Millennials are now the largest age group but retailers and advertisers in general haven’t quite figured out how to reach them.
Millennials are not as interested in drills, machine shop workbenches, gardening, and any number of do-it-yourself items as their boomer parents.
Why should they be? Home ownership is far lower and their boomer parents did not have mountains of student debt. So what’s an advertiser to do?
The Wall Street Journal reports America’s Retailers Have a New Target Customer: The 26-Year-Old Millennial.
The Scotts Miracle-Gro Co. has started offering gardening lessons for young homeowners that cover basic tips—really, really basic—like making sure sunlight can reach plants.
“These are simple things we wouldn’t have really thought to do or needed to do 15 to 20 years ago,” says Jim King, senior vice president of corporate affairs for Scotts. “But this is a group who may not have grown up putting their hands in the dirt growing their vegetable garden in mom and dad’s backyard.”
The biggest single age cohort today in the U.S. is 26-year-olds, who number 4.8 million, according to Torsten Slok, chief international economist for Deutsche Bank . People 25, 27 and 24 follow close behind, in that order. Many are on the verge of life-defining moments such as choosing a career, buying a house and having children.
Companies looking to grab a piece of that business, however, have run into a problem. This generation, with its over-scheduled childhoods, tech-dependent lifestyles and delayed adulthood, is radically different from previous ones. They’re so different, in fact, that companies are developing new products, overhauling marketing and launching educational programs—all with the goal of luring the archetypal 26-year-old.
“They’re much more of a ‘Do-It-for-Me’ type of customer than a ‘Do-It-Yourself’ customer,” says Joe McFarland, executive vice president of J.C. Penney stores. “You don’t need a ladder or a power drill, you don’t even have to wonder if you measured your window right.”
In June the company [Home Depot] introduced a series of online workshops, including videos on how to use a tape measure and how to hide cords, that were so basic some executives worried they were condescending. “You have to start somewhere,” said Ted Decker, Home Depot executive vice president of merchandising.
Ready to Spend?
I question the general thesis that millennials have money to spend.
In fact, millennials have delayed marriage, home buying, and household formation precisely because they do not have money to spend.
Far too many millennials are mired in student debt and living with their parents out of necessity. Others feel an obligation to take care of aging parents.
Deflationary Setup
Factor in dramatically different lifestyle preferences with greater importance on mobility rather than ownership, and it should be clear the setup is extremely deflationary, especially with anemic wage growth that does not keep up with inflation.
Mike “Mish” Shedlock
Cheap air travel should sell. Kids needing to move repeatedly for gig jobs and to visit family.
Anecdotally noticed a moved to more purchases for inexpensive individual wants. Can’t afford a starter home so smaller purchases on things closer to the individual like better/more shoes, clothes etc. Even that needs to be priced carefully.
It does appear deflationary with the consumer engine running on empty if it depends on 20-30 somethings.
A life filled with rentier payments for monthly services and no capital appreciation?
An entire generational cohort like that? (with the exception of the Trust Fund brigade)
Think they’re going to be buying houses?
Think they’re going to be buying stocks?
Think they’re going to be buying bonds?
Think they’re going to be buying cars?
Think they’re going to be buying tools?
Think they’re going to be buying farms?
Think they’re going to be buying business assets or buildings?
Think they’re going to be buying gold/silver?
Or will they spend money on short term non-ownership items, especially when they cannot afford anything else?
When they’ve been raised without physical skills, independence, or given a vision or strategy to live?
Saying “You can do anything!” is like breaking a young birds wings and pushing it out of the next.
Teaching “You should be X or Y, and NEVER Z” and “This is how your life plan should look”
will result in people who don’t fit the above pattern.
Millennials are able to grow plants on their phones in an app. They don’t need to get their hands dirty.
My Millenial son in law is starting to grow potted plants in the courtyard of his apartment house.
Yes he didn’t really know that plants needed sun.
Using a tape measure, plants need sun, etc… Alex, what are things we learned in 3rd grade?
In the movie Idiocracy, people don’t understand plants need water. We’ve de-evolved about 5000 years.
This tells me schools have become so bad, home schooling is the only option. Employers must be tearing their hair out looking for the one kid that can tell time and show up for work. No wonder immigrants are doing better than natives.
My millennial children (two boy/one girl) ages 24 – 28 are all married, out of college debt and now homeowners. They are also will try to do a lot of their own maintenance and upkeep themselves and are willing to learn when they don’t know.
Here in flyover country there are many millenials who are similar to my children and just as techy as the urban millenials.
This millennials are tech savvy narrative is driving me nuts. As a data scientist that has increasingly worked hands on with technology over the last decade, the millennials I’ve encountered are technology addicted, whether it’s their cell phones or video games, but, just like the person above mentioned they didn’t know plants needed sun, they also know very little on the whole about technology. Staring at your smart phone and posting selfies on Instagram doesn’t make anyone a technologist!
+100000000000000
A generation of narcissistic selfie posters, who spent $80K per year in college studying safe spaces and gender neutral pronouns — but they never learned simple math.
Its mind boggling how many US citizens can’t even balance a checkbook, but they know how to smack the “Like” button like a lab rat. Anyone check the annual salary of a lab rat? No one wastes time marketing to lab rats.
Couldn’t agree more. I actually think GenX is the sweet spot of technology know-how as you needed at least a little understanding of the programming and technology involved to use it in the 90s and early 00s. Now everything is a dumbed down GUI where you don’t need to understand the machinations happening behind it.
Few of them understand cryptocurrencies, but most are for it. OTOH, very few old pharts understand the fiat financial system, but still use money.
The macro-economics are clear. Baby boomers are spending less in retirement, and millennials are up to their eyeballs in debt to purchase big ticket items and accessories. That leaves Gen-X to keep the economy going, which isn’t likely to happen. It’s only a matter of time until the majority of businesses report slowing sales and then losses.
The financialization of everything. Millennial’s won’t own cars they’ll pay for Uber rides. Millennial’s won’t learn to cook they will order it through Grub Hub. Millennial’s won’t buy homes, they will of course rent . Millennial’s won’t ownmovies, They Netflix. And, on & on. It’s the no-equity lifestyle. Travel light. Unfortunately, I think this mindset is more likely to embrace single payer healthcare & government retirement schemes. Traditional advertising is probably just another dying relict.
Yes, single payer healthcare. We will be the last developed country to have a universal health care system.
The alt-right loves single-payer. Of course, they want it only for white people..
https://www.vox.com/policy-and-politics/2017/4/4/15164598/alt-right-single-payer-health-care-trump
you lose when you cite vox for anything other than humor.
How about this?
http://nypost.com/2017/03/30/why-trump-should-embrace-single-payer-health-care/
A generation that is too stupid to operate a tape measure also can’t grasp that 30 >3 … Oh, whoops, you probably skipped math class in favor of gender normative studies. Those symbols mean that 30 is greater than 3… as in 30% annual cost increases are much bigger than 3% GDP growth. If only you could grasp a tape measure I could show you where 3 is and where 30 is… alas, you lack the basic educational skills.
My houseplant understands it needs sunlight, and it probably has a better grasp of tape measures than the millenials that think “free healthcare” isn’t a contradiction of terms.
If you can’t grasp sunlight and tape measures, its no surprise you also don’t understand that medical school isn’t free. Even your so-called professors seem not to connect the dots on that one.
OT –
“The future is coming. Arguably it is already here.
Arguably it is already here. Several states have already laid the groundwork for a future with fewer truckers.
Last year, Otto, a self-driving truck company owned by Uber, successfully delivered 45,000 cans of Budweiser in a truck that drove the 130-odd miles from Fort Collins, Colorado, to Colorado Springs. A semi-automated platoon of trucks crossed Europe last year in an experiment coordinated by DAF, Daimler, Iveco, MAN, Scania and Volvo.”
https://www.theguardian.com/technology/2017/oct/10/american-trucker-automation-jobs
https://youtu.be/Qb0Kzb3haK8
Unfortunately, the hard part isn’t the driving. It’s the unloading and stocking.
Unloading (and loading) and stocking isn’t that difficult either. The automated warehouse is coming. (A lot of the technology already exists at a decent ROI.) The biggest impediments to a more automated warehouse now is older management/executives who don’t trust the technology (and it is a higher start up cost) and the capital investments already made in existing sites. Basically any change over is a new implementation with all the complexities that comes with it.
The easiest thing to automate would be airplanes; there are no pesky obstacles, gps could land it, and the plane is mostly on auto-pilot. Yet, we have pilots.
Mish’s article begs the question, what happened in the 1990’s to account for a population surge? … “Immigration, mainly from Asia, the Caribbean and South America, accounted for at least one-third of the population increase, Long said, and increased longevity much of the rest. The impact of immigration, because it includes undocumented illegal immigrants, is hard to measure, experts said.”
http://www.sptimes.com/News/040301/Census/US_underwent_a_popula.shtml
LEGAL immigration, especially of skilled workers, is a huge benefit to the US (or any country). We need skilled workers
ILLEGAL immigration, which generally entails people who would not be allowed in on their own merits, is the problem. We don’t need welfare recipients.
The sad thing is there are a lot of very hard working Mexicans (and other Latin American countries) who are being denied entry by an antiquated and often corrupt immigration bureaucracy…. meanwhile the deadbeats and welfare cases are helped into the country to buy votes.
But if the native children can’t even operate a tape measure….
We can operate tape measures and, speaking for myself, I know how to repair cars, grow all kinds of shit (remember us millenials love growing weed). The problem is we can’t afford a house or really anything when wages can’t keep up with prices
Antifa and BLM is quite effective, look there for your model.
Mellenials will be fine. They are going to inherit a vast level of wealth from their parents. The entire American housing stock. They are going to get all the jobs their parents and grandparents are going to retire from.
“They are going to get all the jobs their parents and grandparents are going to retire from.”
Except those that robotics and AI take over.
I think it is the Xers who are going to inherit whatever is left of all the paper wealth after healthcare costs and bursting bubbles devour most of it.
Technically, the millennials will inherit more of the Boomers’ stuff than Xers. Xers are, extremely imprecisely, supposed to be the children of those born prior to the boomers, which were a smaller cohort. Xers have already received a good chunk of their inheritance.
Traditionally, each generation inherits the one prior, but because of the sudden shift towards delayed child bearing and longer active careers amongst the big post war boomer generation, we ended up with sort of a demographic suckout, which is the heart of the X generation.
Possibly helping explain their stereotypical jadedness and reflexive opposition to everything. As they have lived, live, and will live their lives, in a world built predominantly built for others. “The first whites to experience going through life as a minority,” as someone put it. As they first played second fiddle to the massive boomer generation. Who are then passing the baton straight to the similarly large millennial generation. In the process bypassing the less numerous, hence less visible Xers.
@Jon Sellers — “They are going to inherit a vast level of wealth from their parents.”
Boy, ignorance is bliss.
Typical CNBC level “analysis” if we can call it analysis. First, millennials will inherit whatever wealth is still around after their parents spend it on retirement — not what is currently in their parents bank accounts.
More importantly, and the reason your analysis deserves ridicule — the millenials will also inherit the largest debts in human history. Depending on legal structures and family LLCs — maybe they inherit the debt literally. Or maybe they get hit with the default if the parent’s debt is wiped out in estate court (the wealth is in bonds backed by said debt).
Millenials will definitely inherit the $20 trillion national debt from Obama’s spending spree, plus the $120 trillion in unfunded social security liabilities for their parents “retirement”.
You like to talk about their asset inheritance, but you don’t seem to grasp they will inherit at least as much debt.
Only the net amount matters, and baby boomer’s NET assets (after subtracting liabilities) isn’t very much at all. What is there is likely to be wiped out by the baby boomer’s retirement spending.
Let’s not pretend that the national debt is from “Obama’s spending spree.” Republican presidents, senators, and representatives are equally culpable. The only difference is on where they like to spend the money. (Though Bush 2 did drop a penny or two on healthcare vs the usual MO of dumping it all on the military contractors.)
Lets admit that is was Obama’s spending spree.
Let’s admit Obama’s foreign policy failures essentially handed the middle east to Putin, while sending enough illegal immigrants into Europe to kill off the EU earlier than it was killing itself.
And let’s admit that either Obamacare has to be repealed as the unaffordable welfare system that it is, or let’s admit that baby boomers must be executed by age 67 to avoid their health costs. Either the baby boomers go, or Obamacare goes… and it doesn’t matter what your political opinion is.
An economy growing 2-3% yoy is not going to fund a give-a-way welfare system growing 30% per year.
And if your math skills are so deficient that you think 30 < 3, than you are too stupid to vote.
Lets also admit that it was LBJ’s irresponsible spending sprees (plural) that forced the end of the Bretton-Woods system — Nixon had his own set of serious problems, but LBJ wrecked the country’s balance sheet. The war on poverty plus Vietnam plus the most expensive way to put a man on the moon (without any follow up plan) — the dye for the US to default was cast before the 1968 campaigning had started.
Same with that a$$hat Obama. Blame Bush for a pointless war in Iraq. Blame him for pushing home ownership rates to unsustainable levels. Blame him for having the IQ of a soft boiled egg.
But please stop this moronic nonsense of claiming Obama was even a moderately bad president. Obama was an epic disaster — so bad in fact that a real estate tycoon with weird hair succeeded him.
And while the presidents up through Bush II all paid lip service to balancing spending (you are right that some of them meant it more than others) — Obama is a Chicago hood rat who spent like their was no tomorrow, all the while attacking businesses (and JOBS) while bowing to every foreign leader he could find.
Obama was an unmitigated disaster. He was so bad that the country voted Trump into office.
To the 1% of them whose parents are in the 1%, those debts are assets…….. The process of the generational transfer, will result in putting into starker relieff just how much of the total wealth has been transferred to those guys (both parents and children) as a result of the financialization robbery post Nixon’s full retard moment.
Many who consider themselves middle to professional class, still cling to the notion that they too have benefited from the rackets, as their “home has gone up, and their ‘portfolio’ too” Something the more accurate mark to market of both asset values, private debt and publicly promised entitlements prompted by a de jure transfer, will go some ways towards clearing up for them…..
Nixon happened to be “in the seat” when the US defaulted on Bretton Woods, but if you are even a tiny bit honest, you would admit that LBJ’s ridiculous spending spree made the default a fait accompli.
Kennedy sent the first troops into Vietnam, but LBJ ramped the thing up into a full blown catastrophe. Nixon (despite plenty of other problems) was the guy that ended Vietnam.
LBJ started the war on poverty — there are more people below the poverty line than when LBJ started. LBJ started the war on illegal drugs (before it was called that) — also an expensive and epic failure. And it was LBJ that finished putting a man on the moon in the most expensive way possible — without any sort of a follow up plan (no one has bothered to go since). LBJ was the idiot that expanded Medicare and created medicaid.
LBJ was the guy who committed accounting fraud — supposedly “privatizing” FNMA and FHLMC while keeping the downside risk on taxpayers.
Nixon might have been sitting in the Oval Office, but LBJ’s spending spree ended Bretton Woods.
Blame Nixon for his paranoia. Blame him for covering up Watergate. But stop pretending like Bretton Woods was still viable the day LBJ left office.
Exactly which worthless hack to blame is pretty darned irrelevant.
It was a similar situation to what led to the forming of the Fed in the first place: The leeching scumbags had boxed themselves in with unsustainability within the current rules constraining them. So, instead of doing the right thing and letting their entire unsustainable cardhouse blow sky high and fall apart as they should have, they changed the rules. Bailing out their own idiocies, at the cost of everyone else, then and after. Safe in the knowledge that their idiot underlings would fall for the same old “otherwise the syyyystem will collaaaaapse” nonsense that has worked so well on them. Every.Single.Time.It’s.Been.Tried.
The 2008/2009 bank bailout was yet another example of the same. And we’ll continue to see more of them. In an ever escalating fashion. As long as the idiots keep falling for the scam that “The Syyyystem” is something worth preserving. Instead of something that they should cheer for to collapse. As quickly, completely and irreversibly as possible.
As all “The Syyyystem” is, is a simple theft racket. Serving no other purpose than to facilitate robbing productive people for the benefit of a clique of well connected less-then-nothings, whose very continued existence is nothing but a pimple and a plague on all of history and humanity. The more “the system” reverts to exactly, literally, how it was prior to the start of the progressive era, the better. Including the Dow Jones index, gold to dollar exchange rates, taxes, gun laws, drug laws, all laws….. every single darned thing.
Pingback: Can Millennials Grow Up Before They Grow Old? | al fin next level
Did everyone miss, in the charts above, that the largest group of homebuyers in 2016 was Millennials?
They’re in the age group that buy houses. Same reason Boomers are the largest buyers of caskets.
The poor always pay more. Millennials are a marketers dream.
Sign them up for more trickle-down economics. They will pay more and more for shoddier and shoddier imported stuff. Of course, the jobs to make that stuff have already been exported and/or automated. So they will have to keep borrowing to keep the trickle-down capitalism going. The game is up when they realize at some point that they have been trickled upon all over instead.
“Millennials are now the largest age group but retailers and advertisers in general haven’t quite figured out how to reach them.”
…
With offers of Credit, of course.
Not too long ago read how companies are offering finance so (dead broke) millennials can “afford” to purchase high end juicers and high thread count sheets.
Speaking of time travel … this reminds me so much of 2006. Back then did not know how the wheels didn’t fall off at the time. Later all the gory details of no doc loans / NINJA loans and such came out. At the end of the business cycle credit terms get real loose. Ensuring that the “expansion” continues a bit more, but also ensuring the resulting bust that much worse.
If the US had taken its medicine in 2005 or 2006, the following recession would have not been nearly so bad.
“Factor in dramatically different lifestyle preferences with greater importance on mobility rather than ownership, and it should be clear the setup is extremely deflationary, especially with anemic wage growth that does not keep up with inflation.”
…
Well, you just proved time travel.
What year did you visit?
I imagine he visited a year in which all property “ownership” is heavily taxed to fund government pension obligations.
That was how Venezuela worked. Taxed themselves out of business. Then the following year they wanted to tax everything again for the next year’s pension — and there was nothing there to tax.
Hawking the family silver at fire sale prices to fund one trip to McDonalds is not deflationary.
its selling the future to pay for the present — and its a fast track to poverty. Ask Detroit if you don’t want to fly all the way to Venezuela.
Government pensions are not going to be paid. Neither is social security. Millenials can’t afford either.
But they’ere going to be partially paid. By those who simultaneously have something left, and lack the connections to pass the bill to someone else.
Those partial payments, will be enough to entice the pensioners to side with those in bill passing positions, as they conspire to squeeze ever more out of those designated as patsies. Just as is the case in Venezuela.
You may not be aware, but both social security and medicare have already started means testing. of course, the spin doctors don’t call it that — but wealthier taxpayers already have their social security confiscated to pay medicare.
Read my lips and give my intern a bj — you will be promised the world but you won’t get diddly.
1932?
The “do it for me generation”…
That really says it all. Helicopter mommy (or daddy) did their homework, arranged play dates, cooked their dinner, did their laundry, wrote their college applications for them.
Mommy “did it for me” for free (or to maximize her own ego / brag to her friends). But what happens when mommy gets old and can no longer do everything for the millenial and (gasp!) needs help herself?
These kids are (supposedly) going to inherit great wealth, but they don’t have the basic skills to manage that wealth. And the fact is, they are not going to inherit their parent’s assets, they will inherit their parents **NET worth** after paying back debts — a MUCH lower figure.
Inheriting their parents NET worth, not assets, then subtracting their own student loans and so on… and they have no idea how to do work for themselves. Marketing to a customer base that can’t pay is a thankless and unprofitable task.
Millennials know a lot more about hydroponic gardening. The pot industry has completely changed over the last decade, and customers reject product grown outdoors as somehow inferior. The entire food industry may have to move indoors to accommodate their disgust with the other than hermetically sealed world. Part of this is growing up in computer dominated environments (temperature regulated). Some of it is global warming. In places like Phoenix you go from your AC home to your AC car to your AC job and back again.
Hipster beard tonic for men , women and the ambiguous and undeclared.
As the home depot exec stated in the above article the Millennials are a ‘Do-It-for-Me’ type of customer. Well who will “do it for ME” when the boomer and genxers skilled tradesman are no longer in the workforce. It will take years for the Houston area to recover due to the lack of labor. Seems that the “snowflakes” don’t want to get their hands dirty.
https://www.agc.org/news/2016/08/31/two-thirds-contractors-have-hard-time-finding-qualified-craft-workers-hire-amid
I recently had to explain to a 30-something ivy league graduate (he claims he was summa cum laude, I can’t verify that but he did graduate from an ivy).
So I had to explain to this guy how to START a lawnmower. As I am explaining the choke and pulling the starter cord… I first have to stop to explain what a choke is.
The thing doesn’t start, and I notice the carburetor looks a little gummed up. And the spark plug is corroded. He tells me it has been sitting in his parent’s garage for the last five years. A little carb cleaner. A little WD40. top off the oil… it starts up.
This ivy league summa cum laude looks at me like I just solved special relativity — for starting a friggin’ lawnmower.
These are the college grads who are going to take over the world? A carburetor eludes them. A lifetime of slapping “Like!!” on their faceplant page probably isn’t going to qualify them to understand computerized fuel injection systems.
This is the group that thinks they can provide “free” healthcare to themselves and their parents… when they can’t even start a lawnmower. And if the Home Depot guy is right, the useless generation can’t even grasp a tape measure.
I have always seen BABY BOOM years to be from 1946 through 1964, DB has it very different and incorrect.
I was in line at a Sprouts in Silicon Valley the other evening. The lines were empty (which is unusual), so three of the cashiers were chatting with one another, comparing ages. They were 24, 24 and 23; two women and a man. They were all fat. Not hugely, enormously fat, but definitely fat. When you’re that fat, it is harder to do projects that require physical labor. Even cleaning your own apartment is harder if you are that fat.
Someone is going to make a lot of money selling cheap house-cleaning robots, to broke, fat young people and to broke, disabled older people.
It’s actually pretty easy to market to Millennials. Just pepper the ad copy with words like “single sourced” and “small batch.” Tell the story of the guy on the assembly line who handcrafted the bauble with care. Include a picture of him if he has an epic beard.
If that doesn’t work, just send ’em a box of parts and let them assemble it themselves. Call it “making” and watch the checks roll in. Actually I can’t believe Home Depot is missing that point, they should be promoting their how-to sessions as a maker faire!
We can operate tape measures and, speaking for myself, I know how to repair cars, grow all kinds of shit (remember us millenials love growing weed). The problem is we can’t afford a house or really anything when wages can’t keep up with prices. So ya, any plan to “market” shit to millenials will fail because we are broke.