I spoke to two very different audiences at conferences last week. One was a global group of leading search consultants, and the second was a large group of retailers. My topic in both cases was “How your clients/you can win over the customers of tomorrow.”
You’ll see my five-part answer to this question in this blog over the next few weeks.
How Millennials (Tomorrow’s Customers) are Different
This is the key starting point. Baby boomers through Gen Yers grew up under a paradigm of prosperity. Each day was expected to be better than the last—in a never-ending ascending staircase. Each day they’d awake with a better paying job, be able to afford a larger home, and provide more for their children. The economy would continue to grow and the stock market rise. They would be better off than their parents’ generation.
Millennials, however, are living in a society of scarcity. They see themselves as standing on the edge of a precipice, staring into a black hole. Good jobs are hard to find—or don’t exist. And there won’t be any gas to drive to work. They can’t afford a house—or perhaps even a condo. The worldwide economy is in the throes of confusion, and while the stock market may go up, it has volatile downward convulsions. The environment is in peril, and species of animals are disappearing.
Scarcity scares. This is having a psychological impact on millennials’ buying decisions.
On top of this, they’re living in a marketing environment that is commoditized and homogenized. Brands and products are undifferentiated. Price is no longer a compelling differentiator. They need another way to make decisions—and they’ve found it.
Combining “Value with Values”
“Value” for earlier generations meant offering a good product or service at an affordable price. Most times lower than their competitive set. This is what led to the high/low model. That won’t be enough anymore. For our new customer, we need to do more than provide the product or service at a low, competitive price. We also need to ensure that the product is of premium quality, that we give them a gift or freebie as added value, and support all this with credible customer service. This combination of price plus provides the new signal of value.
As for “values,” it is extremely important for this customer that companies and brands now stand for more than generating profits. Millennials want to buy from firms that are committed to actions that do good. Firms that focus on sustainability, that do the right thing for their employees and their communities, that stand for helping our world be better today and into the future.
Customers of tomorrow want to align themselves with businesses that share their values. This creates an emotional bond that’s important for moving customers up your ever ascending staircase—taking mindfulness of your brand from “habits,” through “routines,” to your goal of “brand ritual.” (More on that to come.) It’s not enough to make a good product or deliver a good service—you must show that you’re a good company. One that they would love to do business with.
Next week I’ll cover Initiative #2: Put Digital at the Center of Your Programs.