5 Ways Millennials Have Changed the Way We Buy
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In 2016, millennials assumed the throne as the world’s largest generation by population. Indeed, millennials are now entering their earning prime -- commanding a $1.3 trillion global wallet -- and spending their funds in far different ways than generations before.
Last week, I attended the Millennial 20/20 Summit in New York to hear from investors, corporate executives and startup founders regarding the future of business across consumer verticals.
1. Millennials do not get sold to -- millennials discover.
“You can’t just sell to millennials,” said Michael Lindenbaum, executive vice president of operations and development at the Dream Hotel Group. “You can’t throw marketing dollars and force your agenda on them. No, the process is much more nuanced than that.”
Dream’s success, especially among the millennial populations in Manhattan and Los Angeles, has pushed Lindenbaum and his team to think outward. “Over time, our spaces operate less as traditional hotels and more as community centers: bringing people together throughout the day for work meetings, drinks, panel discussions and celebrations. Our aim is to provide millennials a greater diversity of experiences -- so they are constantly discovering new opportunities at our venues.”
2. Niche brands with powerful narratives are on the rise, but the product narrative is as important as your product’s features.
Duncan Davidson, veteran investor and general partner of Bullpen Capital, has worked with emerging brands across the globe. “The truth is, most big brands do not how to market to millennials. Technology has simply made economics of scale less interesting. This is an ideal time for niche brands to counter-position against them. Young companies can deliver superior value around a niche narrative. They must effectively market the story of their product as much (or more) than they market specific product features.”
Davidson highlights the success of brands such as Naja, whose premium lingerie is crafted by working mothers without husbands in emerging nations such as Venezuela. The mothers receive training and education throughout the production process. Naja’s commitment to the empowerment of women -- coupled with the quality of its product -- has catalyzed the company’s explosive growth globally.
“We are increasingly looking for brands and companies that are taking a position counter to the status quo. Technology has made economies of scale less interesting,” Davidson said.
3. Influencers and customers need to be telling your story -- at the right time.
Last year, Bacardi kicked off its Rising Stars Program, spearheaded by Nim De Swardt, Bacardi’s chief next generation officer. “The initiative is fueled by a culture of agility,” she shares. “The Rising Stars are taking a look at every vertical of our business, uncovering ways where we can better address the cravings of our customers.”
Michael Dolan, Bacardi CEO, emphasizes the importance of creating buzz at the right time and place: “In a post-modern world where information hurls constantly from a hundred different directions, a brand needs to be omnipresent whenever millennials are making decisions. We strive to create events in the places where young folks like to be, we interact with the influencers that they respect and we try to inspire their peers to share our story. In our business, the adoption process occurs largely during one’s 20s -- that’s when consumers develop the repertoire of spirits they enjoy and identify with.”
4. Millennials call for direct and deep relationships with brands.
As chief of Google’s mobile brand strategy, Peter Roper explains, “millennials have thrown a wrench in typical branding practices. Companies need to sharpen their pencils to be communicative in entirely new ways. Advertising used to disseminate from ‘one-to-many’ (think of television ads, for example); the objective today should be to tailor your campaigns to function as ‘one-to-one’ efforts. Millennials demand that kind of attention.”
Katerina Schneider, founder and CEO of Ritual, a vitamin subscription service, is aiming to disrupt the vitamin industry through greater transparency. “Millennials are more accustomed to buying things online. One of the greatest trends I witness every day is the removal of middlemen; rather, the increasing prevalence of direct relationships between consumers and brands. That trend is only going to continue to grow. Communities are being developed online where millennials interact with their products like never before.”
Related: 10 Tips for Millennial Marketing
5. Options are overrated.
“When assessing investment opportunities, we’ve always aimed to look at the team beyond the founder. We’ve always been hyper perceptive of the chemistry between a founder and his or her team” comments Alliott Cole, a director at Octopus Ventures.
“But today, after considering the team, we are increasingly attentive as to whether a company will anticipate consumers’ needs and thus be able to make decisions for them. Millennials live in a world of constant choices; therefore, it is increasingly vital that companies proactively and concisely present solutions to customers -- sometimes to problems they may not even have known they had. Then, you hit the market with one product -- a solution that's directly on point.”
Millennials have changed the rules of commerce.
The takeaways are increasingly clear: The rules of the game have changed. For many entrepreneurs who are taking an individualized approach to evangelizing their product narrative, the future of commerce is presenting opportunities like never before.
Waiting in the wings are bases of consumers who are eager to become product ambassadors. Online startups are directly interacting with consumers who trust virtual communities like no generation before. And, despite the qualms of millennial fickleness, many modern businesses are empowering a workforce that lives and breathes their brands. Forward-thinking companies are creating more individualized and fulfilling next-generation experiences for employees and customers -- online, and across the globe.