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Generation WHAT? Do You Really Know Your Customer And How To Reach Them? | March 22, 2017 (1 comment)
La Costa, CA—For over a decade now, we have been actively referring to different age groups of people as Baby Boomers, Generation X, Y, Millennials and so forth. Many of these terms are not only confusing but actually overlap one another. The purpose of this article is twofold: One, to define as best as possible what each of these groups represents and why it matters to you. Secondly, with this information, what should you do in your advertising and merchandising to reach your customers? This is a big topic that could easily be broken into multiple segments, but we will attempt to make it concise and trigger thought provoking moves in your business.
Defining the groups: Debate remains as to what age group is considered under which title but generally speaking it looks something like this:
- Baby Boomers (Me Generation), born 1946-1964, now 53 – 71 years old
- Gen X, born 1965-1980, now 37 – 52 years old
- Millennials (also, known as Gen Y, Net Generation), born 1981 – early 2004, now 13 – 37 years old
It’s easy to see, even in this simplified chart, that there are multiple names for the same group of individuals. Gen X is often completely overlooked as they only represent 15 years of this entire timespan, and the cohort is significantly smaller in number than either the Boomers or Millennials, but they have some of the highest discretionary income. To give an example of the uncertainty of it all, now take a look at how the media defines Millennials:
- Time magazine says Millennials are born 1980-2000
- Newsweek: born 1977-1994
- New York Times: born 1976-1990 later 1978-1998
It's difficult to define when we can’t even settle in on the time span--and that's not counting the next group of consumers, called Generation Z (also known as Post-Millennials, the iGeneration, Plurals or the Homeland Generation) which, again, demographers start anywhere from the mid 1990s to mid 2000s.
Regardless of the variances, the basic premise of defining these groups and understanding them is important to your business. The majority of independent jewelry store owners in America are Baby Boomers who are either currently or quickly approaching retirement age and will be making big decisions about their businesses. Even if this is not you right now, knowing the buying habits of these generations will help you market to them as well as identify possible segments to sell your business to when the time is right.
Let’s take a more in depth look at the characteristics and buying behaviors of these groups.
Baby Boomers, now 53-71 years old, are also known as the “me” generation. They have experienced radical changes in their social and moral environment over their lifetime: civil rights, the Vietnam war, women’s rights, sexual revolution, Cold War with Russia, and space travel. They were promised the “American Dream” as children. They have worked hard for it, but are considered greedy, materialistic and ambitious (all good things for us in the jewelry business). They believe in equal rights, are considered very optimistic, and are extremely loyal to their children. Their workaholic life style started the 50-hour work week and they tend to lack balance in life, unlike generations that follow.
Boomers crave recognition and are prepared to work for that award that recognizes their performance. They don’t mind spending their money and showing off their purchases as a way of acknowledging their success. Baby Boomers may be the oldest of the generations that we are discussing, and they certainly are impacting the jewelry industry when it comes to ownership of stores, but they also affect your customer base (and for many retailers, still comprise a hefty portion of it). They have discretionary income and with the ‘right reason’ to spend it, they are happy to do so.
Gen X, now 37-52 years old (some demographers expand it to 34 – 54) are in their prime for spending discretionary income. They are mostly settled into their lifestyles, have made most large purchases such as homes, and have funded private school by now if they planned to do so. However, their perceptions have been shaped by growing up having to take care of themselves, watching politicians lie, and their parents get laid off. They came of age when the United States was losing its status as the most powerful and prosperous nation in the world. They are the generation of latchkey kids when women were suddenly expected to work outside the home, and they watched their Boomer parents turn into workaholics. They have a reputation for being ethical, flexible, and focused on results, if a bit skeptical or cynical. They have a high degree of brand loyalty and seek more balance between work and life than Boomers. More impactfully, they are the first generation that will NOT do as well financially as their parents did.
Millennials, now 13-37 years old, are the generation everyone is talking about. It seems the Boomers are mostly annoyed by them and the Gen Xer’s just can’t relate to their buying behavior or lack of loyalty. They are generally referred to as the “entitled generation” or the “trophy generation.” This phenomenon came about from cause and effect: where Gen-X latchkey kids were under protected, Millennials were overprotected and the overall family dynamic revolved around their needs and desires. Millennials’ parents raised them in an environment where everyone was a winner (i.e., everyone got a trophy for something), creating unrealistic optimism. Because you could be a winner just for showing up, the accomplishments of true winners were diminished. And the ones who came in last often felt worse for receiving a medal that they knew they didn’t earn or deserve.
One reported result of Millennial optimism is that they enter into adulthood with unrealistic expectations, which sometimes leads to disillusionment. Many early Millennials went through post-secondary education only to find themselves employed in unrelated fields from their studies or underemployed and job-hopping more frequently than previous generations. This cycle has created low self-esteem as they are faced with the stark reality that EVERYONE IS NOT A WINNER! This generation’s heavy use of social media only contributes to this as they read moment-by-moment details of the wonderful experiences their friends and colleagues are having. They only see the “bring and brag” of others and not any of their failures.
What does this mean for you, the jewelry retailer? You must know and understand the mindsets of all your customers. How can you market your business to these groups if you do not understand what they deem important, what creates trust, if any loyalty exists at all, and how you plan to reach them?
One-stop advertising no longer works. Your customers span many years with longer buying power than ever before. Each of these groups receives their personal input from different sources. Boomers still predominately trust print ads and television; Gen Xers enjoy taking their time researching and they value information. When they find the right fit, they are loyal. Lastly, the Millennials are more technically savvy than any generation we have known before. They rely almost exclusively on what they view online, and through social media rely heavily on third party recommendations in their decision- making. When they watch television, it’s likely to be over the Internet through a streamed service such as Hulu, rather than traditional broadcast TV.
You have three distinctive groups of individuals with different buying habits and different triggers than ever seen before. Your advertising must be creative and inspiring; it must reach into each of these groups independently because one media message won’t touch them all. As you are developing your advertising plan for this upcoming year, we challenge you to stop and reevaluate who you are and who you want to be in the community.
What is your message? Let it define you. Is your plan to be the traditional store who caters to the Boomers and a few Gen Xers? If you are good with that, then you know your direction. On the other hand, do you want to be known as the place to go for engagement ring purchases? If so, how’s your social media program doing?
These are just examples to help you begin the thought process and to acknowledge that your customer has changed. And not just their age, but also their thoughts, their buying choices and their values. This isn’t the 1950s, as we all know, but how you define yourself and your store sends the message to the community that will certainly impact your bottom line. The challenge is sticking with your definition and then getting the word out.
ACTION STEP:
Hold a store meeting and talk about who you are and/or want to be, then as you plan this upcoming year be certain your merchandise mix and advertising matches off with that same statement.
www.Vantage Groupinfo.com, 760-633-2959
Sources:
Simon Sineks, author
Margaret Rouse, Millennials
Generational Differences Chart