Marketing to millennials only grows increasingly difficult as their spending trends shift. Tailoring your marketing efforts to what millennials are craving is definitely in your best interest. As of next year, millennials will hold the greatest buying power of any generation.
Where Are They Spending Their Money?
Music festivals, traveling, sporting events, restaurants, Uber rides; is anyone seeing a pattern here? These are all things that millennials are choosing to spend their money on. Today, the millennial population ranges from 18-35 years old with about $1.3 trillion in annual buying power, and by 2018 they will have the most spending power of any generation. Millennials, unlike previous generations, are less often spending their money on items of value, but instead they are buying into the experience economy.
The Experience Economy
More and more millennials are living for experiences; actually 72% of millennials prefer to spend their income on experiences instead of material things. This generation’s appetite for real-life experiences is growing, and companies built on them such as AirBnB, Uber and GoPro are reaping the benefits. The experience economy is no longer a cultural trend, but it is expanding into a widespread way of life. Millennials entered the work force during a recession with a great amount of debt. They aren’t buying cars or homes, but instead they’re prioritizing their spending with what they value most, which is feeling connected through experiences. Millennials are a lot more likely to save money towards a vacation than a mortgage.
How to Access this Buying Power
What we do know is that this generation has a lot of buying power, but how do we access it? The answer to this question can almost always be answered with, ‘social media’. Many millennials will tell you that they made a purchase based on what that they saw online. They saw a celebrity using a product or making memories while on a trip sponsored by a travel agency, and they wanted to have that same experience. 41% of millennials make purchases with their smartphones, and many of those saw the product or service for the first time on a social media platform.
Millennials and Social Media
Social media influencers are selling products by demonstrating what influence the product can have on a millennial’s life. This increases a sense of wanting to experience it personally, along with a fear of missing out (or FOMO, if you will) in millennials. This generation is the most socially connected generation yet and they are driven by what they consume on social media. Most millennials prefer to turn to social platforms to research before even considering buying a product.
What Does this Mean for Marketers?
As a marketer, it’s time to access this desire and need for experience among millennials. If you don’t believe your product will sell to the millennial age group, change up the way they view it. Create a sense of connection between the product and the people surrounding it. Millennials are driven by the idea that they are buying an experience. They no longer want to live someone else’s idea of what life should be like, and that’s why they’re investing their money in ways differently than ever before. So, next time you’re marketing to millennials stop and think, “am I marketing a product, or am I marketing an experience?”