Baby Boomers, Gen X, Y, Z, Alpha.
We hear these terms all around, but often we aren’t entirely sure which generation is which, let alone how real people behind these infamous one-letter generations think, behave, and communicate.
Segmenting and targeting your markets by age rather than other demographics such as gender, location, or income is called generational marketing. By understanding their underlying generational motivations, challenges, and habits, you can tailor your corporate strategy, products and content accordingly so it “speaks” to a specific generation.
Every consumer segmentation is an extensive task for the marketing department. On top of many methods and possible sub-groups, COVID has just made segmentation more complicated. It impacted every consumer generation, but with the right knowledge, you can customize your marketing efforts to ensure you’re capturing the attention and hitting the right chord of the generation in focus, whether it’s Baby Boomers, Millennials, Gen Z, or Alpha.
To help you gain relevant knowledge of generational marketing, we’ll describe and analyze four key generations that are active consumers at this point:
We’re continuing the series on generational segmentation with Generation Y or Millennials, individuals born between 1977-1995.
Characteristics: Millennials, or Generation Y, were the first generation to grow up with modern technology. Millennials and baby boomers have a history of opposing viewpoints and misunderstandings. Gen Y is often characterized as “narcissistic and prone to jumping from job to job”—an unfair stereotype considering the vastly different social and economic influences millennials have experienced compared to baby boomers. These experiences have shaped their attitudes on where they choose to spend their money. It’s the largest generation in recent history, so brands must market to a broader audience to build a large customer base. Millennials place importance on authentic brand messaging and seek out brands that support social and environmental causes. This generation relies on user-generated content and the value of word-of-mouth advertising. They prefer brands that offer lower prices rather than price drops from offers and deals.
Digital savviness: Millennials grew up along major technological innovations and had a high expectation for virtual tools to be available at their disposal in everyday life, as well as in the workplace. They are also generally more informed about their purchases than previous generations. They are resourceful, more flexible, and constantly exposed to new ideas because they have access to a more globally connected world. 67% of millennials reportedly prefer shopping online, and 81% of them make at least one purchase online every month.
Financial status: Unlike the generations before, Millennials gain financial freedom and stability later in life. They earn less and have fewer savings than Baby Boomers when they were their age. According to Consumer Culture Report, in 2020, their buying power was estimated at USD 1.4 trillion globally, but Millennials are selective about how and where they spend their money. Generally, they’re open-minded to new ideas and lifestyles, extremely socially engaged, and eager to make the world a better place. It doesn’t come as a surprise that, rather than opting for lower prices, 73% of Millennials are willing to pay more for sustainable products or services or help promote a positive impact on the world.
Most responsive to: Also referred to as “Gen Y,” millennials value authenticity and prefer organic engagement over intrusive or targeted advertising. This consumer generation wants to feel like its values are understood and reciprocated by brands. They’re prioritizing health, wellness, and ethically sourced organic produce.
As we continue our generational marketing series, we’ll discuss other generations in the following weeks.
We’d like to emphasize that, like everything in marketing, it’s all about the context. Each generation is different, and their mindset defines who they are as individuals and consumers. Some groups respond well to technology and innovation. Others prefer their comfort zone with products and services they desire to remain the same. Whatever the strategy, brands should focus on a similar approach. For example, honesty and integrity are essential aspects that consumers from all generations look for from brands. Being straightforward with messaging and offers results in a stronger relationship with the market.
In any case, a generational marketing strategy should not be a company’s sole approach to segmenting an audience. At boobook, we believe in a segmentation approach beyond customers’ age and the associated – somewhat stigmatizing – generational stamp. Additional customer segmentation factors, such as geography, income, interests, behaviours, personal values, attitudes, etc., are crucial to successful persona-based targeting. Marketing to different generations requires thoughtful implementation, so avoid stereotypes and assumptions about certain ages.
Instead, learn who your customers are and develop products and communication strategies that resonate with your audience. Reach out to our team, and we’ll help you!