Are You Going To Work With Gen Y Or Against Them?

When I was 16 years old I went out looking for my first car. Together with my parents, I had set a budget of $8,000. For a 16 year old this felt like $100,000, but to the people trying to earn my business, that $8,000 was enough to sell me what ever they wanted to sell me. I found a beautiful 1968 Ford Mustang at a local car lot. My mom drove me down to the see the car, and I ran excitedly toward the Mustang.

The salesman approached me, and I asked him how much the car cost.

He asked me how much I was looking to spend.

I told him $8,000.

And as you may have guessed he told me that was exactly the price of the Mustang.

Lesson learned.

Now, what is the lesson for you?

As a marketer, you are in a position to manipulate your customer if you so choose to. But that doesn't mean you should. And when dealing with Gen Y you can either use their characteristics to work with them, or you can use their characteristics to take advantage of them. As you can imagine, in the spirit of the greater good, you should use your market research to work with them.

So, now that we have covered your obligation to Gen Y, let's take some time to learn about them financially.

1. Gen Y is wracked with debt, and they don't realize the ramifications of this. The average person graduates college with over $20,000 in student loan debt. This is actually a good example of selling something (loans) to a group of people that aren't in the best position to make a good financial decision.

I'm not discrediting the importance of a college education, but I'm simply pointing out that 18 year olds are committing themselves to levels of debt that they can't possibly comprehend. Understand that it's quite possible that your product or service could contribute to this train wreck of debt.

2. Gen Y either doesn't care about planned obsolescence or doesn't know what it is. Either way, planned obsolescence will continue to break (financially) Gen Y until it's no longer an industrial trend. Planned obsolescence, simply put, is a manufacturing strategy that encourages customers to always buy the latest greatest thing.

This is generally accomplished through a slight tweaking of product features, and then marketing the hell out of the feature changes. The customer ends up buying the features, and ignores the fact that the previous product they own is still a very workable solution.

Gen Y always wants the latest greatest thing because they haven't caught on to the game of planned obsolescence. Are you going to perpetuate the practice of planned obsolescence? Or are you going to build a product or service solution that is a long-term solution?

3. Gen Y has created a group of expenses that I call The New Necessities. This is a category of spending that didn't exist 15 years ago. The category includes Internet access, mobile phone charges, cable, designer coffee, and lease payments. Young people don't think twice about paying big money for cell phones and coffee.

I guess that's why there are so many highly caffeinated broke people face down into their cell phone texting their highly caffeinated broke friends. Gen Y doesn't see anything wrong with spending money on these items, and if your product or service can find it's way on to this new sacred list, then you are golden.

4. Gen Y has more bailout plans than the federal government. And as is the case with the newsworthy bailout, Gen Y bailouts are also ill conceived. Gen Y will not hesitate for a second to solve their financial problems in two very distinct ways. They will use their credit cards in a heartbeat, and they will pick up the phone and call their parents in an instant.

Ask a group of Gen Yers their backup plan, and these two solutions will come up time and time again. As a marketer, this is a very important thing to know. Gen Y never says die; they will find a way to afford the things that they want.

You may be thinking that Gen Y is a generation that is guilty of the "keeping up with the Joneses mentality," but they aren't. Their desire to have the things that they want is personal. They don't particularly care what their friends have or don't have. That is more a characteristic of Gen X.

This nugget of truth paired with the financial characteristics outlined above will certainly help you understand this generation from a financial perspective. And this understanding should help you market to this elusive yet important part of your customer base.

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6 comments about "Are You Going To Work With Gen Y Or Against Them? ".
  1. Kathy Sharpe from Resonate Networks , July 17, 2009 at 1:53 p.m.

    It is not marketers jobs to save consumers from their own stupidity regardless of their age. It is our job to sell products without deceit. If we exploit our understanding of a target to do that, well so be it.
    The recession is forcing Gen Y to face reality (as their parent's portfolios suffer). What that process will to them is the question

  2. Candice Nigro from New Jersey Credit Union League , July 17, 2009 at 2:02 p.m.

    There are better and less deceitful ways to get the business of Gen Y. If you did your research you would know that Gen Y is more likely to work with a company that is honest and seemingly cares about them, their friends or family, or one of the causes they agree with. They are more likely to work with a company on the recommendation of someone they know or trust or someone they don't really know at all who posted a great blog post online. Gen Y may want the "latest and greatest" things but let's face it, that's how the Baby Boomers raised them—most Baby Boomers were trying desperately to give their children (Gen Y) more than what they had. If you really want to reach out to Gen Y, bottom line, just be honest with them or short of that find some sort of cause to get behind that's hip, innovative and helps something or someone.

  3. paul myers , July 18, 2009 at 3 a.m.

    Man, I need a new MacBook with the anti-glare screen. I could hardly read this article while sitting outside Starbuck's in the sun!

  4. Nancy Elswick from MediaQuest , July 18, 2009 at 10:14 a.m.

    Peter - according to cultural marketing researchers, this generation prefers The Millennials versus Generation Y - which is merely a younger sibling to GenX.

  5. Kat Rice , July 18, 2009 at 2:43 p.m.

    As a member of Gen Y I have to say some of this article feels over simplified. Most of Gen Y is getting out of college and into jobs now and we are not all broke (anymore). And in the last few years, with the economy, most of us our doing our best to 1. be out of debt and 2. not depend on our parents. More and more people I grew up with are tossing their credit cards to stay out of trouble. However, I do think we feel being connected is necessary and will cut other costs to do so. I just caution people not to stereotype us all.

  6. MONIROM S. , August 7, 2009 at 1:25 p.m.

    In the context of this article almost everything "attributed" to Gen Y can also be attributed to Gen X, baby boomers etc. Each generation has its own set of "new necessities" and its own set of "bail out plans" (it just used to be called a support system).

    I agree with Kathy Sharpe. It is our job to sell products without deceit.

    However,if we exploit our understanding of a target to do that, in a way that goes against our clients scruples, then we are not advertisers or marketers — we are hucksters. Hucksters more intent on making the sale than maintaining the lifelong relationship with our customers. If we do this we are not only working against our consumers ( millennials, gen x, y, baby boomers etc.) we are also doing a disservice to our clients.

    Just as we should not stereotype based on race, creed, color, age or sexual orientation, we should avoid doing so based on generational classification. Otherwise, how would this "slacker" from generation X have the time/drive to write this comment.

    PS: If you also haven't noticed, being wracked with debt in this economy does not seem to be a trait you can pin on just Gen Y. In fact, Gen Y is inheriting the financial missteps of their parents and grandparents. (the deficit, the billion dollar bail outs, the Trillion dollar stimulus packages, the social security time bomb...)