Millennials spend about $200 billion annually in the US. In addition, the authors argue that Millennials influence another $500 billion in spending because of their impact on their older family members, friends, and colleagues. Fromm and Garton believe that Millennials exert a lot more power and influence on society than any other demographic group. Whether you're selling consumer or business products and services, you have to start marketing effectively to this huge, influential group of consumers if you want your business to grow and prosper.
Not everybody agrees that the Millennials have this much clout. In the October 2014 issue of AARP Bulletin, there is a feature article that questions the wisdom of advertisers targeting Millennials while virtually ignoring consumers aged 50 and above. The article quotes Bob Hoffman, author of the book 101 Contrarian Ideas About Advertising: "The idea that the way to influence older consumers is by targeting younger consumers is the purest form of ageism. No one would dare argue that the way to influence women is to target men [or] to influence black people is to target white people."
The authors define Millennials as the 84 million Americans who were born between 1977 and 1995. They make up about a quarter of the US population. Generation Y is another name for Millennials.
There is not universal agreement about the definition of Millennials or Gen-Yers. In his book The Age Curve: How to Profit from the Coming Demographic Storm, Kenneth W. Gronbach defines Generation Y as the 100 million people in the US born between 1985 and 2010. Fromm and Garton included people born as early as 1977 because they wanted to study and discuss how Millennials behave after they have married and started raising children.
The Marketing to Millennials book is based upon a survey taken in 2011 and 2012 by Fromm's company, Barkeley, the largest employee-owned US ad agency, and two other institutions. They surveyed 4,259 Millennials (aged 16 to 34) and 1,234 older folks (aged 35 to 74). It's refreshing to read a marketing book that is based upon research, and not just the personal observations and opinions of one particular marketing professional. There is a lot of information in this book that can help small independent software vendors (microISVs) sell more software.
The researchers debunked the notion that Millennials are a homogeneous group. They grouped their findings into six distinct groups of Millennials, and described their attitudes and buying habits in depth. The researchers believe that Millennials' opinions are leading indicators in the areas of media consumption, advocacy, and social media usage. I think it's fair to add the consumption of tech hardware and software to that list, too.
The authors quote Bill George of the Harvard Business School: "They (Millennials) want to interact. Measure 'Return on Involvement' not 'Return on Investment.'" Before the crowdsourced ratings found in Facebook and Twitter, and before review websites such as Yelp, consumers didn't have the option to deliver instant feedback to manufacturers and marketers. Things have changed.
Today, everybody can participate. The Millennials seem to think that companies should seek their opinions. They're not just passive consumers.
The authors cite the iOS and Android business models as an example of the power of Millennials' attitudes. Apple's proprietary approach to app development lies in sharp contrast to Android's open-source approach. Even Steve Wozniak is quoted in an Electronic Frontier Foundation (EFF) report extolling the virtues of Android's open system.
In 2011, iOS owned 60 percent of the marketplace of smartphones and tablets. By mid-2012, Apple's market share dropped to 16.9 percent, and Android owned 68.1 percent of the worldwide installed base. The authors believe that Android's open approach to software development contributed to its increase in market share. And Millennials had a huge influence on this turnaround.
Software developers are continually asking the question, "What application should I develop next?" Without getting into a dialog with Millennials, it would be easy to make a bad decision.
Millennials have more Facebook friends than non-Millennials. Lots more! Forty-six percent of Millennials have 200+ friends, while 19 percent of non-Millennials do.
Even more dramatic is the contrast between Millennials and non-Millennials when asked to react to the statements "I feel like I'm missing something if I'm not on Facebook every day." and "My life feels richer now that I am connected to more people through social media."
The authors call Millennials "Digital Natives." Even though Millennials and non-Millennials spend about the same amount of time on the web, Millennials contribute and use more content in their daily lives. They're much more likely to have their own blog and their own website. They subscribe to more data and news feeds. They upload much more content to the Internet. And they're somewhat more likely to rate products and services online.
Millennials are optimistic. Although they were clobbered by the recent downturn in the US economy, the Millennials, according to a Pew study, are upbeat about their financial prospects.
Millennials are trend setters. Their tastes today will be society's preferences in the coming years.
If you're trying to market software to Millennials, you need to understand how they view themselves, and not how they're viewed by people from other generations.
The best way to learn to think like a Millennial is to buy an Xbox. So says Rudy Wilson, the former VP of marketing for Frito-Lay. Don't assume that because you were once a teenager, Wilson tells us, you understand today's teenagers and young adults.
The authors believe that you'll raise your chances of marketing successfully to Millennials if you do these five things:
- Realize that Millennials are early adopters of emerging technologies. Use these new technologies, along with the social media sites, to engage them.
- Help Millennials link up with your marketing people by creating an electronic tool that lets them speak to you directly.
- Find a way that Millennials can support your brand and, at the same time, show fellow Millennials that they know what they're talking about.
- Make your brand fun and full of adventure.
- Build a loyalty program that speaks to Millennials.
The book describes the six subgroups of Millennials - Hip-ennials, Old-School Millennials, Gadget Gurus, Clean and Green Millennials, Millennial Moms, and Anti-Millennials. There are detailed descriptions of the attitudes of each group, and suggestions for how to reach them with marketing and advertising messages. These descriptions can help software developers fine-tune the sales presentations on their websites.
There are counter-intuitive suggestions in the book that deliver insights on how to market to these folks. Ron Johnson, former VP of retail for Apple, said, "Look at the Apple Stores, which have annual sales averaging $40 million per store in a category that in 2000 everyone said would move entirely to the Internet. Today, the Apple Stores are the highest-performing stores in the history of retailing." Millennials have had a huge influence on the success of the Apple Stores. Similarly, they can make a big difference in most software developers' sales.
If you're a Baby Boomer or a member of Generation X, you need to read Marketing to Millennials. I found it to be a fascinating description of the attitudes and preferences of today's younger generation. And it gave me a lot of marketing insights about how to more effectively reach one quarter of the people living in the US.