Millennials will soon make up the largest proportion of the workforce. However, research by experience management company Qualtrics and Accel has found this group of potential customers, aged in their 30s and under, may be the most misunderstood generation. To target this lucrative market segment, business leaders must understand millennials, specifically their different set of requirements for evaluating purchases.
In a global research study, Qualtrics and Accel surveyed more than 8,000 millennials, gen Xers, and baby boomers to find out how millennials are changing, as well as the similarities and differences between them and previous generations. The survey included respondents from Australia, the UK and the US.
The participating millennials said they are prepared to spend more on material possessions if they are of quality and socially sought-after. This creates a significant business opportunity for organisations that can develop products that fit the bill.
Millennials are attracted to products that are socially desirable: this means businesses must get their marketing and communications right if they are to successfully target this demographic. Creating strong engagement with millennial customers is crucial to this endeavour.
Businesses must understand millennials to market to them effectively and, therefore, may need to re-examine their strategies to meet the changing demands of this market. For example, knowing that a quality product or experience is more important to millennials than price should encourage businesses to focus on creating value in the experiences they provide rather than cost-cutting.
Millennials in the workforce
The research also found that millennials measure their work output by achievement rather than hours logged and most value job stability at work. The majority (84%) of Australian millennials prefer to have one full-time job instead of several part-time jobs, while almost half (48%) expect to change jobs in the next 12 to 18 months. A further 68% of millennials are worried about their long-term job prospects, with 70% concerned about having the right skills to succeed in the future.
Businesses looking for ways to attract and retain millennial workers (who will soon make up the highest proportion of the workforce) can do so by addressing these concerns. Providing training and a clear career path, along with mentoring and other learning opportunities, can be a strong way to cement the loyalty of millennials in the workforce.
For millennials looking to change jobs, the main motivation is to make more money. However, the same survey found that 55% of millennials would accept a salary of $53,500 for a job they enjoyed in preference to a salary of $132,500 for a role they disliked.
Making authentic connections
Millennials may be inclined to take their business elsewhere if organisations do not deliver products and experiences, whether online or instore, that meet their expectations. As one of the largest groups of consumers, it is essential for companies to not only understand but also frequently check in with millennials to gauge their experience, including asking for and acting on feedback. This should occur across all feedback channels including mobile, web, instore and all social media platforms.
Millennials expect that businesses will gather this information about them. In the age of Big Data, most people, millennials included, accept that businesses can track their behaviour and interactions, building a profile that lets the business target each person more effectively. In return, they expect businesses to offer an individualised experience that meets their preferences in terms of how and when to interact, the quality and timeliness of those interactions, and the discounts or other offers the business provides.
Businesses that fail to energetically and authentically connect with millennial customers will find it difficult to gain cut-through with this discerning demographic. On the flip side, a business that gains strong traction with millennial influencers can dramatically increase its brand value, and drive strong growth and profits.
Understanding millennial customers
This creates a significant incentive for businesses to understand this elusive group of consumers. That goal is made more complex given that millennials are all different, they don’t have the same desires, needs, preferences, or even disposable income. This means there is no one-size-fits-all approach to building relationships with them. Instead, companies must interact with them directly to elicit their opinions.
This can take the form of pulse surveys or more detailed questionnaires. Businesses may look to track millennials’ movements on their website and ask pertinent questions at key moments. Doing all these things will help the business build a clear picture of the millennials who are potentially interested in what they have to sell. The business can then target them as individuals, which is the approach most likely to succeed.
Simply treating millennials as an amorphous group of likeminded consumers will make it more likely that businesses will fail to gain their loyalty. Understanding them as individuals and treating them as such will make it possible for businesses to secure their share of this lucrative market segment.