMedia Brand Summit in Miami and the Edelman New Media Academic Summit in New York. The titles of these conferences sound a lot alike, but the focus of the two events was entirely different.

I struggle to find the right language for describing the difference, as both are part of the big umbrella known as ‘online marketing’. Perhaps the safest way to describe the differences is that one event was more focused on influencing consumer behavior and attitudes while the other was focused on influencing consumer public engagement or conversation.  The first event was more about paid media while the second was more about content and journalism. Social media, however, was a key topic at both.

Attending both events back to back served to highlight an important debate: Is social media part of ‘digital marketing’ or is it an extension of ‘public relations’?

The question is not an insignificant one. If social media is an extension of online consumer marketing in the tradition of online advertising, SEO, and email marketing, it will have a different set of tools and practitioners than if it is an extension of the traditional public relations platforms for communicating with ‘stakeholder’ groups, only some of which are customers.  It has implications for how (and in what department) we teach social media and the skills required to manage it on behalf of clients.

Even more significantly, how a firm answers this question for itself has important implications for organizational structure, agency relationships, brand ownership and resource allocation. Is social media a corporate function or a brand building function? Are its goals primarily reputational? Or are they intended to drive loyal customer behavior and sales?

Two new reports issued this week suggest marketers are struggling to use social media as a means of driving business results.

McKinsey Quarterly Report, “Unlocking the Elusive Potential of Social Networks“

There is much hype about social networks and their potential impact on marketing, so many companies are diligently establishing presences on Facebook, Twitter, and other platforms. Yet the true value of social networks remains unclear, and while common wisdom suggests that they should be tremendous enablers and amplifiers of word of mouth, few consumer companies have unlocked this potential. At Liberty Interactive, which comprises many specialty e-commerce companies, we wrestle daily with the question of how to realize the promise of social networks.

Digital Brand Expressions: “Social Media Without a Parachute” June 2010

While 78% percent of (businesses surveyed) said they are using social media, only 41% of them said they have a strategic plan in place for their social media usage, leaving close to 60% without a game plan for their social media activities.  Seventy-one percent of respondents with a plan (71%) indicate they use social media for public relations communications, and 55% say that they use social media for sales-related activities. Only 16% say their HR team is using social media for recruiting, employee retention, training and development, etc. Just 26% use it for customer service.

Until recently, there has been little research on the ‘value’ of a ‘fan’. Syncapse recently published what I believe is the first economic case for gaining fans or followers on Facebook. The research shows fans are more valuable than non-fans (control group) in terms of purchasing, loyalty and propensity to recommend. Yet results varied widely by brand. At an average lift of $72 per fan, one still has to question the value of a fan in purely economic or ROI terms.

In some ways this debate – PR vs. online marketing –  simply aggravates a debate that has been going on for a long time, that is ‘who owns the brand’? Or phrased another way, who has responsibility for building brand equity?

Traditionally this has been the role of the brand manager or CMO.  The strategies for creating and sustaining brand relationships were originated in the brand group and coordinated through marketing, primarily with the assistance of a general purpose advertising agency supplemented by specialty marketing firms.  Marketing PR (MPR) was part of the integrated approach, but rarely lead the parade, unless the consumer and corporate brand were one in the same. Corporate brands or ‘reputation’ issues were handled at a different level and often worked closely with PR firms.

However, with social media the lines are becoming blurred. Where the brand starts and the corporation begins is not as clear as it once was.  Brand issues on social media can quickly become corporate ones, as companies involved in recalls or customer service issues have learned. There are nagging questions of who is empowered to speak on behalf of the brand and the risks of saying too much.

What concerns me about the debate about where social media fits is the potential for it to become disconnected from marketing.

Indeed, it was telling how seldom the word ‘marketing’ came up at the New Media Summit. The Gen Y marketers from Edelman who participated in a panel discussion revealed that they wished they had learned more about ‘business’ during their college careers.  However, they readily shared that they do not think of themselves ‘as marketers’ but as something ‘bigger than marketing’ – the corporate reputation or brand. (Huh?) In contrast, the Gen Y digital marketers I speak with who are active in SEO, email marketing, web site design, etc. think of themselves as marketers.

Richard Edelman proclaimed at the New Media summit that PR is now ‘the organizing force’ for public engagement’, in that PR provides the ‘galvanizing ideas’ that forms the ‘runway’ for other efforts, rather than something that ‘piggybacked’ on content and ideas created by advertising.

“We should aim for measurable outcomes beyond media impressions and advertising equivalencies, including Building Trust, Changing Behaviors, Deeper Communities and Delivering Commercial Benefit. At the same time we must draw a clear line between journalism and public relations, as we rely on a discerning media sector as a cornerstone of our work. We will proceed along two dimensions—to encompass a broader set of media options, from Mainstream to New to Social to Owned; and engage stakeholders in deeper, long-term social relationships, as all communications become public. In this way, PR can assume its proper role as the organizing principle for strategy and communications. – Richard W. Edelman, “Public Engagement; The Third Way”

Like advertising, direct mail or traditional PR, social media is a way to get attention for your brand, engage customers and to build brand relationships. But unlike advertising, direct mail or traditional PR, it is not clear yet how to effectively link social media strategy to brand strategy. If a brand is going to have a conversation with customers, the brand strategy needs to specify what that conversation is about and its purpose.  Furthermore, brand conversations are not  free, so they will have to be paid for out of dollars that could be allocated elsewhere. That means those dollars ultimately will have to be accountable for more than simply generating goodwill.

I don’t have the answers, but I think the question is one worth pondering. If social media is primarily a means for engaging stakeholders, only some of whom are customers, in conversation that builds brand reputation, then it is more of a corporate function and PR should lead. However, if social media is a brand engagement tool for driving deeper relationships that result in tangible returns, then it is a marketing function.

If the answer is both (and according to the Brand Expressions research, this is the most likely answer) then processes will need to be developed that help marketers and communications managers define objectives, allocate resources, clarify responsibilities and develop processes for making the most of  social media.

Yesterday I shared portions of a remarkable Twitter chat among 45 Gen Y’ers on the topic of the “American Dream”.  Today, I’m going to share the rest of that conversation where they discussed what it means to have a good life.  The conversation took place over an hour using the hashtag #genYchat and included contributions from 45 different people.

The overall take away is that while Millennials still relate strongly to the idea of a “dream” of limitless possibilities, they also are in the process of redefining those possibilities in a less material and more experiential/personal way.

Some of the redefinition is a rejection of what they in the lives of their parents. Some is simply part of a deeper desire to make a meaningful difference in the lives of others, the nation or the world. Many defined success in terms of affirmation from peers, others defined it in terms of greater satisfaction from work or ‘happiness’.

@GenyChat: Q2. Do you believe that there are generational differences in how personal and material success are defined?

@kelly_ashworth: Absolutely! I think GenY will be less focused on $ which failed for many of our parents and more focused on happiness.

@malapropicninny: Heck yes. As GenY, I’d like to have a nest egg, but if I’m working & doing something I love, I don’t mind the lifelong grind!

@josippetrusa: Definitely, how gen-y appears to the world both online and in person “defines” our perceived success

@steve_campbell: Definitely. Gen Y doesn’t necessarily care about following a set path to find happiness.

@Outlaw_Inc: Yes. GenY’s success = having the freedom and flexibility to pursue passions, have great experiences.

@steve_campbell: I’d say we definitely worry about our future less than our parents do Not to say we don’t care, but we’re not overly worried

@NahumG: Let’s see..if the American Dream is supposed to be living on your own with a career and great family I’m on my way, but it’s taking a LOT longer than I thought it would take to get there.

@E_Hanson: We’re more focused on doing what truly makes us happy and experiencing everything we possibly can.

@steve_campbell: I agree. Experiences seem to be a bigger part of our lives.

@niltiac: Definitions of ‘success’ have changed over time. The Baby Boomers who started that process, Gen X and Y continue it.

@kelly_ashworth: I think we have a belief that it will work out, and we’ll figure it out along the way… ties into our optimism

@WriterChanelle: Are those the trappings of success for us, though? I just want a place of my own and a car.

@josippetrusa: Not so much a trapping of our own but something that we have put into believing

@GenerationMeh: Interesting! I see a lot of worry/angst/second guessing, maybe more about self-worth than $, though.

@daniellewriter: For me, success is liking my job, not how big my paycheck is.

@steve_campbell: Familiarity with technology helps with our vision of how the world works too, which lessens worry

@josippetrusa: When someone RTs an article I’ve written, that’s what I see as “successful”

@WriterChanelle: *Deep sigh* YES!! I’ll take a Google Alert with my post showing up over a BMW

@TylerDurbin: Amen!

@josippetrusa: When you [@WriterChanelle] notified me that one day when my article came up, biggest smile ever!!

@WriterChanelle: It’s GenY’s “having your name in lights” re: Google Alert

I’m particularly fascinated by the last few remarks as they are less about ‘fame’ than about affirmation. Your name in lights re: Google is not exactly the world’s definition of success, but it appears to be a meaningful yardstick for these Gen Y’ers.

Last week, Jenny Blake, the blogger behind “Life After College” announced in her blog that she had landed a book deal. The excitement was contagious. Here’s how she described her feelings a few days later. Note the focus is on her immediate ‘supporters’ – one senses this is the group that truly matters to her:

I feel like the luckiest girl in the world. Partly because of the book deal, but partly because I got propped up by a small army of support these last two weeks by having all of you celebrate with me. Every tweet, text, email, call, facebook note, hug and high-five just filled me to the brim with gratitude. This book finally feels real — thanks to you.

Experiences are better when they are shared.

I think of Jenny’s response as quintessentially ‘Millennial’ – team oriented, collaborative and authentic. For marketers, this insight could be potentially quite profound. Social media is not just about ‘communicating’ with friends, it is about ‘connecting’.   Marketers who provide affirmation, as well as information, will find it easier to fit into the lives of Millennials and their idea of success.

How can your brand provide the ‘high fives’ and ‘five minutes of fame’ Millennials value?

Millennials are different from other age groups and from other generations at the same age in three ways.

More diverse demographically

More at ease with digital and communications technology

More optimistic outlook

The third difference, ‘optimism’, may be their most defining characteristic Why?  Bcause values ultimately guide and predict behavior.

Pre-recession, study after study in the U.S. and globally, reported that Millennials may be the most optimistic generation to date. And why not? Born into a period of unprecedented prosperity, into child-centric families who regarded children as minor royals, and into a period of exploding technology, Millennials are endowed with an unprecedented sense of empowerment. For these children of the new Millennium, anything is possible.

A fascinating book by Clotaire Rapaille, The Culture Code, describes the power of the American Dream this way: “We’ve built our [American] culture on dreamlike stories that, amazingly, are true.” It is this faith in the possibility of dreams that makes America so influential in the world. Who wouldn’t want to believe that anything is possible, that mistakes are simply ways we learn and precursors to eventual success?

For Millennials, the American Dream is very much alive, even in the midst of the Recession.

Pew Research has been tracking attitudes of Gen X’ers and Gen Y’ers for many years. They recently reported that “Today’s employed young people are actually somewhat more optimistic about their economic future than Gen Xers were when they were young.” (“Millennials Confident. Connected. Open to Change”, February 2010) Even more startling, Pew found the overall level of optimism among Millennials about their personal economic future today is higher than it was in 2006!

“Even though the recession has been hard on young people, it has not dimmed their optimism. About two-thirds of Millennials (68%) say they are not earning enough money to live the kind of life they want. However, within that group the vast majority (88%) say they expect to earn enough in the future to live the good life. That is significantly higher than the percentage of Gen Xers (76%) or Baby Boomers (46%) who share this hopeful view.”

The same pattern holds for their optimism about the overall state of the nation. While their opinion has held steady, dissatisfaction among older consumers means the gap between generations is wider than it’s been in 20 years due, at least in part, to widespread dissatisfaction among those 65 and older.

What does the American dream mean to a Millennial?

This question was asked last week in a fascinating Twitter Chat hosted by a member of our Gen Y Marketers “Super Community”, Chanelle Schneider (aka @writerchanelle and  @genYchat) and co-hosted by J. Maureen Henderson (aka @generationmeh). The discussion evoked 436 tweets from 45 contributors. The responses suggests the concept of ‘dream’ is one that Millennials strongly relate to.

@GenYChat: What ideas or associations does the term “American Dream” conjure up for you?

@tylerdurbin The American Dream is having the freedom to explore any and all opportunities we desire. ‘Nuff said. Chat over.

@josippetrusa: Gen-Y is reinventing it. Gen Y is a generation based on dreams.

@WriterChanelle; American dream is freedom and opportunities

@nahumg: GenY wants to live dream lifestyle now rather workin a lifetime to get it

@tylerdurbin: If we work now can we not have things we want?

@daniellewriter: American dream is meritocracy-if you work hard enough, you cam have it all

@GenerationMeh: Great summation!

@kelly_ashworth: I think we have to fight harder and have more of a plan… opportunity is not there waiting & won’t just fall into place

@GenerationMeh: But what constitutes a “dream lifestyle”?

@josippetrusa: Depends, but gen-y would like a managerial job, a bmw and all the gimmicks of success.

@josippetrusa: The american dream has been changed to exemplify quick success that some have achieved from advances in technology. We are limitless.

@GenerationMeh: Idea of opp, potential & self-sufficiency as the ingredients for success is ingrained in American identity. Source of pride.

Tomorrow: How Gen Y is redefining the meaning of success.

Young people today watch more video in more different places other than traditional TV. This is hardly news.

Study after study has shown a dramatic shift, not in hours spent watching video, but where it is watched.

“Younger Viewers Watching More TV on the Web” – Retrevo 4.12.10 “According to a Retrevo “Pulse Report” of over 1,000 people regarding their TV viewing habits, 23% of people under the age of 25 watch most of their television content online compared with just 8% of people over the age of 25 watching most of their TV shows via the web.”

“Generation M2: Media in the Lives of 8-18 year old s” Kaiser Family Foundation Longitudinal research tracked changes in media use 1999-2009 via diary.  Loaded with great charts on total media usage and how it breaks out by medium over time. Total hours spent with media has increased by over 2 hours due to multitasking. TV accounts for 4 hours 29 minutes a day, but only 59% (2 hours 39 minutes) is watched live.

“How Teens Watch: The Future of Media is in Their Hands: Nielsen 6.16.10 “12-24 year olds are more connected, more tech savvy, and more likely to use personal devices such as smartphones, laptops and other gadgets for video viewing. They are also less likely to watch traditional television. Teens living at home tend to watch more TV overall than 18-24 year olds busy with college or their first jobs. But the “first screen,” TV, is less central to both.”

But will this behavior shift persist as Gen Y ages?

The Nielsen research raises some interesting questions regarding whether this pattern away from traditional TV and toward time shifted TV or third screen is age and lifestyle related or generational. This may seem like hairsplitting, but actually is important. If the behavior is age and lifestyle related, they may revert back to traditional viewing with age. If it’s generational, however, we’re seeing something more fundamental.

Nielsen suggests the changes may, in fact, be more due to age. But I think it’s generational.

Let’s look closer at the Nielsen analysis. This gets a little convoluted, but bear with me (it helps to look at the chart above as well).  According to Nielsen:

“The teens of 2001 watched less than 25 hours of television a week but by 2009 as they aged into 18-24s, they were watching 31 hours of television.

Even more dramatically, the young adults of 2001 watched less than 25 hours of television but watched more than 36 hours a week of television as they aged into the 25-35 cohort.”

This is compelling on the surface, but I think the comparisons are unfair. First, if you compare apples to apples –  P18-24 in 2009 vs. P18-24 in 2001 – you see that the total hours of viewing have increased from under 25 per week to 31 per week in 2009.  So the increase from P18-24 in 2001 to P25-34 in 2009 is consistent with the overall trend that indicates video watching in general is becoming more, not less, important.

Second, the Nielsen analysis doesn’t account for the fact that the media environment is exploding with options, making it difficult to predict how today’s 18-24′s will behave ten years from now.  If the pattern of increased television holds, they will watch more, but that does not necessarily mean it will be on traditional television.  ”Convergence” is something that has been predicted for a long time.  Given the dramatic changes in time shifted and third screen viewing by Gen Y, it may actually come true sooner than we think. In my opinion, the changes indicate a generational shift. Those in traditional television should take little comfort in the Nielsen analysis.

Yesterday I talked about how to get Millennials’ attention online. Now, let’s assume you have it, how do you keep it, given all the competition?

The Internet is a modern day three ring circus: there’s something cool going on everywhere you look. According to Comscore, 45% of all page transitions are ‘link following’. Every web page offers multiple enticements to move on. To create interest, you must say something worth staying with, in other words ‘relevant’.

Keeping Gen Y’s attention in an environment defined by distraction requires being ‘interesting’.

Gen Y blogger, Meg Roberts, wrote an article titled “How I would market to myself’ in which she offers this advice:

“Focus on adding value rather than overloading on content. The best way to ensure we’re listening to your messages is to make them relevant to us.  Learn why we’re in a given community, whether it’s Facebook or Twitter or an iPhone app, and speak to us without severely interrupting what we’re doing .”

Note the words “without severely interrupting”. When creating messages for Millennials, it’s important to ask whether or not the message meet the test of whether it’s worth interrupting.

If a friend wouldn’t interupt than a marketer shouldn’t either.

For Millennials, interruptions are the height of rudeness. There is a heirarchy of communications. A phone call is highly interruptive – and it’s little wonder that Millennials make very few phone calls. Phone calls are reserved for very important conversations, like telling your parents you need money or will be traveling to Puerto Rico rather than home for spring break. For less momentus communications, which is to say most communications, they rely on texts.  A teen sends hundreds of texts a day. Texts are less intrusive than phone calls and yet still has urgency. Email is even less intrusive than texts. Email is used when a message is not time sensitive or does not require an immediate response.

Is it Relevant, Cool or Exciting?

Another test for relevance is whether a communication is ‘status update worthy’. As Gen y marketer and community member, Josip Petrusa, puts it this way:

“One thing we love to do is tell the world when something cool, great or exciting is happening to us. In a sense, we love to brag for attention. You’ll always hear about the vacation we’re going on, the sports event we’re going to, the movie we’re seeing, the concert we were at and I could go on and on. Make it something that will give me a reason to tell everyone else about it. A funny and ridiculous video-clip, a great experience or something that even seems exclusive, would all be status update worthy.” You have to reinvent cool, great and exciting.”

What’s In It for Me?

There is a myth that Millennials don’t like advertising. Actually this isn’t true. They like ads that are entertaining or funny, especially for brands they already love. They love the iPad, Axe and current Kindle ads.  These are ads that give back something in return for attention.

The Associated Press (AP), a group with a vested interest in Millennials’ interest in news and ads, released a study in March that looked at ‘news ad fatigue’.  The study took an in-depth, ethnographic approach that focused especially on people 18-34. The research concluded that consumers are “tired, even annoyed, by the current experience of advertising,” and that, as a result, “they don’t trust very much of it“.

Younger consumers, ages 18-34, want to be in the know, and two thirds think it’s important to be among the first to hear news compared with just 10 % of older people. Millennial consumption of news is actually increasing. According to  Mckinsey the average person consumes 72 minutes of news a day, compared with just 60 minutes in 2006 and the increase was driven almost entirely by people under the age of 35.

Young adults have adopted ways of getting their news that are much different from those of past generations. Younger consumers are not only less reliant on the newspaper to get their news; they also consume news across a multitude of platforms and sources, all day, constantly. They also think of each other as their main news source.

Here’s a description of how “Mark”, a 28-year old manager of an online travel agency consumes media.

“Mark’s news cycle was continuous and he spent up to six hours a day searching for and receiving information. Mark was on the Internet most of the day and used that time to keep up to date on news coverage and sports-related information. Mark liked his news to be “punchy” and pointfocused. He read the headlines followed up online to “find out what’s happening” with stories that he wanted to track. Mark’s news consumption was related to other activities that he was engaged in and although he was actively consuming the news, it was almost always in tandem with other activities such as driving or working…

You may be surprised to learn,  that brands do not do all that well in social media among Millennials. Only 12% have ‘friended ‘ a brand on Facebook. Only four brands on Facebook have more than five million ‘liking’ – only 16 have more than 1.5 million.  22% of Millennial use Twitter, a small number to begin with, but of those, only 29% follow companies.  Friending a brand is a high hurdle. In terms of Facebook fans, the numbers are even lower. Just 2 brands have more than 5 million fans on Facebook, Starbucks and Coca-cola.

So what do they find relevant?

It will probably come as no surprise that the main reason to join a fan group on Twitter or Facebook is to get news or discounts. Here according to a Pace University study are the top reasons to fan a brand on Facebook:

• Getting news or product updates (67%)
• Having access to promotions (64%)
• Viewing or downloading music or videos (41%)
• Submitting opinions (36%)
• Connecting with other consumers (33%)

Meg Roberts concurs. Her blog post, “How I would Market to Myself”, goes on to offer this advice about  ’free stuff’ and interating ‘conversatoinally’ with her favorite brands.

“We’re just out of college.  Loan payments are becoming a harsh reality.  If you want us to try out your brand, give us some free samples or coupon codes.  Plus, if a company could build an entire online community based on the loyalty rewards system, I’d probably check it out to see what other users are saying about new products/sales/coupons/etc.”

“Don’t use social media as a billboard but as a telephone. Social media should be an interactive tool, and when your consumers speak, listen and respond. In my experience, the most successful Twitter accounts and Facebook fan pages are those that go beyond simple @replies and wall posts. Ask questions, get our feedback, and implement changes. Everyone likes to have their ego stroked, right? Brand consumers, especially Gen Y ones, are no different. What feels better than having a company listen to reasonable, quality recommendations we’ve made?”

(This post is the second in a series about digital marketing to Millennials based on a speech given at iMedia Summit, Miami on June 15. Tomorrow: “What Do They Want? Tapping Into Desires”)

The foundation of brand equity is familiarity, and that starts with ‘hello’.  Awareness is a critical first step in any brand relationship — unless you happen to subscribe to the power of subliminal advertising. It’s impossible to deliver any kind of message, let alone create engagement, interest or desire, without first gaining attention.

Are Millennials Attention Deficient?

With Millennials, earning attentions can also be the most challenging step in the communications model. Millennials spend their attention the way the rest of us doing money – very carefully. They are accused of having Attention Deficit Disorder. I disagree. They simply have superior Attention Deserving Detectors.

One of the characteristics that separates young adults from less digitally savvy older consumers is their remarkable filters for tuning out information they don’t want to hear.

This category of information includes alarm clocks, due dates, nagging parents, and negative feedback. It also includes advertisements. According to a study by the Participatory Network and Pace’s Lubin school, 81% say ads are not relevant and 36% say they never look at them. The reason is that they perceive advertising to be irrelevant at best, and manipulative at worst. Rebecca Denison, a 20-something social media analyst at Edelman and member of our Super Consumer Gen Y community puts it this way:

“The big thing for me and my friends is that we don’t want to know we’re being marketed to, if that makes sense. We’re smarter than that (or so we think), and we don’t like to be advertised to. It feels like manipulation, so I think a big aspect marketing to Gen Y has to be a lack of manipulation. You have to be really careful that you don’t make it too much like old school marketing because I think that really does turn Gen Y off.”

Information My Way: Customized, Personalized, Contextualized

Millennials don’t attend to banner ads, commercials or radio ads because they prefer to discover or search for information than have it foisted upon them. They are masters at finding the information they want. They also know how to ensure that the information they want is pushed to them. A year ago, I was introduced to NetVibes by a Gen Y’er who assumed I was already using it. They are masters of RSS feeds and bookmarks, Google alerts and customized home pages. As Kristin Dziadul, another Gen Y marketing community member put it, “In the attention economy today, we don’t find information, it finds us”.

This is not to say that ads never work. Of course they do. But with Millennials context and credibility may matter more than message in enabling an ad to breakthrough. A message from a friend or trusted source is far more likely to be attended than a randomly placed ad.

A new joint study by Facebook and Nielsen demonstrated the lift a campaign receives in effectiveness simply by being in a social context. An ad on a homepage enjoys a 10% lift in recall relative to a control group. Put the same ad on a Facebook page with some social context and it enjoys a 16% lift. But the same ad in an organic feed enjoys a 30% lift.

The key to getting attention is to stop waving your hand in the air and start thinking about how to get your brand discovered. Creative brilliance and heavy rotation is no longer enough. With the Millennial audience, attention is less about intrusion than it is hiding in plain sight. Millennials want to believe that they have discovered information for themselves. It’s no accident that the hottest bars, like El Secreto in Sao Paulo, are usually well-kept secrets. What’s the point of knowing about it if everyone else does too?

Fishing Where the Fish Are

‘Being found’ is not easy. It requires a shift in thinking away from message broadcasting to extreme narrowcasting. It also requires more imaginative ways to embed messages into places where they will be welcome.  Ironically though, it may be easier to be ‘found’ on a more obscure digital site or special interest community than on Yahoo.

The top sites for Millennials might surprise you in their degree of specialization. Facebook of course is the number one site for 18-24 year olds, yet it is really is not one site but a Balkanized nation of groups, subgroups and special interests. Bill Tancer of Hitwise provided drill down data on top sites for 18-24 year olds by income, geography and ethnicity. The top sites for 18-24 year olds on an index basis might surprise you. Those with family incomes $150,000 are actually most likely to be found concentrated on sites like DeviantArt, Fanfiction, UrbanChat, OVGuide, ProjectPlaylist,and MathXL.com. Those under $30,000 are most likely to be found on some of those sites but also badoo, zShare.net, mocospace and IMVU.

A New Idea – Search Enabled Discovery

Another way to ensure your ad is ‘welcome’ and ‘hiding in plain sight’ is offered by a company I learned about this week at iMedia, Vibrant Media. Vibrant Media offers a way to provide greater context for brand messages by embedding ads within relevant content. Think of it as search meets social media. Here is how it works. As an online user is reading an article, certain words or terms are highlighted by hypertext links, similar to how they appear in a blog or wiki. When the reader, who is presumably reading this article because it is relevant to them, passes their mouse over these words, an advertisement appears (and disappears as the mouse passes on). The content can be tailored to be relevant to the key word and can offer more than a standard banner; it can be an API, video or demo. For example, BING used Vibrant to demo its search engine. (To see how it works check out my bylined article on iMediaconnection today. Near the bottom of the first page, the word ‘social media’ is hyperlinked to a dynamic search app from imediaconnection that features what else, ‘social media’!).

(This post is the first in a series about digital marketing to Millennials based on a speech given at iMedia Summit, Miami on June 15. Tomorrow: “Who Cares? I is for Interest”)

Getting the right people to fan your brand on Facebook isn’t easy. In fact it may be the modern day equivalent of populating a salon with influential guests. Just two brands, Coca-Cola and Starbucks have more than 5 million fans, which is not that many considering Facebook’s user base and the the size of those brands’ customer bases.

However, difficult it is, new research from Syncapse suggests that recruiting customers to a Facebook fan page may be a goal worth pursuing. The research shows fans are much more valuable than other users and put a dollar and cents value on the difference.

They concluded,  ”A fan base is a self-segmented group of highly valuable customers“.

Syncapse used a combination of a 4000 member survey  and “in-depth proprietary research and data analyses of two-years available data across millions of interactions, Syncapse was able to compare the worth of a fan relative to non-fans for the top 20 brands on Facebook –Nokia, BlackBerry, Motorola, Secret, Gillette, Axe, Dove, Victoria’s Secret, Adidas, Nike, Coca-Cola, Oreo, Skittles, Nutella, Red Bull, Pringles, Playstation, Xbox, Starbucks, and McDonald’s. Results are broken out by brand and results vary a lot across and even within brands. Yet the overall pattern is clear. They conclude Fans were found to spend more on products, be more loyal, are more likely to recommend the brand to a friend:

Syncapse has observed that an average fan may participate with a brand ten times a year and will make one recommendation. But, an active fan may participate thirty times and make ten recommendations. The impact this has on fan value is quite dramatic. In the case of Coca-Cola, the best case for fan value reaches $316.78 but is $137.84 for an average fan. In the worse case scenario, a fan is worth $0. This degree of variability in the value of a fan must be a major consideration in determining how brands address different types of fans in efforts to move them up the value ladder. In short, the goal must be to reduce fan variability while moving the average fan value to the active end of the range.

Before you can ‘move customers up the ladder’, you have to encourage them to join in the first place.

Research shows that fanning a brand is all about content. 67% join to get news or product updates, 64% to get promotions and 41% to view or download music or videos. This is consistent with research I heard presented yesterday at iMedia Brand Summit by the Online Publisher’s Association (OPA) which indicates online users spend 40% of their time on content.

The second most important reason for friending a brand is to interact with the company or other users.  36% say they friend a brand to ‘submit opinions’ and another 33% say they want to connect with other cusotmers. Again the OPA study confirms this insight – 28% of online users’ time is spent on ‘community’ activities.

While this data is about fans and brands in general, it is especially true of Millennials. Gen Y joins brands to gain social currency (content and offers) and to interact with the company and other fans. Paul Parkin of SALT branding in San Francisco was interviewed recently by MediaPost on the subject of Gen Y and their ‘trust’ for brands. The article was widely tweeted for its insight that Millennials trust ‘channels’ over brands (“Fickle Gen Y Trusts Channels over Brands“). Farther down in the article, he commented on the need for Gen Y to interact.

Q: How important are demographics?

A: In some ways, very. Baby Boomers have one set of expectations of brands, and an idea of what it means to trust them. Gen X is quite different. In many ways, they are the brand generation. They latched onto powerful brands that emerged in the 1980s and ’90s, and if you asked most people in that group to name 10 brands that define them, they could probably do it. Gen Y is completely different — they want to multitask, and are much more into “we,” in the sense of collaboration. They want to interact with companies, and with each other.

This conclusion fits with everything we know about Millennials.  The key to attracting brand friends may be primarily promotions and content, but to retain Gen Y fans, its essential to let them speak out to the company and to each other. A brand fan page is really a platform for a conversation, a modern day ‘salon’. The brand hosts the salon, but if it is wise, will ensure that it’s really more about the guests than about the host.

According to Pew, just 31% of Millennials have no plans to go to college, with the rest either in college, planning to go to college or already graduated. This may be the most educated cohort in history. Yet, there seems to be an increasing sense of uneasiness about the degree to which college is preparing them for life after college.

They are right to be concerned. Pew data also shows that in 2010, only 41% of all 18-29 year olds have full-time jobs compared to half in 2006.

By contrast, the proportion of older adults employed full-time stayed about the same.  10% of Millenials report losing their jobs recently, compared to just 6% of older adults.

The cost of a college education (amount families pay after adjusting for financial aid) according to Money magazine has skyrocketed 439 percent since 1982“. Increasingly, students are funding the cost of their education via student loans. College debt constrains their post-college options and places a drag on their income for a decade or more.

With high paying jobs in shorter supply, students, grads and parents are questioning what is the true value of a college degree?

ROI as well as depth of majors and the college experience are considered when it comes to selecting a college.  A MarketWatch article reported the results of a survey among 2010 high school seniors. About two-thirds reported that their families’ economic concerns “greatly” or “somewhat” influenced where they were applying to college.  The decision about where to attend is also being influenced by other practical considerations such as graduation rates and percent of students employed after graduation.

Harvard has been tracking attitudes toward college among undergraduates 18-24 years old for over a decade. Over the years the study has expanded to include non-college students and 25-29 year olds. Their most recent report is based on responses from 3,000 18- to 29-year-olds from late January through late February, 2010. They found that concern about finding and keeping a job is high across college students and non-college students alike.

“The biggest thing that [college] students share with their [non-college] peers is an intense anxiety about the economy. Sixty-percent of Millennials are concerned about their ability to meet their current bills and financial obligations and 59% are worried about being able to afford a place to live. Almost half of those who are currently in the workplace are afraid that they’ll lose their job, and this fear is echoed in college students’ anxiety about their future after graduation – 84% indicated that finding a job will be ‘very difficult.’ Students are also worried about their ability to keep paying for college, with 45% of 4-year college students and 64% of community colleges expressing concern about staying in school.”

Wednesday night, Josip Petrusa and Chanelle Schneider moderated an hour-long Twitter chat using the hastage, #GenYchat (transcript here). Their topic? The “Experience Catch 22″ – how to get a job or job experience without having any. The 34 contributors vented their frustrations and shared some practical advice. Most agreed that internships help bridge the gap between college and job, but often are not valued by employers.  Blogger Jenny Blake of “LifeAfterCollege.com” (who just landed a book deal, congrats Jenny!), has this to say about an internship eased her transition:

“During the first quarter of my junior year at UCLA I got the opportunity of a lifetime. My political science professor and mentor suggested a possible internship opportunity for me at astartup company in Palo Alto. I grew up there and was ahead in school, so I told her and the founder I would move home to work full time if it meant I could help start the company. I anticipated filing papers…I was wrong. I had tremendous opportunities and responsibilities, but I hadn’t anticipated what it would be like to be in the real world – to work full time, to save money, to spend so much money, to be so far from my friends. As much as I loved the confidence I got from working so hard and learning so much every day, at times I felt incredibly lonely and confused.”

We were curious to see if other Gen Y had similar feelings, so we posted the question to our Super Consumer Community of Gen Y marketers. “Did your education prepare you for what your are doing? Should it have?”  Here’s what they had to say:

Kyle: I feel like I come from a unique background having partaken in a specialized program at my Alma Mater called the BDIC (Bachelor’s Degree in Individualized Concentration). Essentially, what it allowed me to do was really narrow down the focus of my studies at college to the topics I KNEW I was interested in pursuing in the professional world. I had the incredible opportunity to work closely with 3 professors from 3 of the colleges within my University to design a classroom and experiential curriculum around my BDIC in Sports Marketing. My BDIC experience allowed me to handpick the courses I took and pair them with internships that allowed me to really get a hands-on feel for the subject matter. Had I not had been given the reins and allowed to work in the experiential learning aspect of my curriculum, i feel like I would have left college under prepared for the challenges that one encounters on the job. While I gained a great deal of knowledge and insight from my internships, it also didn’t hurt that it helped build my resume – I feel like I finished college with a leg up on the competition for jobs in the narrow industry of sport since I had 4 internships as opposed to 1-2.

Josip:  I think education we’re getting is great and it would prepare you for that field your being educated in. The problem doesn’t so much lie in education, i think the issues lie in what happens after education. Also, sometimes education doesn’t prepare you for actual real world use. Being a philosopher, historian and many other programs that get a lot of students quite frankly don’t have real jobs associated with them. For instance my political science major does not dictate I join the government or politics. I also find that thousands of students graduate with degrees that quite useless unless you plan on being a teacher or something. Although, there are jobs for every field, the ones I mentioned at the end of the first paragraph have the most real world jobs waiting for them. My university has thousands of students graduating with political science degrees every year but I hardly see any political scientists in the real world.

Rob: This is the kind of question schools should be challenging themselves with at least once a year. I think an opportunity exists to bring more real world cases into the classroom. I know case competitions often give students the chance to sink their teeth in to real projects, but those are often some of the more challenging ones employees take on (read: looking for free consulting/ideas from students) and likely not typical enough tasks to get a solid sense of what an entry level marketing or finance person really might do at company X on a day to day basis.

Micah: Funny you should as this is a topic I have been wondering about myself very recently. I am in the midst of a Masters in Library and Information Studies and I am starting to get very worried about if I will actually have any practical skills when I graduate. Most of the coursework I have done thus far has been theoretical-based and while understanding information needs of groups and database structures seems useful, I still have no idea what it actually means to work in a library day to day. My former Master’s degree (I love college) was in American Studies, and while I learned a great deal about the culture and history of our country, I graduated with no practical work experience and went back to school after a summer working as a temp for a medical supply company. In conversations with friends recently I have started to think that if anything vocational training needs to become a more active part of our educational system. Internships are great, but since I have always had to work full time, I never had the opportunity to pursue one outside of my coursework. So basically, I have greatly enjoyed my education but I am not sure it has prepared me for active citizenry or professional life. Any steps I have made in those directions have been of my own interests and initiative.

Derek: Education itself is a wonderful thing. However, education in America today is something that is too broad. General education in college is the same things one learns in high school and middle school and even elementary school before that. This focus on general education prepares us for nothing but provides jobs for professors in the subjects. If we were to have those classes as options as opposed to being forced into them, perhaps we can begin the process of specialization. Internships further specialize but are a catch-22 in themselves. Requiring an internship as part of graduation (like Chapman University does) is an excellent idea because it helps build the résumé. The problem with requiring an internship is that not all students can afford to work for free or take time off from their paying jobs.

Tony Szymczak: Since I am in a totally different field not related to my degree my Education did not totally prepare me for what I am doing. I cannot count the number of classes that I was required to take that I had absolutely no interest in. When picking classes becomes a process of, what will count towards my degree so I can graduate on time, the education process fails. When you take a class that you really have no interest in it really destroys focus. Students face so many appeals for their attention it is hard enough to get them focused on education. The time they do spend on education should not be in classes they are forced to take because a college mandates it.

Readers of this blog may be surprised to hear me advocate for non-age specific branding! Yet the most successful brands are in fact ‘for the ages’.

Study after study of the strongest brands among Gen Y reveal very few that are specifically designed for them — I can think of only a few: Van’s, Herbal Essence. Even Facebook is for everyone now.  Favorite Millennial brands like Apple, Nike, Jet Blue, Trader Joe’s, Coach, Starbucks, and Coca-Cola, to name a few, have multi-generational appeal.

Millennials don’t particularly like brands that overtly go after their specific demographic.  (See earlier blog posts: “Gen Y discusses the iconic brands of their generation” and “Why Aren’t there more iconic Gen Y brands?“) When brands try to act cool, they end up looking like an uninvited guest — out of place and uncomfortable.

We know that reaching a Gen Y target requires a different approach than traditional media and messaging as usual. They are hard to reach, connected, have high expectations of personalization and interactivity and are highly suspicious of any claim to superiority. In contrast, they consider ‘iconic brands’ that have withstood the ‘test of time’ to be uncontrived and authentic. They are more trustworthy.

Marketing to ‘everyone’ is, as every marketing student knows, a recipe for disaster. Gen Y is a special and different target audience. But in a remarkable turnabout, they may in fact be the new mainstream.  There is a remarkable convergence happening, and marketing to Gen Y actually has more resonance with other demos than vice versa. It was not always this way. The youth target traditionally was the ‘niche’, and 25-49 was the mainstream. Now, with Gen Y trends rapidly migrating across demographic lines, what works for youth is  likely to work for older age groups, as well.

Gregg Lipman makes this point quite eloquently in his recent Ad Age article, “What Generation Gap?” (June 4, 2010).

“We see this not only in the video-game world, but also in other brands: moms and daughters with matching Ugg boots, Juicy Couture sweatsuits, Abercrombie hoodies and Coach handbags. Fathers and sons comparing fantasy football rankings on matching iPhones or killing precious productivity hours on YouTube. Teachers and students sipping from matching Starbucks latte cups or ordering the same items from Pinkberry. Moms and daughters rooting feverishly for their favorite “American Idol” contestants or shaking their heads in utter disgust at the shameless and hygienically dubious conduct of the latest batch of “The Real World” participants. Moms and their adults friends, with or without their daughters, attending Jonas Brothers concerts, or standing in line for midnight premiere showings of the brow-furrowing fest that is the “Twilight” franchise. Aunts and nieces perusing the same Kiehl’s or MAC products. Uncles and nephews cracking open cans of Red Bull. Grandparents, parents and their children conversing freely on Facebook or Skype.”

Jonas Brothers? Really? Yet I agree with Lipman’s central argument that brands should aim to transcend age categories, by going after Gen E (Everyone). I also agree with his conclusion about how it should be done –  by focusing on the ever narrowing cultural gap between Millennials and their Gen X and Boomer counterparts.

“These companies [iconic brands] have successfully created branding stories that resonate across a spectrum of ages because they have largely ignored age-based demographic “insights” as they were, and instead focused on harnessing societal (the blurring of the generation/cultural gap) and technological (the desire to be ever more connected) trends to their benefit….Appealing to Generation E requires a massive shift away from the standard “What are they looking for in a product?” to “What does this brand say about me as a person?”"

The key sentence here is the importance of is basing a brand’s appeal on something greater than the product attributes that have traditionaly formed the foundation of brand strategy. Successful brands are becoming more culturally-driven than attribute driven.

Marketing to Gen Y today — and Gen E tomorrow– is more about organizing content and conversations around common interests and passion points than about message points.

This trend has important implications for research and brand strategy.  While traditional research still has a place, there is a greater need for understanding customer interests beyond the category or even ‘lifestyle’.  Social media offers a new way to strategically differentiate a brand and build customer relationships by shifting the focus of the conversation on shared purpose and common cause.  And isn’t that the definition of community, anyway?

Lipman concludes his article by saying “We don’t think that the generation gap will ever totally disappear, and that’s probably a good thing, but in this age of hard-core partisanship, perhaps we as marketers can soften the rhetoric between the generations and create stronger brands at the same time.”

Or said another way, perhaps ‘purpose‘ provides a clue as to how to make a brand ‘ageless‘?

1971 Chrysler Simca = Freedom

I got my driver’s license on my 16th birthday. I promptly purchased a 1971 Chrysler Simca (yes orange although not as dirty as the one in the picture).

That tiny, tinny car was the biggest milestone in my life up to that point. It symbolized adult freedom and adult responsibility.  It wasn’t long before I had a real job and more money than I could make babysitting.

Most of my friends made a similar jump about the same time. In fact, 4 million cars were sold in 1971 and 1972, a record at the time that reflected the demographic bulge of the baby boom.

Today the coming age rite is more likely to be a cell phone than a car. In 1978, over half of all 16 year olds had a driver’s license. By 2008 that figure had dropped to 31%.

Over half of all 12 year-olds had a cell phone in 2009. In fact, one study of 17,000 school children revealed more pupils age 7-16 own a cell phone (85.5%)  than own a book (72.6%)!

It would seem a mobile phone now symbolizes a major adolescent milestone much as a car did for me. The Internet liberates them from being bored, and gives them new vistas. For me, mobility liberated me from hanging out with my family.  I had things to do! Places to go! A car connected me with a wider world, and became the center of my social life.

Tim Stock of scenarioDNA observed in his excellent lecture on how different generations were shaped ( “Culture Networks“), that for Boomers, ‘The Road’ was our network, our ‘information superhighway’.  The open road symbolized rebellion, and spawned countless archetypes.  A long, independent car trip was a rite of passage. I shudder now to think that I drove ALONE from Florida to Michigan at age 18.  Times have definitely changed, and Millennials do not have the same relationship with cars that we did. Mobility has a different meaning. They don’t need to ‘get out and go somewhere’.  They can shop online, download a movie, and connect with their friends without ever leaving their room.

As Stock observes, Gen Y is less concerned about where you go and more concerned with ‘how you transform what is there‘. ZipCar and its competitors seem to be perfectly in tune with this refocus on doing things. My Saturday afternoons were spent cleaning and waxing my car, then driving to the beach to see who else was there.  For Gen Y, it’s not about owning and caring for an incredible car, it’s about getting somewhere so you can experience something incredible.

Many Gen Y’ers actively reject the car-centric culture I grew up with.

Cars are seen as wasteful, status-oriented and ecologically unsound. Riding the bus does not have the same stigma it once did. Hummers have become a symbol of what’s wrong with consumer cultureThe money saved by not owning and operating a car frees up money for other things —  like education, technology and travel. These expderiences are higher priorities for Millennials and are perceived as offering greater return for the money.

Millennials don’t hunger for the latest model or edition.  In fact as a nation, we all appear to be satisfied with driving cars longer and longer.  The media age of vehicles in operation was 9.2 years in 2007. This figure is up from 6.5 years in 1990 and from 5.1 years in 1969. Perhaps we’re moving toward a model where we only buy a new one when the old one costs more to fix than it’s worth, as we do with refrigerators and most other ‘appliances’. The thrill of that new car smell is gone.

Paper & Plastic, Compost or EBay/Craiglist

This is a big adjustment for the automobile companies. But it is also an issue for any marketer of  ’durables,’  ’real estate’ or other big ticket items. According to Mike Doherty, President Cole Weber United, Millennials can be thought of as ‘generation prototype’.  ”For Gen Y, hard goods have soft lifespans.  Durability is relevant but mostly in relation to different products.” Gen Y thinks less about the ‘thing’ and more about the utility of the thing relative to other purchases. He writes in MediaPost last month….

“If you are in the “consumer durables” market, you already know that it’s a label that doesn’t make much sense to Gen Y. For Gen Yers, the consumer durables equation seems to look like this:

Product Lifespan = Adopted + Adapted + Left Behind for the Next Version

To a Gen Yer, durability is often acknowledged as being relevant, but its importance is relative to different products. It’s not too much of an exaggeration to say that there are really three recycling bins in Gen Y homes: Paper ‘n’ Plastic, Compost, and eBay/Craigslist. If Gen Yers are fortunate enough to get their hands on a v1.0 iPad, they will love being one of the first to have one, but they also know that there are more versions to come in a few months, making their hot item quickly feel outdated.”

This may look like ‘fickleness’ but I think it’s more of an indication of their tendency to not become romantically attached to ‘things’.  Gen Y is first and foremost looking for utility and performance. They will switch for a better alternative, without much hesitation.

This practicality and lack of romanticism poses a challenge to durable goods marketers – the lifestyle approaches of the past most likely won’t work. Young adults are more likely to ask the hard questions: “How does it perform relative to alternatives?” and “Why should I buy it at all?”