As the millennial generation begins to overshadow its predecessors in both size and spending power, companies throughout the economy are scrambling to learn how to capitalize on the unique spending habits of such a diverse demography.
However, many experts feel that in catering to the needs of millennials, potential profits are being lost by not establishing relationships with the wealthier, more established baby boomer generation.
While these two groups may be polls apart in their consumption patterns, there still exist few commonalities which can help your enterprise develop multi-tiered targeting strategies to hit common points of interests between the two groups.
Some of these commonalities include:-
Millennials outnumber Baby Boomers: How to adjust your business strategy to draw their attention
According to a census report released in June 2015, roughly a quarter of the American population can be identified as Millennials – youth born between 1982 and 2000. At 83.1 million, Millennials now officially outnumber the Baby Boomer generation by roughly 8 million. Businesses are adjusting their business practices in order to capitalize on the growing influence of this demography while still trying to remain appealing to the Baby Boomer Generation, who is said to control and own 63% of U.S. financial assets.
A focus on technology is the key.
Millennials are the first generation considered to be digital natives. As a generation that has grown up connected, online, and faced with a world of infinite choices in their day to day lives, social media presence and technological innovation are the first points of contact millennials have with many businesses. As consumers, 91% of millennials shop online, while 45% browse shopping websites an hour a day. It follows that online reviews generated by your current customers will be more influential on their shopping habits than any marketing campaign you can envision. Therefore a robust multi-platform social media strategy is a must in order to draw the Millennial’s attention.
Engage their desire to be part of a cause.
It’s important to tell a story and engage Millennial’s affinity for social causes. They want to be part of a movement beyond themselves, and are willing to invest in products and services where they see more than just value, but also a sense of community and exclusivity. An online presence that tells a narrative, engages the user, encourages them to interact, and gives them a chance to contribute to a cause, and is built from well-designed content will be much more attractive and ultimately profitable versus more traditional sales, and advertisements.
Millennials are sensitive to value and are drawn to products and services that are new, exciting, and unique.
Millennials are a generation faced with many financial challenges, such as extensive debt and underemployment. As a result, they are more cost-conscious and careful where they decide to spend their money. They tend to defer large-cost items, such as cars and houses and have very little in the way of brand loyalty. They are willing to sacrifice luxury and image for the cheaper option and are more engaged by the chance of experiencing something unique. When they’re not researching products online or shopping for deals through online retailers, Millennials are eschewing traditional brick-and-mortar shops and big-box department stores in favor of pop-up shops, specialty food markets, small local businesses, and unique decor boutiques.
Rethink your retail strategy around Millennial lifestyles.
Millennials are drawn to areas that offer diversity, cultural outlets, and opportunities to network with others in their generation. Rather than pursue home-ownership, they gravitate towards urban and suburban neighborhoods, and in some cases, co-living arrangements. Retailers and service providers seeking to capitalize on Millennial’s domestic arrangements have begun partnering with retail property owners to bring the feel of small businesses and specialty shops into the communities. In order to draw in business from this demography, these companies must provide Millennials with a sense of community and the feeling of a “third place” – a retail environment that offers an alternative to work and home that allows consumers to meet friends, network, or go online without the chaotic feel of large shopping centers.
But don’t discount the Baby Boomers’ spending power
While chasing the carefully guarded disposable income of Millennials, it would behoove businesses to remain friendly towards Baby Boomers. Even assuming that the projected Millennial Generation annual spending in 2017 and beyond will be roughly $1.8 billion annually, this a paltry amount of disposable income relative to that of the Baby Boomers, who census data from 2013 claims are currently spending upwards of $3.2 trillion annually.
However, despite having such a massive amount of spending power at their fingertips, Baby Boomers are only targeted by 10% of all marketing dollars spent by companies. So while it is important for businesses to reorganize and re-strategize to draw in the millennial demographic, they shouldn’t lose sight of the demographic that is living longer and retains a bulk of the spending power in the U.S. economy. What many companies haven’t realized though is that Baby Boomers are drawn in by many of the same strategies that appeal to Millennials.
Keep the focus on technology, but highlight products designed to improve quality of life.
While technology is a way of life for Millennials, for the Baby Boomer generation, they are going to be drawn to household and health technologies designed to ease and support everyday activities. This can include healthcare technologies and services that allow them to retain an independent lifestyle.
Millennials learnt about the importance of social movements and community from the Baby Boomer generation.
Socially responsible business practices have always been important to the Baby Boomer generation, and as the older generation continues to embrace social media and become more vocal in such outlets, it’s equally important to gear your social media presence towards their needs as well.
Cater to the Baby Boomer’s desire to retain their youthful attitudes.
Like Millennials, the Baby Boomer population craves experiences, travel, and recreation. As the life expectancy continues to increase, so too does the Boomer generation’s desire for products that support and enable an active lifestyle.
Focus on services that engage Millennials’ less mobile lifestyles.
Remaining flexible and finding new business models that appeal to Millennials is a strategy that can similarly help to engage the Baby Boomer population and allow them to maintain their routine and lifestyle. This includes services that allow them to maintain their independence such as senior-friendly transportation services, delivery services, and accessible shopping establishments.
Balance is the key to success
Businesses must embrace that both of these demographics will be active contributors to the economy for years to come. In order to maximize profits, it’s vital that both are given equal attention and focus. Ignoring one in lieu of the other only hurts your business in the long run.