Welcome!

News Feed Item

The Millennial Generation Is Changing the Face of Consumer Marketing

Study by BCG Shows That Millennials, Who Account for $1.3 Trillion in Direct Annual Spending, Engage More Extensively With Brands Than Do Older Consumers and Expect a Two-Way Marketing Relationship

DALLAS, TX -- (Marketwired) -- 01/15/14 -- The Millennial generation not only represents the consumer market of the future. It is also transforming the way in which companies must market their products both online and offline in order to be successful, according to a report released today by The Boston Consulting Group (BCG).

The report, titled The Reciprocity Principle: How Millennials Are Changing the Face of Marketing Forever, says that U.S. Millennials -- the generation of people now 18 to 34 years old -- engage with brands far more extensively and personally than do older generations, and they expect their values to be reflected in the brands they purchase. Because Millennials are heavy users of social media and mobile devices, the impact of their brand choices and feedback is greatly amplified and accelerated. BCG's global research suggests that the findings about U.S. Millennials and their impact on marketing reflect similar trends among Millennials in other developed countries.

"The conventional linear and rational approach to marketing has been a process in which companies defined their brands and pushed brand and marketing messages at consumers. But this doesn't work well with Millennials," said Christine Barton, a BCG partner and the lead author of the report. "Millennials want and expect a two-way, reciprocal relationship with companies and their brands. As a result, modern marketing has become an ecosystem driven by interactions among marketers, customers, and potential customers, who help define brands and influence their success."

The report is based on findings from surveys in 2013 conducted by BCG's Center for Consumer and Customer Insight involving nearly 4,000 U.S. Millennials and non-Millennials. The surveys covered behavior, values, brand engagement, marketing tactics, and other topics. U.S. Millennials already account for an estimated $1.3 trillion in direct annual spending, of which at least $430 billion is estimated to be discretionary, nonessential spending. These estimates do not include substantial Millennial-influenced spending, such as by parents and grandparents. And this sum will grow dramatically as more Millennials reach peak earning and buying power. By 2030, the projected 78 million Millennials in the U.S. will outnumber the projected 56 million baby boomers (ages 50 to 69).

Millennials are driving a transformation of consumer marketing across five elements: reach, relevance, reputation, relation, and referral. Several findings from the BCG surveys illustrate these points:

  • Reach. Millennials engage much more extensively with brands through social media and mobile devices than do older generations. Fifty-two percent of Millennials surveyed said they use social media to "like" a brand -- compared with 33 percent of boomers surveyed -- while 39 percent post product reviews. Twice as many Millennials as boomers check prices, look up product information, or search for promotions on their mobile devices while in a store.
  • Relevance. The purchasing decisions of U.S. Millennials are influenced by more people -- and different types of people -- than are the choices of older generations. Less than half of Millennials said that they trust expert advisors such as doctors or financial advisors, for example, compared with 61 percent of non-Millennials. Instead, Millennials reported that they are most influenced by family, friends, and strangers. Millennials were also twice as likely as Gen-Xers (ages 35 to 49) to say that they were influenced by celebrities and four times more likely than boomers.
  • Reputation. Millennials identify with brands more personally. Fifty percent of U.S. Millennials ages 18 to 24 and 38 percent of those ages 25 to 34 agreed that brands "say something about who I am, my values, and where I fit in." Forty-eight percent of young Millennials reported that they "try to use brands of companies that are active in supporting social causes."
  • Relation. To cultivate a relationship with Millennials and sustain brand loyalty, companies must establish a dialogue with them individually and in small groups. Nearly twice as many Millennials as boomers cited "availability 24-7" as the most important thing that brands can do to engage them.
  • Referral. Engaging with Millennials is also important because they 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 they are willing to share their brand preferences on social media, for example, compared with 31 percent of baby boomers. More than half also said that people seek them out for their knowledge and opinions of brands, compared with only 35 percent of boomers.

The report advises companies to make marketing to Millennials a strategic priority and master reciprocal marketing. "This is important not only because Millennials represent the market of the future over the medium term in developed economies," said Barton, who is global leader of BCG's consumer sentiment and generational research topics. "It is also critical because Millennials are the vanguard of large-scale changes in marketing behavior and media habits among older consumers and future consumers."

The report suggests several actions companies should take if they haven't done so already. First, they should set clear, measurable goals for marketing to Millennials. Companies must also transform their organizations by breaking down silos that separate different marketing and media functions, building the new capabilities required to compete in a reciprocal ecosystem, and devoting greater investment to more innovative media and tools that can measure short- and long-term returns from marketing.

"The imperative to engage and win over the Millennial generation represents an entirely new set of challenges and tactics for marketers in developed economies," said Lara Koslow, a BCG partner who is global coleader of the firm's marketing topic area. "This generation is ushering in the end of consumer marketing as companies have long known it."

The report advises that companies reach out to Millennials wherever they are with a cross-media, cross-channel, cross-device brand presence. Brands should reinforce their authentic reputations and brand soul with the relevant values, personality traits, and communications. They should relate to Millennials by moving from push communications to two-way, open dialogue. And they should cultivate referrals among Millennial customers and employees.

To arrange an interview with one of the authors, please contact Alexandra Corriveau at +1 212 446 3261 or [email protected].

About The Boston Consulting Group
The Boston Consulting Group (BCG) is a global management consulting firm and the world's leading advisor on business strategy. We partner with clients from the private, public, and not-for-profit sectors in all regions to identify their highest-value opportunities, address their most critical challenges, and transform their enterprises. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustainable competitive advantage, build more capable organizations, and secure lasting results. Founded in 1963, BCG is a private company with 81 offices in 45 countries. For more information, please visit bcg.com.

About bcgperspectives.com
Bcgperspectives.com features the latest thinking from BCG experts as well as from CEOs, academics, and other leaders. It covers issues at the top of senior management's agenda. It also provides unprecedented access to BCG's extensive archive of thought leadership stretching back 50 years to the days of Bruce Henderson, the firm's founder and one of the architects of modern management consulting. All of our content -- including videos, podcasts, commentaries, and reports -- can be accessed by PC, mobile, iPad, Facebook, Twitter and LinkedIn.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Between the mockups and specs produced by analysts, and resulting applications built by developers, there exists a gulf where projects fail, costs spiral, and applications disappoint. Methodologies like Agile attempt to address this with intensified communication, with partial success but many limitations. In his session at 18th Cloud Expo, Charles Kendrick, CTO & Chief Architect at Isomorphic Software, will present a revolutionary model enabled by new technologies. Learn how business and devel...
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data. In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...
The IoT has the potential to create a renaissance of manufacturing in the US and elsewhere. In his session at 18th Cloud Expo, Florent Solt, CTO and chief architect of Netvibes, will discuss how the expected exponential increase in the amount of data that will be processed, transported, stored, and accessed means there will be a huge demand for smart technologies to deliver it. Florent Solt is the CTO and chief architect of Netvibes. Prior to joining Netvibes in 2007, he co-founded Rift Technol...
If there is anything we have learned by now, is that every business paves their own unique path for releasing software- every pipeline, implementation and practices are a bit different, and DevOps comes in all shapes and sizes. Software delivery practices are often comprised of set of several complementing (or even competing) methodologies – such as leveraging Agile, DevOps and even a mix of ITIL, to create the combination that’s most suitable for your organization and that maximize your busines...
Struggling to keep up with increasing application demand? Learn how Platform as a Service (PaaS) can streamline application development processes and make resource management easy.
New Relic, Inc. has announced a set of new features across the New Relic Software Analytics Cloud that offer IT operations teams increased visibility, and the ability to diagnose and resolve performance problems quickly. The new features further IT operations teams’ ability to leverage data and analytics, as well as drive collaboration and a common, shared understanding between teams. Software teams are under pressure to resolve performance issues quickly and improve availability, as the comple...
The proper isolation of resources is essential for multi-tenant environments. The traditional approach to isolate resources is, however, rather heavyweight. In his session at 18th Cloud Expo, Igor Drobiazko, co-founder of elastic.io, will draw upon their own experience with operating a Docker container-based infrastructure on a large scale and present a lightweight solution for resource isolation using microservices. He will also discuss the implementation of microservices in data and applicat...
Join IBM June 8 at 18th Cloud Expo at the Javits Center in New York City, NY, and learn how to innovate like a startup and scale for the enterprise. You need to deliver quality applications faster and cheaper, attract and retain customers with an engaging experience across devices, and seamlessly integrate your enterprise systems. And you can't take 12 months to do it.
See storage differently! Storage performance problems have only gotten worse and harder to solve as applications have become largely virtualized and moved to a cloud-based infrastructure. Storage performance in a virtualized environment is not just about IOPS, it is about how well that potential performance is guaranteed to individual VMs for these apps as the number of VMs keep going up real time. In his session at 18th Cloud Expo, Dhiraj Sehgal, in product and marketing at Tintri, will discu...
Machine Learning helps make complex systems more efficient. By applying advanced Machine Learning techniques such as Cognitive Fingerprinting, wind project operators can utilize these tools to learn from collected data, detect regular patterns, and optimize their own operations. In his session at 18th Cloud Expo, Stuart Gillen, Director of Business Development at SparkCognition, will discuss how research has demonstrated the value of Machine Learning in delivering next generation analytics to im...
This is not a small hotel event. It is also not a big vendor party where politicians and entertainers are more important than real content. This is Cloud Expo, the world's longest-running conference and exhibition focused on Cloud Computing and all that it entails. If you want serious presentations and valuable insight about Cloud Computing for three straight days, then register now for Cloud Expo.
As you respond to increasing requests for new analytics, you need fast and flexible technology in your arsenal so that you can deploy the right workload to the right platform for the need at hand. Do you need self-service and fast time to value? Do you have data and application control and privacy needs, along with strict SLAs to meet? IBM dashDB™ is data warehouse technology powered by in-memory computing and in-database analytics that are designed for fast results, scalability and more.
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
So, you bought into the current machine learning craze and went on to collect millions/billions of records from this promising new data source. Now, what do you do with them? Too often, the abundance of data quickly turns into an abundance of problems. How do you extract that "magic essence" from your data without falling into the common pitfalls? In her session at @ThingsExpo, Natalia Ponomareva, Software Engineer at Google, will provide tips on how to be successful in large scale machine lear...
Up until last year, enterprises that were looking into cloud services usually undertook a long-term pilot with one of the large cloud providers, running test and dev workloads in the cloud. With cloud’s transition to mainstream adoption in 2015, and with enterprises migrating more and more workloads into the cloud and in between public and private environments, the single-provider approach must be revisited. In his session at 18th Cloud Expo, Yoav Mor, multi-cloud solution evangelist at Cloudy...