Millennials. Five years ago when the term began to infiltrate PowerPoint slides at retail conferences it usually elicited a glazed-over look akin to that triggered by other (at the time) mumbo-jumbo-esque terms like digital native, mindfulness and quinoa (say keen-wa).
Now everyone from booze maker Diageo to South Korea-based electronics giant Samsung is honing marketing prowess to capture the attention (and spending power) of the mid-teen to mid-30s consumer bloc. They (and when I say they, I mean we) work, interact and shop differently.
And this divergent set of behaviours has effectively reshaped the retail space. Research reports about millennials, and how companies can harness and take advantage of Generation Y’s purchasing power, are like a rash.
They’re everywhere — you will not find a consultancy that hasn’t put one out. Convention and tradition be damned, companies have increasingly been tying their marketing strategies to the generation’s egalitarian values and are spending big to land younger customers.
And they would be wise to do so. Consider that already, in the US, millennials are now the largest living generation. According to Pew Research Center, in April this year there were 75.4m millennials compared to 74.9m baby boomers (people aged 51 to 69). To save myself from getting a barrage of e-mails educating me about putting people in a box (because no-one puts Baby, or millennials, in the corner): each country’s millennials have their own unique traits and that there isn’t a one-size-fits-all approach.
Companies, by now, are well aware of this too. Full stop. When I think of brands that are getting it right with millennials though, athletic-wear players like Nike, Under Armour, Lululemon (of see-through pants fame) and Gap Inc’s Athleta come to mind. Their shares have actually received a nice little fillip on this premise: millennials tend to spend money on experiences rather than clothing but when they do buy apparel, they often veer towards athletic wear. Forget Jane Fonda’s workout videos or 24/7 spandex — this sort of elevation of sportswear into mainstream fashion actually spawned the term athleisure.
I didn’t make that word up, I promise. Now, these companies have also been really clever about fostering a sort of society, if you will, based on the commonality of wellness. Nike does run clubs (I’m sure you’ve seen the clumps of neon people running around Jozi’s northern suburbs), and both Athleta and Lululemon have in-store yoga classes.
Valued at US$18bn, social media platform Snapchat (or Snap Inc since its rebranding last week) is another company that’s winning millennials over.
For the as-yet-uninformed: people post pictures and videos onto the Snapchat app – but unlike on other mobile services, they self-delete after a short time.
CEO Evan Spiegel had this idea (when he was at Stanford — he later dropped out before graduation) of creating a platform of ephemeral or real-life conversations. He’s 26, by the way. A Wall Street Journal article says "snapchatters" upload 1bn "snaps" a day and watch more than 10bn videos. It has close to 15m more users a day than Twitter.
Nirvana for advertisers, huh? Anyway, late last week Snap Inc announced its first foray into consumer electronics with a pair of video-camera-equipped sunglasses called Spectacles. It works like this: you tap a button near the hinge, which allows you to record video of up to 10 seconds using a built-in 115-degree lens. Recordings are then wirelessly transmitted to your smartphone. The sunglasses are $130 a pop and will come in three colours (black and the more-hipster coral and teal).
It basically keeps existing users engaged and gets other users into the fold. Also, it could signal that a Snap Inc IPO may be closer than we think.