Many of you are selling or promoting products and services to the Millennial Generation. But who are they and how do we market to them? Nielsen recently published an article “How Migrating Millennials Will Change the Retail Landscape by 2020” prompting further discussion in the field about this generation. We are all fascinated by this generation – how do we reach them, what values drive them, and what are their shopping behaviours? The Millennials are now the largest consumer group and they will soon surpass the Baby Boomers and Gen Xers as the biggest spenders.
Some of you may be wondering what happened to “Gen Y” title or what age groups the Millennials refers to. Here is some information to help clarify “Who are the Millenials?”
Millennials: Age and Labels
There is quite a bit of discrepancy between the start and end dates of the Millennial generation. In Australia, McCrindle Research define the generational profile as being born between 1980 and 1995. This makes the Millennials aged between 21 and 36. The Nielsen Company describes the Millennials as being born between 1997 and 1995 and investment bankers Goldman Sachs categorise the generational group as being between 1980 and 2000.
Authors William Strauss and Neil Howe have been widely credited with naming the Millennials (according to journalist Bruce Horovitz). Prior to that they were referred to as “Generation Y” which the Ad Age used in an editorial in 1993. Nowadays, the “Gen Y” tag has been replaced by the Millennials title.
In February 2015, McCrindle reported that the Millennials equated to 22% of the Australian population, or 5.22 million. They also estimated that they equated to 34% of the workforce and project that in 2025 that they will equate to 33% of the workforce.
In regards to the other generations, Baby Boomers also make up 22% of the population (5.17 million) the Gen Xers make up about 20% (4.78 million) and the next generation, Gen Z, make up 18% of the population (4.43 million).
Whilst the Baby Boomers currently hold a greater percentage of Australia’s personal wealth, this figure will change as more Millennials enter the workforce.
In the United States, Goldman Sachs reported that the Millennials are now the biggest generation in US history. They have stated that there are 92 million Millennials compared with 61 million Generation Xers and 77 million Baby Boomers (source: US Census Bureau). They are the first digital natives, they’re getting married later, are waiting longer to have children, are choosing to live with their parents longer but hope to buy a home some day.
Well, what does this all mean? It means that marketers, retailers and manufacturers will see the importance of the Baby Boomers diminish as the Millennials disposable income increases over the next two decades. As this group matures, businesses will need to take into consideration the Millennials consumption habits, spending needs and buying preferences.
As Nielsen reported, “Millennials will be on the move by 2020 – both with their home location and their busy schedules.” Therefore it is important as marketers and business owners that we look for solutions that meet their needs.