Don’t let a millennial determine your strategy

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Mark Tamis wrote a hype-busting piece this week entitled “go with the customer flow”. He pointed out that currently only 1% of company / customer interactions take place on social media in France (Les Echos). Yet many businesses are getting caught up with “shiny object symptom”, focusing on the 1% channel and “ignoring the rest of the engagement platform”. Spot on.

Building on Mark’s logic, I’m often concerned by companies who try and re-invent themselves by focusing on or piloting an new initiative with Gen Y / Millennials. These are the digital natives, the logic goes… the ones who have created a connected, always-on world. What better place to pilot our shiny new social engagement strategy?

Time for a reality-check. To be clear, I have no problem at all with Millennials, they represent a vibrant, innovative segment and one that can reap huge rewards if you are able to engage with them successfully and on an ongoing basis. But they are also the most over-targeted segment of our time. It seems that suddenly everyone wants to create Millennial super-fans who blog, tweet, answer support questions in a forum and create viral YouTube videos on the company’s behalf. As a category Millennials are swamped with offers and are notoriously fickle in swarming from one offer / device / network to the next (Groupon coupon anyone???). Their loyalty is extremely difficult to attain and on average their disposable incomes are relatively low, compared to other segments of the market.

Graham Hill pointed me to research from David Demery and Nigel W. Duc on Demographic change in the UK. The research is few years old now but it states that by 2025 the largest age groups (at least in the UK) will be aged 45-65 (27%) followed by those aged 65 and over (20%). In addition, the fastest growing age groups will be aged 65 or over followed by those aged 45-65. The smallest and fastest shrinking age group are those aged up to 30 (only 16%). On that basis the 45s and over are where the growth is and where the money is. As Graham Hill says “it’s time to move beyond the Millenial hype and focus on demographic and monetary reality of an aging, cash-rich and increasingly time-rich population”.

Tom Peters adds another dimension in his book “The Little Big Things”. He points out that the two most powerful markets that most companies ignore are women and boomers/geezers. “The boomer-geezer market is exploding around the world – and is ridiculously under-served: “What an opportunity for the next 25 years – in fact, market opportunity #1”. The sweetest market, he says, is baby boomer women, quoting the brilliant article in the Economist “The importance of sex” which leads with the provocative opening line “Forget China, India and the internet: economic growth is driven by women”.

Moreover, digital is not exclusively the domain of Millennials. In their 2009 research “The Broad Reach of Social Networks”, Forrester state that seventy per cent of online adults aged 55 and older tap social tools at least once a month. People over 34 have become the largest segment using Facebook and much of te growth in social networking usage is being driven by people over 34.

Before you rush to create target personas who live and breath digital, start with the basics of customer strategy by analyzing your total target market, defining your unique customer value proposition and thinking outside-in about how you can help your customers segments create value. Millennials may seem like an attractive starting point but they are not the only game in town and they certainly aren’t the only segment that has embraced digital.

Republished with author's permission from original post.

Laurence Buchanan
Laurence is CEO of EY Seren and leads EY’s global Customer & Growth practice. He works with clients to help them re-imagine growth through human-centered design, innovation and the transformation of Marketing, Sales & Customer Service functions. He is a recognized authority on digital transformation, customer experience and CRM, he has worked across a wide range of sectors, including telco, media, life sciences, retail and sports. He received an MA in Modern History from the University of Oxford.

2 COMMENTS

  1. Interesting read, Laurence; thank you. I agree with you; people of all ages are going digital. I also agree that Baby Boomers have been redefining the world at every stage of their lives; there is every reason to believe that as they age they will continue to be important, influential customers with great purchasing power.

    As you point out, rather than getting caught up in the hype of the "shiny new digital tool,” companies need to focuson on engaging customers in the way that works best for the individual customer. In some cases, that will be via social networks, in other cases it may be via email, text message, voicemail, snail mail, or in-person communications. Not all customers will want to communicate in the same fashion.

    I always recommend finding out how each individual customer prefers to communicate with a company, and then communicate with them accordingly, while ensuring you're sharing relevant and useful information. For example, we're seeing many companies take customer engagement up a notch… they are moving beyond upcoming sales reminders to providing useful information that customers actually want or need in order to better utilize products or services provided by the company.

    The healthcare industry provides a good example. As boomers march into old age, they’re developing health problems. In fact, according to a recent study, "A Fragile Nation in Poor Health,” 56% of American Baby Boomers do not feel their overall personal health is in good shape, and 80% admit they don't follow treatment plans exactly as prescribed.

    To prepare for the onslaught of chronically ill baby boomers, physicians are reinventing the way they interact with patients. They are using ubiquitious technology – such as email, text messages and voicemail – to deliver care between doctor's visits.

    As a patient, you feel like a valued customer when your doctor cares enough to leave you an automated message reminding you to take your medication in the morning with food and water. This approach is customer / patient engagement is working. In fact, 25% — or 30 million boomers — who feel they could better follow their prescribed plans would be likely to do so if they received encouragement from their doctors between visits to stay on course. And, 1 in 10 — or 15.8 million boomers — say they would follow instructions better if they received electronic reminders from their doctors telling them to do something specific, like take medication or check blood sugar levels, according to the study.

    I think we can all learn something from how the healthcare industry is engaging customers in a way that enables them to become an integral part of the patients' daily lives. It's a concept more companies should embrace.

    Thanks,
    Scott Zimmerman, President, http://www.TeleVox.com

  2. Great word of caution. Cool brands want to capture early adopters, trend setters, those who the rest of the market will inevitably follow. Millennials or Gen Y fall into this group. They may not be numerous and may not have high incomes (at the moment) but these are the guys who define what is cool today and tomorrow. There is also a large group of Millennial Wannabes (Gen X mostly?). And a lot of innovation is driven by Gen Y’ers. So unless you are a very traditional brand which relies only/ mostly on people 45+ years, or you are a copycat, you need to know what’s up with Gen Y’ers and you need to work on strategies for this segment. They may not be your largest segment, but they are the one that will define how your products will look like and how they will be consumed (and if you will exist in the marketplace) 5-10 years down the road.

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