The baby boomer generation has changed the pension system and the real estate market in developed countries. Post-war fertility rates generated a high demand for real estate in Europe and the USA, and also forced governments to introduce accumulative levels of pensions.
In turn, the generation of echo boomers or millennials changes the rules for trade and marketing. Young, educated and wealthy children of baby boomers do not trust advertising, preferring the recommendations of friends in social networks. They actively use the Internet to select and purchase goods and services. How exactly do they do it, why is it important for retailers, and how does the millennium generation riot change trade and marketing? Experts at the University of Massachusetts at Darmouth tried to answer these questions in the Millennials stimulate social trade research.
"We are strange, you can recognize us at first sight": who are the millennials
The words of the classic of domestic rock, rendered in the subtitle, refer to generation X - the elder brothers and sisters of the millennials. But they can also be used to describe generation Y: do not young people look strange, having hundreds of virtual friends and feeling lonely in real life?
Millennials are people born between 1980 and 2000. Generation Y grew up in the pre-Soviet era, but today its representatives are very active in using the Internet, desktop computers and mobile gadgets. Millennials are baby boomer children. The surge in fertility after the end of World War II led to the emergence of a large post-war generation. Accordingly, the generation of baby boomer children is also characterized by its multiplicity.
According to the University of Massachusetts at Darmut (UMD), tens of millions of representatives of generation Y are living in the USA alone. By 2015, the aggregate purchasing power of the millennials will be 2.45 trillion US dollars on a global scale. The multiplicity, consistency and active use of network communications are among the factors due to which generation Y greatly influences marketing and trade. To study this effect, the UMD conducted the Millennials Stimulate Social Commerce research.
How huskies and pins turn into sales
Experts at the UMD Market Research Center call social marketing marketing strategies that involve using social networks to buy and sell goods and services online. The term "social commerce" is not limited to the direct ordering and payment for products on the web. This is a communication of sellers and buyers throughout the purchase route.
According to the UMD, millenials are the main driving force behind the development of social commerce. They have excellent computer skills and actively communicate in social networks. Most of the "players" have their own work and opportunities to make purchases online.
Unlike older brothers from generation X, the millennials are weakly influenced by traditional marketing technologies. For example, they almost do not perceive advertising. "Igreki" grew up in a technological era, so they want to decide for themselves how, when and what information to consume. Therefore, to fight for the attention of picky millenials sellers must use the Internet. And the best conditions for interaction between the business and the millennial consumer are provided by social networks.
In 2013, Business Insider and the marketing company Vision Critical conducted their own research on social commerce. Vision Critical experts surveyed 5,900 consumers aged 18 to 55 years. They concluded that the social networks Facebook, Twitter and Pinterest greatly influence online and offline sales. Experts of Business Insider also studied the habits of consumers of different age groups. They found that the lack of knowledge about online technology is one of the most important problems of social trading.
UMD experts interviewed 576 respondents born between 1980 and 2000. 13% of respondents represented the age group from 13 to 17 years old, 38% belonged to the group from 18 to 22 years old, 34% were in the group from 23 to 27 years old, 15% indicated the age from 28 to 33 years old. Most of the respondents are residents of the United States, but residents of other countries participated in the study.
Social networks, millenials and trade
During the study, UMD experts found the following facts:
- Igreki use social networks to interact with brands
62% of respondents are subscribed to news of at least one brand on Facebook. Among the most popular among the users of this network of companies are Nike, Apple, Target, Starbucks and Forever.
23% of generation Y follow brands on Twitter. The most popular companies in this network are Nike, ESPN, Starbucks, as well as NFL and NHL sports leagues. 11% of millennials are following the brands on Pinterest.
Marketing advice: publish content on social networks that your target audience prefers. Try to understand what kind of information your potential customers need when using network resources.
- Why do millennials use social networks?
Echo boomers interact with brands and sellers in social networks to support the companies they like, to receive important information and discounts. More than half of the millennials are looking for brand pages on social networks when they collect information necessary to buy a product or service. "Igreki" trust the seller more if at least one of his friends on the social network is subscribed to his page.
The following table allows you to better understand the millenial motivation in social interaction with brands:
Reasons for Activity / Social Network
Examination of information required for purchase
Studying friends recommendations
The desire to share with friends your preferences
Participation in contests and sweepstakes
Reaction to traditional advertising
Reaction to the recommendation of a friend
The desire to share their own experiences
Marketing advice: publish news on social networks, raffle prizes and discounts, offer users the information they need to make a purchase. The audience is actively seeking relevant data in social networks. People will go to the pages of competitors if they do not find the necessary information in your group.
- 47% of millennials stick a product to Pinterest on their board before buying
This Pinterest feature allows you to manage user intent. It is enough to force a potential client to attach the product to their board in order to significantly increase the likelihood of sale.
Likes and tweets also indicate the user's intention to buy the product. 38% of Facebook users have ever bought a product, after putting a mark like "I like". This figure for Twitter and Pinterest is 33% and 47% respectively.
Marketing advice: Post photos of your products on Pinterest. First of all, we are talking about women's clothing, decor items, DIY goods, since Pinterest remains predominantly female network.
- What products are buying "toys"
Users of social networks most often react to the notes of the category "Means for hair care, cosmetics and clothing." Millennials who prefer Facebook actively buy products in the “Technology and Electronics” category. Twitter users prefer the Food & Drink category, and among Pinterest users, as noted above, DIY, decor, art are in demand.
The following table helps to assess the preferences of the "players" in social networks:
Product Category / Social Network
Food and Drink
Art, design, DIY, photos
Decor and gardening
Hair care products, cosmetics. clothes
Technology and electronics
Marketing advice: choose a social network in accordance with the preferences of the audience. For example, if you are selling women's clothing or cosmetics, post a photo on Pinterest. If you are selling cell phones or tablets, welcome to Facebook.
- Echo boomers buy online and offline
Having seen a product or having received the necessary information in a social network, users make purchases both through Internet channels and offline. Pinterest most effectively generates online conversions, while Twitter users more often than other members of the audience buy offline.
The need to make intermediate steps is the main obstacle for immediate purchases on social networks. The audience does not want to spend time on registration, payment information and other actions.
Marketing advice: use social networks to interact with customers, even if you are trading exclusively offline. If you are selling on the Internet, reduce the number of intermediate steps between the social network and the payment of the order on your site. For example, offer customers authorization on the site using an account in the social network.
- Millennials are actively using mobile gadgets
Generation Y often uses mobile gadgets to consume information on social networks and make purchases. A quarter of respondents always buy products on the Internet using smartphones. The diagram below shows the distribution of answers to the question "What is the proportion of online purchases that you make using smartphones and tablets?"
Marketing advice: make sure that users do not leave your site immediately after the transition from the social network. Use responsive design or mobile version of the resource.
Why it is necessary to reckon with millennialami
Millennials have become the main driving force behind the development of social commerce. Unlike their older brothers and sisters, they are very well versed in modern gadgets and actively use them for social networking and shopping. Unlike younger brothers or their children from generation Z, Millennials have money. Interacting with social networks, sellers and brands create conditions for business development and sales growth.