Millennial Brand Connection

Research FindingsChristian Ruzich

Joe Mandrino

© 22014

Quick facts about the Millennial generation

Born between 1979 and

1997; ages 17-35 in 2014

Consists of more than

75,000,000 American

consumers and is the

largest generation since the

Baby Boomers

Racial minorities comprise

41% of Millennials

42% are married or part of

an unmarried couple living

together; 55% have never

been married

36% are parents

62% are head of the

household

$889.3 billion annual

Millennial buying power

29% are full-time students

43% of recent graduates

now working are in jobs that

don’t require a college

education

© 32014

AUTHORSHIP AUTONOMY AUTHENTICITY

Core values of the Millennial generation

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© 42014

Core value #1: Authorship

“I wish I had more opportunities to customize

products to really fit my lifestyle”

2014 US Yankelovich MONITOR

They want to define their

own dreams, invent their

own solutions and assert

their will in the

marketplace

Millennials are shaped by a

keen sense of being

special and an

unprecedented level of

technology-proficiency

They ultimately want to

have a say in the structure

and specifications of the

things they buy

59%Total US

71%Age 18-34

vs.

© 52014

Core value #2: Autonomy

Answered “extremely” or

“very” when asked to describe “importance of

spending time researching a product before

buying is”

2013 US Yankelovich MONITOR

They are comfortable going

their own way, but they

also enjoy standing out

within the crowd

Millennials relish

independence and expect

to be able to exercise it

As a result, Millennials stay

savvy when it comes to

what they buy

66%Age 18-34

© 62014

Core value #3: Authenticity

“It’s a person’s responsibility

to stand up for his/her beliefs,

even if they are unpopular”

2014 TRU Youth MONITOR

They have a keen ability to

see through hype and

exaggeration and expect

honesty, integrity and

upfront communication as

a baseline

Millennials prize being true

to themselves—and expect

others to be true to

themselves as well

Not only do they value

authenticity in themselves,

but also in the companies

they buy from

81%Age 18-29

76%Age 18-29

“Companies that make

sincere efforts to invest in or

be part of my community

deserve my loyalty”

“I appreciate it when

companies make it clear

what values they stand for”

87%Age 18-29

© 72014

RATIONAL

EXUBERANCE

BRAND IN

HANDQUIET RIOT HYPOCRALYPSE

Millennial themes

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Theme #1: Rational Exuberance

Young people are more carefully contemplating their purchases than they might have a

few years ago. Rather than settling for less, these individuals see themselves as savvy

shoppers who know how to get more for less.

The Google Samsung Chromebook has revolutionized

the “standard” price of computers. At $280, the

Chromebook provides the basics of what most young

people need (Internet access) from a well-known

brand.

TJ-Maxx has created a new term that captures

the essence of Rational Exuberance: The

Maxxinista, a savvy and sophisticated young

woman who saves while still staying in style.

Marketing Implications

• Capitalize on the joy young people feel about finding good deals and sharing their success with others.

• Be clear about your value proposition and explicit about why smart, savvy shoppers should want your product in

their lives.

© 92014

Theme #2: Brand in Hand

From purchase influence to social influence, the youth consumer has a lot of impact on

brands, thanks to the reach of their devices. It’s critical to understand how they

communicate both on- and offline in order to maximize their interactions with brands

for both sides.

Marketing Implications

• Don’t feed the trolls. A savvy social media manager knows whether to take a step back and ignore the bait OR

to push forward and make your brand shine.

• Bring online symbols and customs into offline experiences with your brand.

Nordstrom has taken the simple yet effective

approach of tagging Pinterest-popular

merchandise in store with the Pinterest logo.

Shoppers know that a product is social media

approved—which can be more important than a

good review in the mainstream media.

© 102014

Theme #3: Quiet Riot

Taco Bell took advantage of the accessibility and

immediacy of social media by granting a fan’s wish

to have a Speedo that read “Think Outside the

Bun.” Capitalizing on brand advocacy by being

attentive and accessible can create affinity not

normally built by traditional marketing campaigns.

Marketing Implications

• Pay attention. Be aware of conversations happening around your brand, listen to fans and critics, and respond

as appropriate (remember, don’t engage the trolls!)

• Brand affinity can be either won or lost in the battle against the Quiet Riot.

TACO BELL

The proliferation of social media has created an ongoing, self-sustaining existence

online, whether you encourage it or not. Conversations are being had with you and

about you. Paying attention is mandatory.

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Theme #4: Hypocralypse

Beware: An army of tech-enabled fact-checkers is ready to surface your every

half-truth and misstep.

Celebrities and brands often get in hot water

on Twitter and other social media with followers

who call out hypocrisy or bring up old

scandals. Recently, Jenny McCarthy was the

target of backlash on Twitter over her

controversial anti-vaccination stance.

Marketing Implications

• Being aware of fans’ and critics’ opinions of, and issues with, your brand can keep you from becoming easy prey.

Think through all consumer-facing actions as if they could go wrong and take measures to protect your brand.

© 122014

Rules for brand relationships

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CONSUMERS

FIRST,

MILLENNIALS

SECOND

INCUSIVITY

OVER

ETHNICITY

LEGACY

BRANDS

CAN’T REST

ON THEIR

LAURELS

MONITOR

CATEGORY

THREATS, NOT

JUST BRAND

THREATS

MILLENNIALS

CONNECT

WITH BOTH

BRANDS AND

COMPANIES

© 132014

Rule #1: Consumers first, Millennials second

Connecting to young people is one thing, but pandering to them is

another – and marketing-savvy Millennials know the difference

Targeting your brand specifically towards young people and you run

the risk of it being seen as something to grow out of. Millennials are

increasingly practical about purchase decisions in the wake of the

Great Recession, and they are completely willing to do the same

cost/benefit analyses as consumers of any other generation.

Case Example

Youth retail leaders, including Abercrombie, Aeropostale, and

American Eagle, have seen staggering revenue losses as of recent,

and experts see no signs of a rebound. High unemployment, coupled

with faster fashion cycles driven by the Internet, have driven young

shoppers towards more alluring, fast-fashion outlets, such as H&M

and Forever 21. Failing to adapt to their target’s changing attitudes

and sensibilities could signal the demise of the once key players in the

youth retail category.

http://www.nytimes.com/2014/02/01/business/retailers-ask-where-did-teenagers-go.html

© 142014

Rule #2: Inclusivity over ethnicity

Inclusivity is an inherit need state for Millennials today, meaning

brands must see beyond simple ethnic diversity and embrace

diversity in all its forms

Actions like expanding product lines and price-points and targeting

communications to appeal to different genders, ages, interests, and

tastes are, quite simply, the table stakes for engaging this generation.

Case Example

Coca-Cola ran an ad during the Super Bowl showing Americans of

various racial, ethnic, religious, and sexual orientations as “America

The Beautiful” is sung in several different languages. When faced with

backlash by some via news outlets and social media, Coca-Cola

issued a press release stating that the ad was “a great example of the

magic that makes our country so special, and a powerful message that

spreads optimism, promotes inclusion, and celebrates humanity –

values that are core to Coca-Cola.”

https://www.youtube.com/watch?v=443Vy3I0gJs

© 152014

Rule #3: Legacy brands can’t rest on their laurels

Social media provides smaller brands with the means to quickly

establish reach and awareness out of proportion to their size

While the younger generation does appreciate a brand with

longevity—often seeing it as a proxy for quality—they will not hesitate

to switch to a different brand if they feel it connects better with them.

Top brands, despite being nearly synonymous with the categories they

represent, must preserve their momentum. This doesn’t mean drastic

recipe changes or line extensions, but rather simpler, tactical changes

to show the brand in a more youthful light.

Case Example

Sperry, the footwear brand most notorious for manufacturing boat

shoes since 1935, has seen a recent uptick in popularity among

Millennials, based on their comfort and relatively low-cost cool, in

addition to a refresh of their advertising and brand properties, which

aim to target younger consumers, without straying away from the

brand’s nautical roots.

http://www.nytimes.com/2014/02/01/business/retailers-ask-where-did-teenagers-go.html

© 162014

Rule #4: Monitor category threats, not just brand threats

In today’s environment of disruptive change, entire categories are

just as subject to market changes as individual brands are

Brands faced with the prospect of a declining category can buy some

time by owning the category they operate in, but they must use that

time wisely by innovating and looking towards the future.

Case Example

In an attempt to avoid being viewed as outdated, well established

hotel chains are taking measures to attract Millennials. Starwood’s

Element and Aloft and Hyatt’s Hyatt Place have been designed with

modern amenities and simple design to appeal and cater to a new

generation of Millennial travelers. Meanwhile Holiday Inn (and even

Country Inn!) have both recently undertaken initiatives to “refresh” the

aesthetics of their locations to be more welcoming and inviting to this

target.

© 172014

Rule #5: Millennials connect with both brands AND corporations

The difference between corporate marketing and brand

marketing is understood by twentysomethings, which leads to a

decision for corporations: is it more important that Millennials

respect the corporate umbrella, or buy (and buy into) the brands

underneath it?

While most day-to-day interaction is with the brands, it is important not

to neglect the corporate image entirely. Millennials are socially-

conscious consumers, and in today’s world of instant information and

viral communication, it’s safe to assume that they will quickly come to

understand what they think a corporate parent stands for, and that

could lead to changes in attitudes and behaviors related to the brands

themselves.

Case Example

Recently, popular online dating site OKCupid interrupted access to the

site via Mozilla’s Firefox browser and displayed a message informing

members that Mozilla’s CEO was an outspoken opponent to equal

rights for gay couples. The message urged members to choose

another browser to access OKCupid as a result, and reinforced

OKCupid’s commitment to bringing people together, regardless of their

sexuality. News of the message went viral, and a mere three days

later Mozilla’s CEO stepped down and the company issued a public

apology. http://valleywag.gawker.com/that-was-relatively-quick-after-lots-of-angst-and-argu-1557731647

© 182014

Thank you!

Christian Ruzich christian.ruzich@thefuturescompany.com 312.951.4815

Joe Mandrino joe.mandrino@thefuturescompany.com 312.951.4811