The generation that many groups have characterized as lazy and self-absorbed is suddenly entering the parental space. Millennials are starting to become moms and dads. As a matter of fact, 10.8 million American households are now headed by Millennial parents, according to a recent study by Barkley, “Millennials as New Parents.” However, according to more than one source, the generation that many marketers thought they had pegged in terms of priorities and values may be very different than originally perceived. It seems that, especially once they become parents, Millennials take a more modest approach to consumer habits, valuing quality over quantity and practicality over status.
As highlighted by David Gutting, VP, Strategy Director at Barkley, members of Generation Y have been exposed to more in their lives that they receive credit for. “First let’s remind ourselves that the oldest Millennials became young adults around 1999. In that time, they have experienced the dot-com bust, September 11th and large banking and housing crises,” he points out in a MillennialMarketing.com article. It appears the jump to modesty isn’t as extreme as it seems. So what does this mean when it comes to Millennial parenting? In many cases, it means ego is left at the door while the concept of “needs versus wants” steps in to take its place.
The same Barkley study found that while “cool” brands such as Sephora, Apple and H&M are over-indexed by Millennials prior to having children, they are greatly under-indexed after that. As a matter of fact, brands such as Kohl’s, Walmart and Kmart not only fill that void, but Generation Y favors those brands even more than Baby Boomers and Generation X.
The Millennial parent’s value of a dollar shouldn’t come as any surprise. Many of them were just entering the workforce as the recession hit in 2008 and have had to deal with high unemployment rates during a point in life when they should have been making inroads in their young careers, as previous generations did. As a matter of fact, 44% of Millennial parents consider themselves “very financially stressed,” according to SoCalledMillennial.com.
Additionally, the concept of the “haves and have-nots” may eventually cease to exist among Millennials, particularly when considering technology brands. The reason for this is that most technology is becoming commonplace. For example, roughly 75% of Millennials own smartphones. Suddenly, owning a smartphone is not about impressing friends with high tech features. It is more about how the device can make one’s life easier. Therefore, the way that a brand presents itself will be more heavily scrutinized by Generation Y members as more become parents.
Marketers may want to take a look at these factors and reconsider their approach to reaching Millennials as the group starts living out the 21st Century version of the “American Dream.” If the goal of flashier brands is to retain Millennials as loyal customers, then highlighting usefulness or convenience will prove to be a better strategy than trying to convince them to “keep up with the Joneses.”