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.
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?”
Nearly 20 years ago, William Strauss and Neil Howe wrote a book that theorized a 22 year generational cycle based on repeating generational archetypes called simply “Generations“. They called these cycles ‘turnings’. Children raised during a particular Turning share similar historical and cultural experiences, which results in their being like each other, and different from other generations. This was to my knowledge the first appearance of the word ‘Millennials’.
A chapter that begins on page 335 of 427 (paperback version not including Appendices and Sources), is titled “Millennial Generation”.
What makes this chapter on Millennials so fascinating twenty years after it was written is how uncannily it matches what we know to be true of how Gen Y is different from preceding generations.
Part of the reason for its accuracy is that the demographics of this generation were fairly predictable, even in 1991, and demographics are one of the forces that shapes generations. Strauss and Howe were able to accurately project the likely size (76 million) and make up (12% immigrant) based on fertility and immigration trends, even though only 33 million of them were alive when the book was published.
The authors were also tuned-in to the major shift in parenting and education as a cultural priority that was already underway by the early 90′s. This shift would prove to have a remarkable impact on Millennial self-perceptions, aspirations and values. Nearly twenty years ago they noted that “this new generation of children is being treated as precious” and “Boom parents and teachers have also been slowing down the childhood development clock — unlike the Silent, who sped it up.”
“First-wave Millennials are riding a powerful crest of protective concern, dating back to he early 1980s, over the American childhood environment. In 1981, the year before the “Class of 2000″ was born, a volley of books assaulted adult mistreatment of children through the 13er (Gen X) birth years. Within the next couple of years, other authors began reconsidering the human consequences of divorce, latchkey households, and value neutral education.
In 1984, two kids as devils movies flopped at the box office, marketing the end of a dying genre and the start of a more positive film depiction of children.
From 1986 to 1988, polls reported a tripling in the popularity of ‘staying home with family’….In general, Boomer parents are determined to set an unerringly wholesome environment for their Millennial tots.
Where Silent parents had brought 13erkids along to see $-rated movies made about them, Boomers take the Millennials to see G-rated movies made for them.”"
“From 1976 through 1988 the proportion of students held back in elementary school jumped by one-third.”
One of the central tenets of the book is that the fourth generation in each cycle, the “Fourth Turning”, tends to be more civically minded and engaged. They look for signs that yesterday’s fourth graders might be more evolved as citizens and found it in Anna Quindlen’s observations that kids seemed to be “assimiliating society’s ‘shalt nots’ about crime, drugs, polution and education with disquieting energy and unanimity.” (page 341) Twenty years later, we know from the research that today’s young adults are much more ‘upright’ than earlier generations in terms of their overall optimism, attitudes toward the environment and social action and behavior regarding drug and alcohol use, teen pregnancy, and crime.
What Howe and Strauss could not have known in 1991 was the remarkable impact that technology and the most severe economic recession in over 60 years would play in shaping this generation.
Beyond demographics, two of the forces that are shaping up to be the most influential are easy access to information of all kinds and a realization that America’s high flying lifestyle is most likely unsustainable. They have already resulted in a more empowered, yet sobered, generation that is exhibiting very different consumer and media behavior as they move into their prime earning years.
BrandAmplitude‘s latest ebook (“How Millennials Are Different“) is focused on spotlighting the ways that Millennials are different from generations that came before at the same age. The book, which zeroes in specifically on longitudinal data from Pew Research and other sources, shows Gen Y is different in many significant ways, only some of which were predictable in 1991.
Nevertheless, what Strauss and Howe foresaw about how Millennials would be different from preceding generations based simply on cultural and demographic trends, they got remarkably right.
I’m glad to finally see social media starting to show up in television shows in a big way. While smart phones have long been a staple feature of sitcoms and dramas, few plots until now anyway, appear to have actually turned on social media or mobile technology.
But last week, I spotted not one but two major shows with social media-related plot developments.
Glee: On Tuesday’s episode of Glee, the most nerdy of the Gleek students enjoyed a hilarious pilfered video of their nemesis, Sue Sylvester, the intense and intensely funny cheerleading coach dancing in her office to Olivia Newton John’s “Let’s Get Physical”. They quickly upload it to YouTube where it quickly reaches 3 million hits. Sue has the last laugh however, when Olivia Newton John contacts her about remaking the 80′s video together.
The Office: Then on Thursday in The Office, Pam Halpert searched out information incriminating Michael Scott’s new girlfriend of being unfaithful by leveraging access to her Facebook page through a friend. He later learns she is actually married, a development that would not have occurred but for Pam’s Facebook stalking.
The use of social media in these shows feels completely natural and plausible. One takes place in an office and another in a high school where social media is a routine part of daily life. One wonders why we don’t see more?
This leads to me to speculate how technology and social media may have played a role in 90’s television shows and movies had it been as integrated into daily life then as it is now. Imagine the way things would have gone if…
Bonfire of the Vanities: Gordon Gecko accidentally ends up in the Bronx when he fails to make a fast enough turn in response to commands from his Garmin. “Re—- calculating!”
Cosby: Cliff Huxtable uses simulated reality game to instruct Cleo on the true cost of life on his own.
Sex in the City: All the single ladies use the new Facebook social graph to prequalify dates, making it faster and easier to identify the ‘likes’ of potential dates, weed out creepers, identify keepers and generally ‘put a ring on it’.
Home Alone: Kevin McAllister uploads photo shopped pictures of himself in France to make his family believe he is actually already there. Meanwhile he projects Youtube videos of his family onto the walls to create the illusion of people being home for the benefit of the burglars.
Fresh Prince of Bel Air: Will Smith challenges Carlton to see who can get to 10,000 Twitter followers first.
Okay, you get the idea. Now consider how different the shows of the 70′s and 80′s might have been! What if there had been social media when they made Back to the Future, Golden Girls, Gilligan’s Island, Family Ties…
We take you now to State Street and Madison in downtown Chicago on a sunny Friday afternoon in April…
John: (Holding clipboard) Hi, do you have a minute?
Carol: (Pausing) What’s up?
John: (Perking up, surprised) Hi, thanks for stopping! My name is John, what’s yours?
Carol: Hi John, I’m Carol Phillips.
John: Nice to meet you Carol. We’re here to sign up members for Greenpeace, do you know Greenpeace?
Carol: Of course.
John: (Energetically) Greenpeace is the …
Carol: (Interrupting): John, are you a volunteer or paid?
John: (Sheepishly) Paid, but Greenpeace is a great organization, we ….
Carol: Can I ask you a question?
John: Sure….
Carol: What do you do when you’re not here?
John: (Confused) I work…(vaguely) and I have other jobs…
Carol: Are you a student?
John: I graduated last year from (well-known University) in Finance. But there aren’t many jobs so I saw this one in Craig’s List and I’m glad to have it. But it’s tough.
Carol: It keeps you out of your parent’s basement…
John: (Quickly) Oh, I have an apartment.
Carol: Do you have student loans you have to pay as well?
John: (Suddenly looking very worried). Oh yes, a lot. They are on hold until July, but after that I don’t know what I’m gonna do…I had a job out of school as a stock broker, but I quit after a few weeks. I just didn’t feel good about it.
Carol: Very Millennial of you…
John: I felt like one of those guys that got us in all the trouble. I didn’t want to be one of those guys.
Carol: How much does it cost to join Greenpeace today?
John: Most people go for a $1.00 a day or $30 a month.
Carol: $365 a year.
John: No, $30.
Carol: But over a year that’s $365, right, you were in finance…
John: (Smiling again) Right!
Carol: What’s the minimum to join?
John: $15. It’s more about the advocacy than the money.
Carol: Okay, I’ll sign up on the Internet when I get home.
John: (Looking worried now) Well, I have to sign up at least two new members a day to keep my job.
Carol: How many have you signed up today?
John: (Looking very worried) Well, actually none today.
Carol: I have to go make a phone call, I’ll come back if you’re still here, I’ll sign up then.
John: (Disappointed) Oh, we’ll be here, we’re here all day.
Fifteen minutes later…
Carol: Hi, I’m back.
John: (Befuddled) Oh hi, it’s not you, I just had a bad …. it’s so much harder here. I like being on college campuses more. Here no one wants to talk to you. They are so used to being panhandled.
Carol: Yeah, I agree, this is not the best location, why not go to Millennium Park (points down Madison Street).
John: We go where they put us. We’ve got locations all over the city. The people on campuses are so much easier. I like the campuses.
Carol: Have you gotten any more members?
John: No.
Carol: Well sign me up for $30.
John: Oh, great, thanks. Just fill this out.
Carol: Do I have to pay right now?
John: Well, yes. But in all our years, we’ve never had a problem with a credit card. I’ll give you my credit card…
Carol: No, that’s okay. Do you have a card?
John: (Reaching for his credit card)
Carol: No, I mean a business card, so we can stay in touch.
John: No.
Carol: Do you have a Twitter account?
John: No, I’m more of a Facebook user.
Carol: Okay, give me your email, I do market research and maybe I can use you in a study. I’ll be in touch.
John: Great. Thanks.
Carol: Bye
John: Bye!
One of the questions I hear a lot is ‘What exactly is a Millennial‘?
I have addressed this a few times, before in this blog (see “What’s a Millennial? Why Do Marketers Need a Label?”). Just like the question ‘what is a brand‘ there is no easy agreed upon answer, although I generally answer that I subscribe to the definition used by Pew Research that a Millennial is someone currently age 18-29, born after 1980.
Just for fun, I decided to answer the question as definitively as I know how. Using Census data and Pew Research definitions, I created a chart that shows the number of people there are of each age, from 0-100 years, based on 2008 projections for 2010. (I also laid the actual birth years below so you can double check your identity.) No doubt this data will be updated when the new Census data becomes available, but for now, this may be as good as it gets.
Here are a few observations:
First it confirms that the big three are Millennials (including teens), Gen X’ers and Boomers. Millennials are 73 million strong. Boomers are still the largest cohort by a 3 million person margin and Gen X the smallest. The bars become shorter and shorter past age 63 (yikes that’s a steep decline!) so we can reasonably project Boomers will shrink each year while Millennials and Gen X will be large for some years to come.
Another observation is that the Millennial population currently peaks at age 19-20. This explains the ultra competitiveness of college admissions the last few years with record applications, selectivity and enrollment. This peak is good news for the age groups that follow, those currently 18 or under, but bad news for those ahead them who are already struggling to find good jobs without the added stress of a peak number of new college grads hitting the market.
A final observation is that while teens are currently separated out, they should probably be considered part of the Millennial generation once they turn 18. Most generations span a period of more than 12 years, and this one will most likely be no exception.
My biggest take away from this chart is a caution. A group of 73 million people (current teens and Millennials) should not be thought of as a single ‘market’ any more than Boomers can be thought of as a ‘market’.
The concept of the ‘Millennial market’ for marketers should probably represent more of a psychographic or starting point for segmentation. Millennial, like Boomer, will most likely come to represent a set of values and way of looking at the world. I have long maintained that when marketing to Gen Y, values and behaviors are most defining and useful than age.
Pew seems to agree with me. For the last month or so, Pew has offered a How Millennial Are You? online quiz. If you haven’t taken it, I urge you to try it. The questions are scored 1-100 with anyone scoring 73 or higher rated a “millennial”. The scoring mechanism seems to be pretty accurate based on the results of the quiz. Most Millennials in fact do score pretty high. I scored an 81, well into Millennial territory, a fact I am proud of.
The actual answers from the 2010 Pew Millennials survey on which the quiz is based can be seen here. Even among true age-defined Millennials, the answers are a matter of degree, not black and white.
Sorry for all the numbers, but I think they provide a useful caution for marketers: It’s less about your age, than about young you feel and act.
The image of the poor artist living in a garrett was probably never as romantic in reality as it sounded. Unfortunately, many of today’s young adults, especially those without resources (like parents) to fall back on, are making that discovery. Mariam Shahab, a Boston University Senior and blogger, bemoaned in Twitter just today “Are we going to be forever known as ‘Generation Recession’“?
The definition of a ‘market’ is a ‘group of people or organizations with a need and the means to satisfy it’. Unfortunately, the “Millennial Market” may not be living up to its true potential, at least right now, due to lack of means.
I am confident Millennials would be lining up to purchase iPads immediately if it weren’t for the high price tag. Fifty-seven percent of 18-34 year olds say price is the number one reason they aren’t buying an iPad, double the average for all ages.
Tru-Research reports that 50% of teens in 2010 say “Not enough money” is their ‘biggest complaint’. This figure compares to just 30% ten years ago. Twenty-three year old Christine Carter wrote an article in Retail Customer Experience this week to explain “Why Gen Y isn’t Buying Your Products“. She writes:
“Our education expenses, our social desire for luxury goods and our inability to save money make us very cash-poor. Because our generation responds and adapts rather quickly to social changes, we have emerged from the recession as “Recessionistas,” informed shoppers who stick to tight budgets while still managing to stay trendy and cultured. We’re looking for inexpensive versions of the items we desire and durable versions of the items we need.”
I hear the same lament almost daily from my marketing students — they consider themselves cash-strapped. Last week, every student expressed a preference to watch ads to access TV shows online rather than pay to avoid them. When I see articles about Gen Y and shopping, they generally refer to teens. Young adults do not seem to get the same pleasure from shopping as those who are still spending their parents’ money. They see it as stressful and are extremely careful shoppers, researching larger purchases and avoiding impulse buys. Of all age groups, Nielsen points out, they make the fewest shopping trips.
Just how poor are Millennials? Let’s look at the data.
First, the Recession was just the latest in a long downward trend in young adult wealth. I have reported before on Gen Y being one of the poorest generations of young adults. According to a 2008 report by DEMO’s, “The Economic State of Young America“, young adults of 2005 were worse off on nearly every dimension of economic well-being other than education than young adults in 1975. Here’s how The Nation summarized the DEMO’s findings:
Men without a high school diploma suffered most, their annual income plummeting by 34.2 percent, while men with a high school diploma or the equivalent earned the runner-up slot, with an income drop of 28.5 percent. As for women, those with less than a high school diploma, as well as those possessing just a diploma, lost less ground than their male counterparts; but then again, they’re still doing worse than before and, perhaps more to the point, they still fare significantly worse than men their age.
At the same time, today’s young workers have had to do more with less. College tuition rates have skyrocketed–in fact, rates for four-year public universities have more than doubled since 1980–with the unsurprising result that nearly two-thirds of students graduating from four-year colleges in 2008 left in debt. The cost of childcare now eats up as much as 10 percent of a two-parent family’s income in many states (as much as 14.3 percent in Oregon). And young people between the ages of 19 and 34 are the most likely population to be uninsured–not because they don’t want health benefits but because employers don’t offer them. A case in point: 63.3 percent of recent high school graduates had employer-provided healthcare in 1979, whereas just 33.7 percent had it in 2004.
“What we’re looking at is a situation where young people entered the recession already feeling the brunt of thirty years’ worth of pretty gradual but nonetheless dramatic economic and social changes,” says Nancy Cauthen, director of the Economic Opportunity Program at Demos. “The recession just made a bad situation worse.”
Today’s BLS positive employment news was welcome, but doesn’t change the fact that unemployment among young adults is at an all time high, much worse than for older age cohorts. Sixteen to nineteen year old unemployment in March was 26%, twice what it was in March 2000.
An article in The Fiscal Times (“The American Dream Dilemma“, March 23) draws a vivid portrait of today’s Gen Y as ‘broke, unemployed, moving home, and living on food stamps.” The part about living on food stamps appears to be no exaggeration. Salon magazine this week also offers an extensive profile of Millennials signing up for EBT cards from the government’s Supplemental Nutrition Assistance Program (SNAP) , then attempting to satisfy their foodie and organic cravings once they have them (“Hipsters on Food Stamps“, March 15) — “Is it wrong to believe there should be a local, free-range chicken in every Le Creuset pot?”
Marketing to a target audience that faces true economic uncertainty is a challenge, especially a market that is used to thinking of what used to be considered ‘luxuries’ (cell phone and computer, high quality food, Internet access) as necessities. They are trying to stay away from credit, using debit cards for purchases and cutting corners whenever possible. Marketers who are winning are careful to explain the real benefits of their products, not just the sizzle.
Despite their current dire straits, Millennials strongly believe better days are ahead. Marketers that reach out to them in meaningful ways now could reap significant benefits later.
Target is a retailer that seems to understand the Millennial “thrifty yet hip” mindset best. According to Nielsen, Millennials are more inclined to shop there more often relative to other age groups as well as to outspdend them. (Nielsen, “Mining the Generations Gap“)
“Certain store banners hold a unique appeal for the younger generations, and Target is at the head of that retailing class. Target stores have managed to maintain a hip, trendy image with a strong value message with whimsical advertising; strong, almost pop art in-store merchandising; and a roster of high profile designers for everything from housewares (Michael Graves) to bedding (Todd Oldham) to women’s fashion (Mossimo) to cosmetics (Sonia Kashuk). And, with the interest in at-home meals, Target recently announced a new partnership with TV cook show host Giada De Laurentiis for a store-brand line of specialty food items and cookware.
I can hardly believe it, but this is my 300th post. Wow! Allow me to reflect a moment on how much has changed in the area of Millennial Marketing.
One of the biggest changes is the sheer amount of information available to marketers about Gen Y. Two years ago, there was little to draw on, so we did our primary research studies – on the workplace and on social media. No longer. There are mountains of free published information, and a lot of is is very good. Any marketer who needs to understand Gen Y (and who doesn’t?) should start with what is already published. True much of it will not be exactly what you need. A syndicated study doesn’t ask that specific question about your category or brand. But for context, many of these studies are better than what any one firm could do on its own.
Earlier this year we started keeping track of the best studies we ran across in a wiki, called Millennialmarketing.wikispaces.com. (Bookmark it!) Each study has been classified into one of a dozen categories. There are usually dozens of studies within each category, and new ones are being added nearly every day. (If you register, you can add your own finds as well.)
Millennial Consumer & Shopping Behavior
Millennial Lifestyle, Attitudes & Values
Millennials & Financial Services
Millennial Demographics & Economics
Presentations & Ebooks on Millennials
Generational marketing skeptics (yes, there are many) usually have two main objections.
The first objection is that Gen Y is really just like other generations at the same age. Any differences are due to stage of life – students and young adults naturally are different in their outlook, values and spending patterns. As they mature, marry, take on real jobs, have kids, etc. they will naturally lose some of their ‘distinctive’ qualities.
The second objection is based on the concern that sweeping generalizations about any age group can obscure important individual differences and be misleading.
Of course, there is a grain of truth to both claims. Lifestage is part of the puzzle and an important marketing variable — young people are different from older consumers. That’s why age is one of the first bases of most segmentation schemes, along with gender and ethnicity. BUT! It is a mistake to assume young people of your generation are the same as young people today. They grew up in a different time and were shaped by different cultural forces, not to mention different technology and prevailing parenting views. Do you think your parents were the same as you at the same age?
If this logic isn’t compelling enough, longitudinal research studies provide evidence of generational shifts. Here are several studies worth checking out. They compare young adults of today with people the same age at different points in time.
As for stereotypes I have addressed this before. Stereotypes and ‘profiling’ are problematic in most areas of life, but they are essential for marketers. Until we have tools that can target people individually (and that day is coming faster than you might think), marketers must aggregate people based on characteristics into segments and create profiles (or if you prefer, ‘persona’s') to keep their products, messages relevant.
Which brings me back to the value and limitations of secondary research. It provides an excellent starting point, but should be considered just that, a beginning. Marketers need specific information about how Gen Y thinks about their category, brand or marketing program. For that, there is no substitute for primary research.
Longitudinal Study of Young Adult Mental Health
Pew Research Reports: How Are Millennials Different than their Parents at the Same Age?
Girl Scouts USA Longitudinal Study of Values
College Board Student Poll of Incoming Freshman
DEMOS: Economic State of Young America
Happy 300th to me! Hope you enjoy the gifts.
I haven’t seen an iPad in person but I have watched a few video demos, like this one from Wired magazine at SXSW. I definitely want one, although not enough to be among the half a million people or so who have pre-ordered to the point that it is sold out. (Another nice scarcity marketing coup for Apple!)
Thanks to strong pre-order rates, Apple’s manufacturing partners now expect to ship 2.5 million iPads between March and May. Device sales are only the beginning for Apple of course. As with iTunes, the real money is in the ‘after sales’ – in this case revenue from content providers and advertising. Apple just announced its mobile ‘iAd’ platform for the iPad, which will bring Google and Apple face to face in mobile advertising. Things are starting to get intersting….
I am doubtful Millennials will be among the early adopters.
My students at Notre Dame show no interest. They have all the devices they need to listen to music or access the Internet. The $499 to $829 price is also a significant barrier. On the other hand, they may not be all that representative. Focus group research by Frank Magid suggests the appeal knows no demographic bounds. Consumers of all ages expressed enthusiasm. Even stronger evidence of Millennial appeal comes from a study by NPD, which suggests the iPad enjoys its strongest appeal among young adults and Apple owners.
NPD’s Apple iPad: Consumers’ Perceptions and Attitudes report found that awareness is highest among current Apple owners, (82 percent), consumers with $100,000 or greater income (80 percent), and 18-34 year olds (78 percent). Those demographic groups are the ones with the most interest in buying an iPad. Only 18 percent of all consumers surveyed expressed a real interest in owning an iPad while 27 percent of 18-34 year olds and 24 percent of Apple owners said they were extremely or very interested.
A lot depends on how much new functionality the iPad brings. If it just allows you do to more of what you already do, why invest in a new device and ongoing data plan?
Smart phone penetration is growing smartly. Penetration of smart phones like the Blackberry and iPhone was just 21% in Q4 ’09 according to Nielsen, but is expected to reach 33% by the end of Q4 ’10 and be half of all cell phones by Q4 ’11. With that kind of mobility in your pocket, many will certainly find another device superfluous.
There are suggestions, however, that the iPad will be ‘transformational’. I am especially intrigued by the announcement from MTV this week of a co-viewing app developed specifically for the iPad and mobile phones. They observed that 59% of people multi-task when watching TV, and are betting that tablet devices and mobile phones will be easier to play with while watching TV than laptop or desktop computers. This would mean true ‘interactive’ TV – you interact with friends while watching. IPad apps for “Beavis and Butthead”, “MTV News” and “VH1toGo” are due in April. I’m sure this is just the first of many ‘firsts’ we will see from the iPad (social shopping anyone?!)
Integration of interactive ads, social networks and cool, fast visuals could make the iPad a ‘must have’ for Gen Y, especially after the price comes down.
According to the NPD research, price is currently the main barrier. Among the 18-34 year old demographic, 57 percent of those survyed by NPD cited price as the number one reason they aren’t ready to buy, 25 percent more than the overall percentage of non-interested buyers. That discrepancy suggests there may be pent up demand that can be tapped by lowering the price. Given the pattern of start high, end low followed by the iPhone and iTouch, Millennials may in fact be the main sales driver for the iPad.
The Value of Rubbing Up
This week Brad Berens generously visited University of Notre Dame to deliver the keynote speech at the MBA-student sponsored event, the Social Media Symposium. I’ve ‘known’ Brad via email and Twitter for nearly 4 years, but this was our first corporeal experience. (Thanks, Brad. for enlightening me on how the word corporeal is actually pronounced!)
Brad Berens has what many Millennials aspire to – that is a ‘slash career’. He simultaneously wears many hats including blogger/ imediaconnection editor-at-large/Senior Research Fellow at USC Annenberg School for the Digital Future/event producer for DMG World Media. In his position as Chief Content officer, Digital Marketing Officer, his main focus is producing 18 marketing events each year, including AdTech, the CMO Executive Summit and iMedia Summits. In other words, he is well plugged in to what is happening in digital marketing and media.
Berens’ keynote, titled “Media Friction and Fragmentation”, was crowded with insights and ideas, but two ideas in particular stand out: “All Media is Social Media” and “Consumers Want to Increase Their ‘Social Friction’”. Together they provide a useful prism for evaluating the torrent of new digital marketing ideas.
All Media Is Social Media
Think about it: everything we do on the Internet is inherently social, or at least has the potential to be social. To the extent that media is rapidly becoming digitized, it follows that all media is inherently social. Most Internet sites and video games have a ‘share this’ option. Sharing can be asynchronous (i.e., an email forward or tweet) or simultaneous (Chatroulette, Call of Duty). Sharing is caring. The construct of the lonely person at their typewriter or the isolated computer geek has completely given way to the virtual social world of the connected consumer.
Consumers Want To Increase Their ‘Social Friction’
In business friction is a bad thing. We want efficiency, not friction. But in our social lives, friction means we’re getting closer to others and that is a good thing. Visiting Disneyland is a high friction experience – you don’t go alone (or how sad for you if you do). Watching a movie or bowling can be either a low friction experience or a high friction experience depending on whether you have an opportunity to interact with others during the experience. Likewise with the Internet. It can be high friction or low friction. To the extent that we can make the Internet more like Disneyland and less like watching TV or bowling alone, it will be more compelling to users.
By combining these two insights, the logical conclusion is that the most useful and compelling social media platforms will be those that are high in ‘social friction’.
Social media is not just a way to communicate — communication is only the beginning. Social media is a form of entertainment that offers consumers new ways to literally be together online and even to enhance their analog experiences. Looking at some of the hottest trends in online media through this prism provides insights as to why these are gaining traction: they each embody the idea of high tech meeting high friction.
1. Location-based Platforms
Foursquare and Gowalla are two of the hottest platforms in what is known as location-based marketing. Each of them allow you to notify your friends who use the platform where you are by ‘checking in’ to different locations. There is a game-like quality to the applications by providing rewards for frequent check ins, but over time it is thought that the real power and appeal will be allowing you to know whether you know anyone in your immediate vicinity. You can also change your plans to be more likely to be where your friends are. No more accidental encounters. Twitter and Facebook have also recently incorporated location elements to their platforms. The new iPad will also provide location-specific advertising and marketing opportunities for social connection. (For more on how marketers are leveraging location-based platforms, see Mashable’s “Five Things You Need to Know About Location-based Marketing”)
2. Social Gaming Platforms
In the old days we had solitaire and Bejeweled. Then there were games you played online or within Facebook like Farmville or Scrabulous. Now console and online games like World of Warcraft and Call of Duty are almost entirely seen as a way to interact with friends. According to a recent TIME magazine article, the next generation of games will take the idea of social friction to the next level. The next generation of online games — like the popular Bejeweled Blitz — will offer richer, more direct competition and game play between users. New platforms from iPhone and Facebook will allow players to share scores, statistics and and even add a personalized gaming highlight reel to their profile directly from Xbox 360 or Playstation.
3. Social Shopping Platforms
For Millennials, especially, shopping is ‘social glue’, whether it is done online or in-store. Millennials are more likely to shop with someone else, and they are ready to spread the word if they see a particularly good deal. According to Mintel, sixty percent of 18-34 year olds “read consumer feedback online about products or services before making a purchase”. Sixty-five percent of teens say when their favorite brand or store has a sale, they want to share the information with their best friend or sister. Sites like Storrz, ShopTogether and soon to be launched PlumWillow leverage the social side of shopping to allow teens to connect with their friends. There is a huge opportunity to combine the fun of a game with shopping. Deal sharing sites such as Groupon.com and LivingSocial.com reward you for signing up new users if they subsequently buy a deal. Groupon only makes a deal official if a certain number of people purchase it.
4. Social Viewing Platforms (The Back Channel)
The Academy Awards and Super Bowl viewing experiences were transformed this year by consumers connecting via Twitter on the ‘back channel’ as they watched the ‘front channel’ on TV.
The next generation of Web-connected TVs and software will include ways for people to monitor and interact with the conversation happening around an event, filtering live streams in real-time to display the most relevant discussions. According to TIME , an interview with Twitter founder Evan Williams at South By Southwest was wrecked by criticism on Twitter (more than a little irony there!). “Festival goers were unimpressed with the questions posed to Williams by moderator Umair Haque of the Harvard Business Review and tweeted their displeasure before leaving the interview en masse. In a blog post later, Haque said he wished he had been monitoring the Twitter conversation from on stage.” The ability to have a discussion during a shared viewing event enhances the viewing, for better and for worse…
5. Social Action Platforms
There are many sites offering advice to non-profits on how to leverage social media to connect with their users, but I found very little about how to connect users to each other. The site, Act.ly, is a Twitter-based platform that allows users to start petitions and recruit like-minded individuals to support them. Twestivals are another way Twitter is being leveraged to bring people together in the offline world. The site allows you to attend events in your city by donating to worthy causes selected by the organizer. A key feature is begin able to see who is planning on attending. Look for more sites that connect people around causes to energize them to get off their computers and into their communities – together.
‘Social friction’ is a useful concept for marketers who want to engage Millennials.
Marketers wishing to engage Millennials would be wise to leverage these social media platforms to help Gen Y’ers do more of what they want to do – spend more time with their friends and to make that time as rewarding and fun as possible. Why? Young adults and teens are adamant that their digital world is no substitute for real interpersonal relationships and interaction. Millennial, Angela Stefano, describes her wish for less digital, more analog life succinctly in The Next Great Generation blog:
“I, for one, would much rather be at a party with my friends than at home reading tweets and text messages about what a great time they’re having. … If anything, our analog lives are made more complex by our digital ones. …Not to mention, your digital world wouldn’t be very exciting if your analog one wasn’t filled with people and activities. Without those first connections…well, you’re kind of just a creeper looking for friends in a chatroom. When it comes down to it, our digital lives complement our analog ones. And it should never be the other way around.” – Angela Stefano
