While Gen Y’s relationship with brands has long been known to be unlike their parents’, a new study from the Boston Consulting Group reveals just how different they really are. That applies to both the details of marketing (celebrity endorsements are incredibly important, for instance) and in the big picture, in the way they expect all brand communications to be a two-way street.
Called “The Reciprocity Principle: How Millennials Are Changing the Face of Marketing,” the study is based on 4,000 Millennials in the U.S., the 13- to-34 year-old segment that is expected to account for an estimated $1.3 trillion in direct annual spending. Overall, the study found that Gen Y sees status, success, and luxury as increasingly important, especially among males. But the biggest differences are found in the way they engage with brands, and their expectation that brands listen and respond to them.
“The conventional linear and rational approach to marketing has been a process in which companies defined their brands and pushed brand and marketing messages at consumers,” says BCG partner Christine Barton, the lead author, in the company’s report. “But this doesn’t work well with Millennials, who want and expect a two-way, reciprocal relationship with companies and their brands. As a result, modern marketing has become an ecosystem driven by interactions among marketers, customers, and potential customers, who help define brands and influence their success.”
And while many of the report’s findings are predictable -- that Gen Y is more engaged in social media and mobile technology, for example, or that they demand 24/7 access -- the numbers behind them are eye-opening. Some 52% of Millennials use social media to “like” a brand, compared with 33% of Baby Boomers. And twice as many Millennials as Boomers use their phones in stores to check prices, look up product information, or shop for sales.
While 61% of older consumers are swayed by the opinions of medical or financial experts in marketing, less than half of Gen Y consumers are. Instead, they rely on the opinions of family, friends, and strangers. And Millennials are intensely starstruck: They are twice as likely as Gen Xers (ages 35 to 49) to be influenced by celebs, and four times more likely than Boomers.
They are also far more focused on reputation, and 50% say they believe brands “say something about who I am, my values, and where I fit in.” Not surprisingly, 48% say they try to select brands that actively support social causes.
The study also found some sharp breaks between male and female Millennials. While young men are much more attentive to external recognition, and mention values such as status, success and craftsmanship, female Millennials are more stressed out. And in the last two years, they have begun to push back against digital demands, and say they are more consciously making efforts to unplug, focus on fitness and simplify their lives.
Marketing approaches that most appeal to both genders are those that touch on what Millennials see as their generation’s personality: Tech-savvy, modern, rebellious, trendy, energetic, hip, and funny.
BCG urges companies to create a “cross-media, cross-channel, cross-device brand presence” -- one that “reinforce their authentic reputations and brand soul with the relevant values, personality traits, and communications. They should relate to Millennials by moving from push communications to two-way, open dialogue. And they should cultivate referrals among Millennial customers and employees.”