To gain an in-depth understanding of this enigmatic and influential generation, we surveyed nearly 800 Millennials and more than 1,700 non-Millennials in the U.S. as part of our 2013 Global Consumer Sentiment Survey. We complemented this survey with a 2013 study of more than 400 U.S. Millennials and nearly 1,000 non-Millennials, covering values, brand engagement, and marketing tactics. Finally, we compared 2013 results with findings from 2012 global research involving more than 1,200 U.S. Millennials. Our global research and experience suggests that our findings about U.S. Millennials and their impact on consumer marketing reflect similar trends among Millennials in other developed countries.
We compared the responses of Millennials with those of consumers of other generations—Gen-Xers (ages 35 to approximately 49), baby boomers (ages approximately 50 to 69), and the so-called silents (ages approximately 70 and older). There is great diversity within the Millennial generation itself, so we further segmented this generation into two age cohorts—younger Millennials (ages 18 to 24) and older Millennials (ages 25 to 34). We also segmented Millennials by gender and income group.
Although U.S. Millennials are hardly a homogeneous population, we believe that generalizations based on our research illustrate the profound impact this generation is having on marketing—and are useful in understanding the reciprocity principle in terms of reach, relevance, reputation, relation, and referral.
Reaching Millennials. It is not surprising that U.S. Millennials are considerably more engaged with digital technology and social media than older generations. In fact, 37 percent of younger Millennials said that they feel as if they are “missing something” if they are not on Facebook or Twitter every day, compared with 23 percent of non-Millennials.
Moreover, Millennials, as heavy users of portable devices, are also connected to brands wherever they go: 67 percent of Millennials reported that they use smartphones to access the Internet. That compares with 40 percent of baby boomers and just 20 percent of silents. Furthermore, 82 percent said that they access the Internet with laptop computers and 47 percent with tablets (up from 26 percent in 2012), both significantly higher than older generations.
U.S. Millennials are also more likely to use portable media devices on the go: 46 percent said that they access search engines such as Google while they are in a store, compared with 29 percent of baby boomers. Around twice as many Millennials as boomers said that they check prices, look up product information, or search for coupons or promotions on their mobile devices while they are in a store. Forty-three percent of Millennials—compared with 25 percent of boomers—reported that they search for information online while in stores.
Millennials also engage with brands more deeply through social networks: 52 percent said that, at least occasionally, they use their mobile devices on social media to note that they “like” a brand, compared with 33 percent of boomers. Also, 39 percent post product reviews, 35 percent share links about products on LinkedIn, and 32 percent said that they follow brands on Twitter. In each case, the percentage of Millennials who reported these activities exceeded that of boomers by 150 to 250 percent.
Responding to our 2013 survey, the 43 percent of U.S. Millennials who reported that they check for coupons or promotions on their smartphones while they are in a store represent a dramatic increase from the 24 percent who responded similarly in 2012. As connected consumers, therefore, Millennials can—and do—engage with brands everywhere they go.
Establishing Relevance. It is more difficult through traditional marketing to convince a U.S. Millennial than an older U.S. consumer that a brand is relevant to him or her. Millennials turn to much wider networks for advice, for example. The Millennials we surveyed reported that, on average, their purchasing decisions are influenced by five people, compared with three for boomers.
Millennials are also influenced by different types of people. Traditionally, companies have used testimonials from “experts,” such as doctors or financial advisors, to convince consumers of the merits of a brand. But less than half of Millennials said that they trust expert advisors, compared with 61 percent of non-Millennials. And a mere 4 percent of Millennials—compared with three times as many boomers and silents—said that they are most influenced by experts. In our 2012 survey, we also detected a marked shift among Millennials away from advertising as a stated trusted source of brand advice.
Instead, U.S. Millennials reported that they are most influenced by family, friends, and strangers. Asked to name the type of people who influence their purchasing decisions, 59 percent of Millennials listed friends—compared with less than half of non-Millennials. Of the Millennials, 52 percent cited spouses and partners, and 51 percent cited parents; 33 percent, roughly twice as many as non-Millennials, listed strangers, and 23 percent cited celebrities. Millennials were twice as likely as Gen-Xers to say that they are influenced by celebrities, four times more likely than boomers, and ten times more likely than silents. Indeed, the influence of celebrities on Millennials appears to have increased since our 2012 survey, especially when it comes to apparel, lifestyle, and luxury categories and brands.
The Internet is a more influential source of consumer information for U.S. Millennials than for older generations: 50 percent of younger Millennials and 47 percent of older Millennials said that they trust retailer websites, compared with 33 percent and 36 percent of Gen-Xers and boomers, respectively. Millennials also expressed significantly greater trust in company social media as well as digital advertising.
U.S. Millennials display levels of egocentrism that exceed what may be expected considering their youth. This inward focus can be seen today in the values they expressed: 35 percent said that they believe that beauty is more important to them than it was two years ago, while 37 percent cited wealth and 45 percent, professional success. Significant percentages of Millennials also said that status, luxury, consuming, adventure, excitement, and travel are increasingly important to them. Non-Millennials place much higher importance on such values as patriotism, spirituality, religion, and calm. (See Exhibit 1.)
Our survey found that both Millennial men and women focus on themselves. They differ, however, in their emphasis on specific values. Male Millennials attach a greater importance to external recognition, citing values such as status, professional success, luxury, and craftsmanship.
The responses of Millennial females seem to indicate greater anxiety and stress: among the leading values that they said had become more important over the past two years were disconnecting and unplugging, fitness, and simplifying. U.S. Millennial females’ values are consistent with our 2012 findings. The values of Millennial males differ even more starkly from those reported by females in our 2012 survey. Females cited such values as tradition and stability, as well as reassuring, familiar, and grounding influences such as locally grown, home, local communities, family, and spirituality. In 2012, females also placed greater emphasis on such new status-currency values as wellness, saving, and naturalness. It is surprising that far fewer female Millennials cite professional success as more important in our most recent survey. (See Exhibit 2.)
Burnishing Brand Reputation. Millennials identify with brands more personally and emotionally than do older generations. Fifty percent of U.S. Millennials ages 18 to 24 and 38 percent of those ages 25 to 34 agree that brands “say something about who I am, my values, and where I fit in.” (See Exhibit 3.) That sentiment is substantially stronger among Millennial males than females and among those in middle- and high-income brackets (around 40 percent) than those who consider themselves as being in lower-income brackets (27 percent). In our 2012 survey, 59 percent of Millennials reported that the brands they bought reflected their style and personality; 40 percent said that they were willing to pay extra for a brand or product that reflected the image they wished to convey about themselves, compared with only 25 percent of non-Millennials.
Reflecting the new status currency, Millennials view brands as extensions of their own values and status. To win their loyalty, therefore, companies must do more than deliver high-quality products. Indeed, only 22 percent of U.S. Millennials said that brands must “stand behind” their products, compared with 42 percent of boomers. Through their actions, storytelling, and endorsers, companies should express the traits and affiliations that Millennials wish to project about themselves.
Cultivating Relationships. To sustain Millennial loyalty to their brands, companies must engage Millennials individually and in small groups through direct, two-way communications. More than other generations, Millennials desire opportunities to interact with brands, to be listened to anywhere and anytime, and to have personal, timely, and straightforward communication about their concerns and experiences.
Millennials were asked to name the most important things brands can do to “engage and interest” them: their top two responses were to reward their loyalty with discounts and promotions and to “be authentic.” These were also high on the lists of Gen-Xers and boomers. But more Millennials than other generations also listed being available, supporting causes, and having a brand personality. (See Exhibit 4.)
A brand’s availability 24-7 is significantly more important to U.S. Millennials than to others. Nearly twice as many Millennials as boomers cited that benefit as the most important thing that brands can do to engage them. Moreover, females expressed a stronger desire that their loyalty be acknowledged with recognition, rather than blanket material rewards, implying that a company should have knowledge of them as individuals and that each of them has a relationship with the brand.
Brands must also connect with Millennials’ new status currency. This generation has a stronger affinity than other generations for brands that express themselves as socially responsible. Forty-eight percent of young Millennials reported that they “try to use brands of companies that are active in supporting social causes.” When asked whether “brands should help those in need,” more Millennials than the U.S. average agreed that they are more likely to buy a product if they know that the company is “mindful of its social responsibilities” and that they buy from companies that “show concern for the environment and sustainability.” Furthermore, 45 percent of U.S. Millennials said that environmental stewardship is more important to them as a value now than it was two years ago.
Inspiring Millennials to Make Brand Referrals. Engaging U.S. Millennials after a purchase is not only critical to keeping them as customers; it is important also because Millennials are more eager than other generations to share their opinions with friends and on social networks. More than half of U.S. Millennials said that people seek them out for their knowledge and opinions of brands, compared with only 35 percent of boomers. More Millennial males than females said that they think that they are sought out for their brand and purchase opinions. In fact, Millennials said that they believe that they influence the brand and purchase decisions of around four family members and friends. Boomers, by comparison, say that they influence around two. That means Millennials can become especially powerful cross-generational advocates of brands—as well as influential critics. A company’s capabilities in promoting advocacy and social media, therefore, are increasingly important.
More than half of U.S. Millennials said that they are willing to share their brand preferences on social media, compared with 31 percent of baby boomers. More Millennial females than males said that they are willing to share brand preferences over social media or online. Millennials are around 2.5 times more likely than boomers to at least occasionally share a social-media link that references a brand or product and to follow brands on Twitter. They are also far more likely than boomers to support their favorite brands online: 52 percent said that they post likes of a brand on social media such as Facebook, and 21 percent reported that they do so “every time” or “almost every time.” Also, 39 percent said that they post reviews of brands or products, 27 percent reported that they reference a brand in blog posts, and 26 percent said that they answer satisfaction surveys on mobile devices.
The brand choices of U.S. Millennials are also more likely to be influenced by peers than are those of older consumers. In fact, 28 percent of younger Millennials and 23 percent of older Millennials said that they are more likely not to purchase or use brands that their friends disapprove of. Only 12 percent of boomers agreed. Millennial males are twice as concerned as females with peer approval of their brand affiliations. This means that peer recommendation or disapproval should influence Millennials’ purchasing behavior more than it does that of non-Millennials.
BCG research confirms that brands that are highly recommended by consumers outperform brands that are heavily criticized. In a sample that we studied for a recent report, there was a 27-percentage-point difference in top-line growth between brands that scored highest in terms of advocacy and those with the lowest scores.
Keeping the Message Relevant. To engage and win over Millennial consumers, it is critical to make sure that marketing messages, brand communications, and tone resonate. Millennials’ response to the same visual images differs from that of their parents, for example. Companies should strive for messages that speak authentically to the attitudes, beliefs, preferences, and personalities of U.S. Millennials. Because Millennials are such a diverse generation, moreover, communications should also be tailored to appeal to Millennial segments.
One general trait that clearly distinguishes Millennials from older consumers is their optimism. Although their job prospects were hit disproportionately hard by the economic downturn, 69 percent of U.S. Millennials reported that their personal situations and outlooks are bright, compared with 42 percent of non-Millennials. Furthermore, 58 percent of Millennials overall said that they enjoy “peace of mind,” 60 percent report happiness with their lives now, and 47 percent said they “have enough fun.” Twice as many Millennials as Gen-Xers said that they believe their generation will have a better life than previous generations.
The tone of marketing communications should also reflect the Millennial “personality.” To get a sense of how Millennials view themselves, we asked survey respondents to cite terms that uniquely describe their generation. The most common prompted responses in 2013 were technologically savvy, young, modern, risk taking, rebellious, hip, and funny or humorous, and—unprompted—smart and fun. Millennials also cite less flattering self-descriptions, such as lazy, arrogant, snarky or sarcastic, and self-centered. Trendy and energetic were more popular in this year’s survey than in last year’s.
This self-image differed dramatically from that of boomers, who more commonly mentioned such traits as ethical, religious, selfless or giving, and nostalgic. Millennials also expressed less interest in several traits that rank high for boomers and Gen-Xers, such as responsible, hard working, and ambitious.
Do all three generations share any common ground? Mass traits that appeal most to Millennials as well as Gen-Xers and boomers include social, open-minded, multitasking, creative, and environmentally conscious. Millennial traits that should also build affiliation with Gen-Xers are diverse, individualistic, and innovative. (See Exhibit 5.) In our 2012 survey, Millennials also cited authentic, original, and clever.
The choice of visual imagery is also critical. Most marketers are sensitive to the need to reflect ethnic and racial diversity in visual images. When marketing to Millennials, they must also be increasingly sensitive to diversity in family structures and gender roles. Depictions of traditional nuclear families do not resonate with many Millennials. More and more, parents are regarded as “friends.” More moms work; more dads stay at home. Marketers should also take into account that, given their age, Millennials are in different stages of life. Many are still in their late teens, and many who are in their twenties are still living at home with their parents. Some are on their own for the first time, while others already have spouses and children.
Brand imagery, messages, and promotions should also take into account that many U.S. Millennials are highly group oriented, even when it comes to activities such as travel and eating out. Companies should, therefore, consider using visuals that are multigenerational and that show groups—friends, classmates, work colleagues, multigenerational families, cultural “tribes,” or strangers coming together for a common cause.