The “New Normal” of The Millennial Era
As Millennials have taken the lead as the largest generation of consumers living in the U.S. with over 80 million members and a direct spending power of $200 billion many of us in marketing, advertising and technology are positioning to understand and focus on the behavior that drives the Millennial consumer patterns. Millennials clearly have their own rules and their own tools and are poised to disrupt a lot of traditional industry assumptions around marketing, sales and servicing this community.
Millennials entered the working world at a time when the economy was in a slow recovery stage, the housing market had crashed and jobs were not readily available with over 30% of Millennials still living at home in order to make ends meet. The path to financial security was uncertain. The traditional path of getting good grades, attending a good university and getting a good job was not the reality that they experienced.
The long-standing institutions of our North American society including universities, Fortune 500 companies and financial institutions and our government were all in a state of flux and a “new normal” emerged which is based on constant change and uncertainty. This “new normal “broke from the traditional paths to success and loyalty that had been the bedrock of our business environments and society.
Discovering The WHY Of The Millennial Era
This new Millennial Era coupled with radical digital transformations that is impacting every industry brings with it new expectations and new product and service delivery models that are being developed to serve this new Millennial Era. Understanding why Millennial’s think, act and consume differently is important.
Merkle conducted a Neuroanalytics® study that examined millennials’ underlying motivations when making purchase decisions. Discovering the WHY of the Millennial’s buying behaviors. Mike Adamson, Customer Experience Strategist at Merkle explains what they found and how it may redefine the entire concept of “cool.”
“Neuroanalytics is a type of motivational research garnered from a proprietary combination of cognitive psychology and advanced analytics. It’s designed to discover the subconscious motivations that ultimately drive our decision-making process and quantify those motivations’ associations with product attributes and benefits. In other words, the Neuroanalytics process creates a map of why we buy products and brands instead of why we think we do.”
Adamson, explains “ this study revealed that one of the strongest motivations driving millennials’ brand choice in the financial services sector is gaining the respect of others. Millennials care so much about how they’re perceived that respect can be a powerful motivator in even the driest of categories.
And this is where it gets interesting – the primary avenue used to gain respect is to become self-reliant. Anytime a brand could provide independence or increase even the perception of responsibility, it was seen as a means to gain the respect of others. One might reasonably think things like saving money, getting a good deal, staying in a budget, and making smart decisions were tied to financial security, but each of those attributes was perceived as a way to ultimately gain the respect of others via self-reliance.
This means fiscal responsibility has become more than something to aspire to – it’s become cool”
The research concludes that millennials are increasingly rejecting the materialism of Gen X in favor of the Greatest Generation’s frugality. Having to work two jobs or live with one’s parents has made financial independence the new threshold to success; comprehensive auto insurance and a smart mortgage are the new status symbols for a generation saddled by debt and stagnant wages.
Motivational research enables brands to craft messaging that resonates with a specific type of individual. Ultimately, brands should understand the entire landscape of their audiences’ motivations, then craft campaigns that appeal to each motivation. With today’s people-based marketing capabilities, it’s possible (with analytics) to start targeting individuals by their motivation. Do that and you’re essentially telling every customer exactly what they want to hear at their very core.
As you explore new ways to connect with millennials and tap into their expanding buying power, think about what they really want in life and how you can deliver it. Challenge your strategy and creative teams to look past the obvious product features and address the deep personal values that shape each customer’s decisions
Industries Being Forced into Transformation
Industries of all sizes and shapes are under pressure to transform. Let’s explore the banking industry as an example, the banking industry is under radical transformation with one-third (33%) of Millennials believing that they won’t need a bank at all in five years.
According to an Accenture survey, 40% of Millennials said they would consider keeping their money with a technology firm such as Amazon, Apple or Google, over one of the major banks.
Recently, Resonate issued a joint study with the ANA on Millennial banking practices. The report, “Winning on the ‘Why’ in Financial Services,” is about the banking industry’s marketing future, including the significance of targeting via the financial values of Millennials.
The report provided insights into the following key areas for Financial Services marketers to focus on:
Create Messages that Emphasize Values Over Life stage
When it comes to utilizing financial services, a Millennial’s age could be less significant than the group’s values and motivators. Consider this: according to Resonate’s 2015 survey of 6,500 Millennials, more than half (56%) of the generational group rated financial security as “not important” when making life decisions. They rate financial security below values such as “sharing experiences,” “personal freedom,” and “self-fulfillment.”
“Digital Friendly” Outranks “Millennial”
Focusing solely on the Millennial demographic differences alone can be deceiving. According to Resonate 2015 data, “ 23% of all U.S. adults would consider an online-only bank, yet the majority (63%) are not Millennials.” This large “digital friendly” cohort is defined not by age, but rather by their embrace of technology. This suggests that focusing on “digital friendly” over age would be more effective in marketing messaging. And, diving deeper into the values of this “digital friendly” group – such as their affinity for green lifestyles, and their wanting a sense of personal accomplishment – could go even further in crafting campaigns.
Millennials are Motivated by Mobile, and Mobile by Millennials
When it comes to finance, Millennials want everything to be mobile. But, Resonate data shows this mobile-friendly banking group is less defined by age, than by their affinity for mobile tech. Millennials make up less than half (48%) of mobile banking users. Mobile banking users of all ages want to do more than check account balances or deposit checks on their phones – they are significantly more likely to want to open new accounts and initiate loans online, too.
In summary, as you design your marketing campaigns, develop your customer engagement models and deploy your latest technologies Think “Digital Friendly”, Think Mobile and Think About The Why.