Gucci showed some swag last week by announcing it will be dropping fur from its collection next year. In millennial-speak, the storied Italian luxury brand is being relevant AF and will risk FOMO as the luxury business wakes up to conscious consumerism. But what is even more important is that millennials account for more than half of Gucci’s consumer base, and this demographic is more inclined than any other age group to support and pay more for ethical brands.
Gucci is far from being the only "opaque" brand that has made overtures to millennials through sustainable and ethical business moves. Fast fashion brand H&M, mired in accusations of running sweatshops in South Asia, has recently launched a slightly higher priced new label Arket that names the factory where its clothes are made.
Born to baby boomer parents between 1981 and 1997, millennials grew up in a period of relative economic stability and are commonly considered entitled, connected and distrusting of brands. Yet despite their lack of deep pockets compared to older consumers, millennials (aka 'Gen Y'), who represent 45 percent of the population in Asia Pacific, have held much sway, giving brands plenty of reasons to dive deeper into digital marketing.
In fact, it is not uncommon to find product lines that are released especially for millennials, such as Shiseido’s Waso skincare range, which espouses a minimalist beauty philosophy. Meanwhile, various brands have attempted their own 'millennial makeovers' to market to this attractive demographic by embracing ecommerce, Instagram and Snapchat.
Bonnâe Ogunlade, regional business director at Carat APAC, says millennials are the "must reach" demographic much like the yuppies were in the '90s. "One clear difference about millennials is that they are more multifarious and documented," says Ogunlade, adding that the whole fascination with millennials is fuelled by their nature to share and self-document their lives.
Marketing to millennials is a well-trodden path, and the industry is littered with best and worst practices. Millennials are heavily researched, segmented and categorised by both brands and the media due to their considerable influence and spending power, adds Ogunlade. "Having such a savvy and demanding audience is forcing our industry to re-evaluate and reinvigorate our targeting and marketing strategies. Brands and marketers alike are more accountable, accessible and creative in our offerings."
Nevertheless, Nadia Tuma-Weldon, senior vice-president and director of McCann Truth Central, who is behind the group’s Truth About Age study, fears that the 'millennial' term could be overused and thus repel the very group that the marketers eager to court. “What happens is that when advertisers were taught to understand millennials, it is not because this generation refuses to engage in marketing, or the death of traditional marketing as we know it,” Tuma-Weldon says. “(Instead) the marketers try to label them and come up with so many stereotypes…entitled, and even adulting, that it could create quite a backlash because millennials hate wrong assumptions about them.”
Who are millennials?
Considering that so many labels get thrown around for millennials, what are the stereotypes that stick or do not? For one, millennials are not so daft as to keep splurging on overpriced avocado toast so as to forego any savings to buy property. “The fact of the matter is that millennials can’t afford the mortgage," says Tuma-Weldon. "There’s a real problem in advertising when we are obsessed with certain concepts and boil it down to the smallest denominator and miss the nuances."
While many constructs about millennials here in Asia are imported from the West, Tuma-Weldon agrees that there are several generational qualities that cross continents. For example, there is less stigma attached to living with parents in Asian societies, as young adults typically do not move out of their family homes until they get married. However, since millennials are delaying marriage, they are also living at home longer with more disposable income and freedom to travel. “We just want to be more careful at looking at millennials as a silo. In general, travel is becoming more acceptable to everybody…boutique hotels and Airbnb have (also) become more acceptable to everybody, even though those were initially borne from targeting at millennials,” says Tuma-Weldon.
Another misconception about millennials is that they eschew consumerism and materialism since few are buying houses and cars. “Young people are still buying a lot of clothes," says Tuma-Weldon. "Material items are still important to them. But these things need to be wrapped in experiences. We see brands creating stories around their products. Maker culture is something that appeals to them."
Given that millennials lap up more tweets and posts from influencers, brands have also tapped into user-generated content to reach millennials. "If the synergy is right, then brands should embrace and encourage eager and influential consumers to create, share and amplify content," says Carat's Ogunlade. Such formats have been proven to work especially well for certain sectors, such as travel, food, beauty and entertainment. "Millennials are demanding much more from their travel and it makes sense to give them the chance to explore and document new destinations. How they voice and share it with their peer groups could be what gives their trips their edge. Making this kind of connection with other millennnials will be invaluable," notes Ogunlade.
Post '80s versus Post '90s
In fact, increasing ease of using social media continues to set younger age groups apart from their slightly older peers. The Asean Millennials: One Size Fits All study by the Hakuhodo Institute of Life & Living Asean (Hill Asean) expands on the differences between millennials born in the 1980s and 1990s. One fundamental difference is that the younger cohort are digital natives compared to the 1980s generation, which lived through the dial-up internet age.
As a result, the younger millennials have a less guarded attitude towards their social-media personas, since there is little distinction between their real and virtual lives. The older millennials who only started using social media after coming of age appear to be more careful in curating their posts and are concerned about persona-creating, be it on their social or retail behaviours.
To put it simply, Goro Hokari, director of Hill Asean, says the post-80s millennials are more inclined to show off. The travel destinations and food have to be Instagrammable, while at the same time they also care about value for money. In contrast, the post-90s millennials care more about experience, authencity and what brands stand for. Jing Travel’s What’s Influencing Chinese Millennial Travellers joint-study with Carat shows that the “culturally curious” form the biggest group of travellers among Chinese millennials. Likewise, the #agodabasecamp campaign released last year for Indonesian millennials underscored the idea that travel accommodations are the place to meet people and unexplored local destinations are cool.
“Faced with budget limits, marketers need to narrow down the main target to be either the post-'80s or '90s,” said Hokaro. “Then they can come up with the appropriate approach specifically to each group. Also, they can allocate a smaller budget for the sub-target by using digital marketing, (for instance).”
Linna Zhao, head of insights at MEC China, suggests that the younger Chinese millennials, especially the post-'95s generation, or the Gen Z, are more confident and assured of their beliefs. Unlike the common broadly defined demographic of millennials, Zhao says a generation turns over every 10 years in China due to policy changes and rapid economic development. “Being the first generation from the only-child policy, the post-'80s had a more awkward transition into adulthood, coupled with recessions and fewer jobs around the time they graduated,” says Zhao. “So this generation aspire to social status symbols and are more wiling to spend on luxury items.”
While internet censorship laws in China might provide a different experience for younger generations, Zhao feels they have not curbed the expression and development of Chinese millennials in any way. “The internet space is very robust in China and not many of the millennials believe that they need to use a VPN [virtual private network] to surf for information,” says Zhao. She emphasises that Chinese millennials have grown to develop independent views, an example of which is their penchant for Japanese and Korean brands despite past government standoffs with the two countries and previous calls to boycott Japanses and Korean brands.
Raw versus polished
Meanwhile, the older millennials’ preference for curation can extend to other areas. Tuma-Weldon says they are receptive towards a more polished presentation of brand transparency, while qualifying that millennials are not the only generation that cares about this issue.
“The younger millennials prefer the live-stream element and something more raw," she says. "They are going to be open to anything as long as it is not staged." Citing an example, she says younger millennials may not warm to ethical online clothing retailer Everlane, which makes “radical transparency” its tagline. “Growing up in the world of social media, they (post-'90s millennials) are highly attuned, they are going to sniff out anything staged, manipulative, very quickly.” (Example: Pepsi's ham-fisted hijacking of the Black Lives Matter movement.)
Extrapolating further on brand transparency, Ogunlade says brands need to deliver a value proposition that taps into what matters to millennials, be that community stories, sustainability drives or education programmes. "They (brands) need ot have an authentic voice and a purpose bigger than just selling products to people. They need to inspire and be inspiring," she adds.
The rewards of resonating with millennials
While millennials can be notoriously difficult to market to, Chris Pattinson, senior vice president with Grapeshot APAC, notes that it is not true that they dislike advertising. "They just don't like bad advertising," he says. "Millennials are bombarded by messages all the time. They are also much aware of advertising collecting data and using the same data to target them again. What goes wrong is when advertisers abuse the data when targeting the millennials. That's when you have millennials turning on their ad blockers."
For that reason, Pattinson sounds a note of caution on the judicious use of programmatic on this demographic. Instead, he urges marketers to focus on a contextual approach.
Meanwhile, it can also rewarding for brands to engage with millennials thanks to their openness toward sharing data with brands, as well as their eagerness to share about brands through branded hashtags. “If brands can win their hearts, they will be very open to brands being an enabler of their aspirations,” says Tuma-Weldon. “The Gen X and baby boomers are more sceptical and think that brands want something from them." Yet consumers also want something meaningful in return for their data. "More and more brands are moving away from personalised recommendations and discounts to something that is going to make your life better," she says. "That way, people become less sensitive to the very dark reality of how much brands know about them."
Also, it always helps to understand millennials from their perspective. While millennials are the brand’s targeted audience, they also have their own audience and folllowing on social media. The key is for brands to make their content shareable. “When brands send out some message to their audience (millennials), they must remember to make their audience look cool in front of their own audience.” says Tuma-Weldon.
A lot to think about, but undoubtedly worth the reward.