It's Time to Catch Up if You Don't Already Know How to Market to Millennials
By: BCG Perspectives January 17, 2014
Success in marketing to U.S. millennials"”the generation of people now 18 to 34 years old"”will be critical to companies across product and service categories. One reason, of course, is that millennials represent the consumer market of the future.
U.S. millennials already account for an estimated $1.3tr in direct annual spending. This sum will grow dramatically, for only now are the first millennials reaching peak buying power. In the U.S., by 2030, millennials will likely outnumber baby boomers 78 million to 56 million"”and they are forming lifelong shopping preferences and habits now.
It is perhaps more important that this generation is transforming consumer marketing itself. Millennials are distinguished from older generations by their spending habits, brand preferences, values, personalities, and general outlook on life. Furthermore, they engage with brands far more extensively, personally, and emotionally"”and in entirely different ways"”than have other generations.
millennials expect a two-way, mutual relationship with companies and their brands. We call this the reciprocity principle. Through the feedback they express both offline and online, millennials influence the purchases of other customers and potential customers. They also help define the brand itself. The internet, social media, and mobile devices greatly amplify millennials' opinions and accelerate their impact. Companies can expect that a positive brand experience will prompt millennials to take favorable public action on behalf of their brand. A bad"”or even just disappointing"”experience can turn a millennial into a vocal critic who will spread the negative word through social media, reviews, and blogs. And that criticism can go viral.