Unless you compete in a market that specifically targets youth, you probably don't spend a lot of time thinking about the emergence of the so-called Millennial Generation in America today.
And if you don't spend a lot of time thinking about Millennials, it may come as a surprise to you that at 100 million strong they are the single largest generational cohort in American history, dwarfing their predecessors Generation X, and even out-sizing that most famous of all generational behemoths, The Baby Boomers.
"But we don't sell gum or acne cream," you may still be thinking, "so why should we care?"
Consider for a moment the half-century long trajectory that The Boomers have taken from 1960s to the present day. Those bearded idealists of the civil rights movement are the self same retirees now marching with placards in the streets protesting for heath-care reform. It's not hard to see just how many of the tectonic shifts in culture and commerce over the last half fifty years have been powered by the demands of the Boomer generation. From Pepsi's co-opting of Sixties counter-culture, to the casualization of the workplace, there is a wealth of evidence for how closely linked broad changes in the American landscape have been to the Boomers moving through time, like the proverbial egg in the snake.
Millennials are not just a more voluminous generation than Boomers, but better educated, more self-esteemed, more demanding, more technologically savvy, more empowered and wired to win at the game of life. And they are pouring daily by the tens of thousands into the commercial and cultural mainstream.
In short, no matter what business you are in, they are your next generation of consumers.
Whether three years, five, or ten from now, sooner or later the Millennials will be the ones standing in the grocery isle, or in the bank managers office, or in the car dealership evaluating your product or service offering, asking "is this for me, really?" More likely, of course, they won't be standing in any of these places, but doing it on a voice-activated iPad while driving to work in Smart Car Version 3.0, but you get the point.
And if you want a vision of the kind of impact this generation can have on an industry, just look at some of the categories where they have come to play already: music— transformed from a big label album-driven model to something so customizable and just-in-time that it's barely recognizable as the industry it once was; clothing—the fast fashion of a Forever 21 shattering traditional "one merchandise drop per season" models into shards; and of course the social networking "industry," remarkable in so many ways, not least of which is the speed with which a single business entity can go from zero to half a billion consumers.
At MTV, of course, youth is our market.
MTV made a decision at its point of inception to never grow old with the audience but to reinvent periodically for each "generation next." So naturally, we have been one of the companies impacted first and dramatically by the Millennial generation coming of age as entertainment consumers.
Because young people are our viewers and because they are so fast and so fickle (and becoming ever more so), we study them with a deep intensity and intimacy. We strive to understand not just the "what," but also the "why"—their drives (conscious and unconscious), desires, passions, fears, and challenges.
In all of our work with Millennials, we have identified a series of traits that are quite unique to this generation (versus prior generations), and which we believe will have dramatic implications on who they will become as consumers—not just consumers of entertainment, but of cars, homes, refrigerators, and shampoo.
Before describing these principles, it's important to highlight two tectonic forces that move beneath much of what defines the uniqueness of this generation. The first, and perhaps most important, is the recalibration of the nuclear family and, as a consequence, the way this generation was parented.
A century of "parent-centered" nuclear family has steadily been under-going a paradigm shift, and may have just passed the tipping point. The nucleus of the family has been moving towards the child, and Millennials look like the first generation raised in that new nuclear family structure. No longer the hierarchical structure with authoritarian parent "leadership," the new family is flattened to a democracy, with collective (if not kid-driven) decision-making process. Parents are more like best friends, life coaches, or as we at MTV call them "peer-ents."
75% of Millennials in an MTV study agreed that "Parents of people my age would rather support their children than punish them," 58% agreed, "My parents are like a best friend to me."
No longer is it necessary to "rebel against" authoritarian parents to individuate, engage in acts of self-expression, or push at the boundaries. As one youth psychologist we work with pointed out, "Parents don't say you can't go to the party, they create safe spaces to consume alcohol, they say Can I pick you up afterwards?, Here's money for a taxi."
Self-expression, having your voice heard, following your own path—these are all values that are positively encouraged in modern parenting styles. Why rebel when you simply need to explain your behavior in terms of "my experiment in self discovery."
Percentage of Millennials who agree with the following statements
(from MTV Millennial Edge Study, 2010):
• I'm always expressing myself in different ways - 81%
• I hate it when other people expect me to live by their rules - 76%
• If I want something, nothing is going to stop me - 69%
In short, the power dynamics of the family have shifted dramatically, and much of the empowered, one could even say "super-powered" style of the Millennials has its roots in this redistribution.
And in the style of pouring gasoline on a fire, the second tectonic shift is technology. The "You Demand It," push button, everything free, always on culture of technology and the Internet has amplified much of the "social coding" of the way Millennials were parented. And as many commentators have already pointed out, the revolution will be tweeted. The power is in the hands of a million anonymous hands, and can be wielded apparently consequence free, in real time, with the click of a mouse.
Based on what we know about what makes this generation tick, and what we hear and observe about them on a daily basis, we have distilled down five principles, or perhaps they would be better described as challenges for businesses thinking about what it will mean to cater to this Millennial consumer as they come on line in a major way to more and more sectors of business.
1. What will it mean when co-creation with your consumer becomes part of your business model?
A generation raised on "children should be seen and heard" simply will not be a passive consumer of anything. They will demand a voice in, a stake in, even a creative point of view about, everything that your business does—from the product itself to the way it is sold and marketed, to the social responsibility policies of the organization itself. They may or may not choose to use that power (for example only miniscule percentages of people actually contribute to the crowd-sourced IP of Wikipedia), but they will demand that the mechanisms are in place that give them the choice to participate and the feeling that co-creativity drives the development process.
And this probably won't be a one-time event ("lets go and do some creative focus groups and get our audience to help us think about innovation"). It will be an on-going real time feedback loop with demonstrable impact and validation built in. One of the most buzzed about ad campaigns of the last few years is Old Spice, where real time changes happen in the commercial creative as a result of input from the audience. There's the beauty of the idea itself, and then there's the power of the feedback/validation loop created with the audience—"See, you matter, your vote counts, your impact is felt and something moves as a consequence, you are smart and creative and you have ... power." And speaking of smarter ...
2. What will it mean to make your product ten times smarter than it is today?
In all the research we conduct with this generation at MTV, the word we perhaps hear the most is "smart" (closely followed by "random," "awkward," "awesome," and "love"). "Smart" means a multitude of things to the generation, but one thing that's common is that it carries a very high premium and social currency. For the most educated generation in history, told by so-called "velcro" parents that smart is everything, it should hardly be a surprise. And indeed 57% of the generation consider themselves smarter than their parents, and 68% agree that "Nerds are the new jocks"!
We already have the Smartphone, the Smart Car and even Smart Water. What is smart soap, smart diapers, smart gas stations.
When you investigate the concepts of smartness further with the generation, some of the nuances that emerge give fascinating insights into their collective psyche. For something to be "smart" it has to, for example, entertain me, remember what I do and anticipate my needs, do "everything" for me, have built-in complexity and layers of meaning, shape-shift, be as smart as me!
3. What will it mean to be in a "two player game" with your consumer?
Millennials have a natural predisposition to view situations in terms of the metaphor of a game. Take the workplace—"what are the rules of this world, what are the levels, how do I get to the 10th one as quickly as possible (that nice CEO suite on the corner of the top floor), is there a shortcut, a smart bomb, a secret entrance, a magic potion?" Foursquare, the location-based social networking site, literally turns one's social life into a game complete with badges, medals, trophies, and even mayor-hood awarded to "players."
The generation learned young and learned well how to expertly negotiate with their parents to get a pass out of homework or a day off school ... power-players in the game called "family." Raised on a diet of almost millions of hours of World Of Warcraft, elaborate world kid-centered "constructs" like Harry Potter, and soccer trophies for the whole team, Millennials want to win.
Asked about "worldview" based on the following phrases, the intergeneration differences here become quickly apparent.
"Game" the system:
Millennials - 53%
Boomers - 26%
Protest the system:
Millennials - 13%
Boomers - 59%
Marketing to this generation may be more like a two player game, where everyone's looking for the win win. How will your campaigns create a sense of "play" on the part of the audience, a sense of depth and levels, a sense of engagement, a validation loop, and ultimately a sense of material and emotional victory (or even of being the special one that figured out how to game it )? In the marketing campaign for Halo 3, level after level of depth was buried within layers of the marketing campaign, consumers freeze-framing DVR playback of commercials to pick up codes embedded in the film to follow breadcrumbs down Internet wormholes for the next clue.
4. What will it mean to your business to operate in on-going versions rather than a final product?
If we had to identify someone who is the face of the Generation, the way that Bob Dylan perhaps was for the Boomers or Kurt Cobaine for Xers, then today that face would be Lady Gaga's. Considered beyond doubt the "most interesting person today" by the generation the core characteristic of Gaga is the speed and ferocity of her self-reinvention. She is doing in 10 minutes what it too Madonna ten years to achieve.
Who do you think is the most interesting person in pop culture today?
Size of word indicates volume of response:
The parental premium placed on self expression for today's kids, combined with technology tools to literally "curate the self" in real time, has created an insatiable appetite for newness. If something does not version, it quickly becomes boring. This has always, of course, been the consumer need that drives every company's innovations engine, but the requisite rpm of that engine is rapidly going into the red zone as this generation come on line as buyers. It's no longer acceptable, for example, that chewing gum remain the same flavor throughout the duration of the chew. No, the gum has to flavor-shift mid chew lest the chewer's dopamine/adrenaline cycles start to fade and new stimulus is required.
5. What will it mean when there is no such thing as an un-connected product?
Everything we are learning about the generation points to a need to be constantly connected, existentially uncomfortable with the feeling of being "alone," experiencing a fear of missing out when they stray to the hinterlands of their social graph. One interesting piece of research led us to understand how the automobile, so squarely a symbol of freedom and independence for prior generations, has become in danger of being perceived as a "disconnection device" for Millennials. "Trapped" inside the hermetically sealed vehicle, "alone", and of course unable to text and check your status update, the feeling of the open road becomes the very antithesis of freedom, more like isolation.
A product which is 'un-connected' has a certain inertness for the generation. At the more superficial level even the most inert product can build a web site and "connect". But it is much more challenging to re-imagine your product experience by asking how to increase its innate connectedness. What would a connected retail experience look like? Perhaps like the so called "haul video" syndrome where kids film themselves in changing rooms trying out different outfits, post the film of their ensembles in real time, and seek feedback from their social network on which ones look best before purchasing.
As the old hockey adages goes, you don't skate to where the puck is, you skate to where it's headed. And in the case of the Millennials, we're looking at a hundred million pucks moving towards open ice where bold, as-yet-unimagined products and services will some day await them. So heads-up, here come the Millennials.
Nick Shore is Senior Vice President of Strategic Consumer Insights and Research at MTV. He is responsible for all of MTV's research efforts across MTV, MTV2, mtv.com, mtvU, and MTV Tr3s platforms.