Cat Flag’s Guide to Understanding Millennials: Brands that “Get It”

Millennials image from CSU Long Beach

When I first started this series about my generation, I mentioned the fact that Millennials are the largest generation in U.S. history. Naturally, our sheer numbers make us an irresistible target for many marketers, who try to make their brands appeal to our tastes and sensibilities. Right now, we are at that sweet spot from a marketing standpoint: we’re just old enough to make our own choices in the clothes we wear, the food we eat, the cars we drive, and so on, but we haven’t yet reached the point where we will tend to just buy the brands we are already familiar with and not be easily swayed to try new things.

Just a quick Google search will take you to hundreds of articles on “How to Market to Millennials”, like this one or this one. Of course, it isn’t really that easy to market to anybody. If there were one simple formula to follow to appeal to Millennial customers, the economy would be doing far better than it currently is. As it stands, it seems to fascinate me which brands seem to “get it” and which don’t. This week, I’m going to focus on four brands that have succeeded in capturing at least a big part of the Millennial market. This list is far from exhaustive, but I think each of the companies here provide a nice case study to examine.

Scion badge from Wikipedia

I actually don’t care for these cars. Cars that look like boxes just aren’t my style.

Seriously, just LOOK at how ugly that thing is.

Seriously, just LOOK at how ugly that thing is.

Having said that, I see Scion cars all the time when driving around the Cal Poly campus. This is no accident – the “Scion” brand was launched by Toyota in the United States specifically to capture the youth market. It has certainly succeeded at that, being the brand with the lowest average and median age of its customer base.

How did they do this? Partially, they did this by embracing new advertising and marketing techniques, such as advertising online, using social media sites like Facebook and Twitter to spread brand awareness, and even launching its own internet streaming radio service. They were really early pioneers in exploiting the technology-driven youth culture for viral marketing, a technique that many have since copied. Another big part of their success has been an emphasis on customization, as seen in this ad or this one. Scion cars have all manner of options where you can change this or that aspect of the car’s appearance. Each Scion can have the rims, pedals, dashboard, and so on tailored to match the customer’s idea of “cool”, playing on our fascination with super-suped-up and ultra-modified Fast & Furious-style cars that we can’t actually afford.

Having said all of that, though, Scion has run into a major problem since the recession hit: Millennials who aren’t buying cars. While Scion has gone from literally not existing to a major player in the market of young adults buying their first cars, the fact is that the bad economy, high unemployment, and the rising costs of college makes it hard for many Millennials to afford a new vehicle. While the brand has been making the most of the customer base it has, and has recently seen sales improve with the introduction of a new sports car called the FR-S, it will probably be some time before the brand can really take off. Which brings me to a far, far bigger success story…

Zipcar logo from Maryland Institute College of Art

The idea behind Zipcar is basically like a combination of a rental car, a taxi service, and Costco. People pay an annual fee to become a “member”, and then download an app on their smartphone that lets them reserve a car for a specified period of time, from a half-hour to 24 hours. They pay Zipcar for the amount of time they have reserved, and in return Zipcar pays for gas, maintenance, insurance, and parking. For somebody who isn’t able to afford a car, this is a brilliant and highly cost-effective alternative. For college students who struggle to pay the ever-rising costs of tuition and student loan debt, and can barely scrounge together the change for the college dorm laundromat, Zipcar could very well be the only reliable means of transportation they can afford. Plus, “carsharing”, as programs like Zipcar are known, is far more eco-friendly than everybody driving their own car, burning gas and clogging up the highways.

Is it any wonder, then, that Zipcar has taken off like a rocket in the past few years? It seems every few weeks, the company announces it is expanding into some new city. Even Cal Poly now has a Zipcar service. It posted its first sustained profit in 2011, and then its profits tripled last year. Its success has brought it to the attention of more traditional car-rental services; it has just been acquired by Avis this past year for $500 million. What can I say? This company found a way to plug a gap in the transportation marketplace that nobody even knew existed, and customers, especially young customers who can’t afford cars of their own yet, flocked to it like nobody’s business.

Speaking of saving money…

Kohl's storefront image from Business Week

I love Kohl’s. I think it is one of my favorite stores right now. Who can argue with a company that rewards customers just for shopping there by automatically giving them a gift certificate for a future purchase? In the area where I live, Kohl’s usually is the store with by far the best prices on the clothes I need, and is also one of the best places to shop for kitchenware. No major shopping trip in my house is complete without at least stopping in to check out what is on sale. For a generation that is generally broke more often than not, any money-saving is well appreciated. Study after study shows that we value getting the best value for the price.

It isn’t just the prices that attract me, though. Kohl’s also very clearly panders to my age group. The models in the pictures on their walls are mostly about my age, the music they play is the pop and rock songs that most of us listen to, and they carry many brands that cater to our tastes, such as Tony Hawk shoes, Rock&Republic jeans, and a brand new Jennifer Lopez-branded jewelry line. Normally, this sort of flagrant pandering would trigger my cynicism reflex, but somehow the store has managed to make these touches just subtle enough that it doesn’t come off as in-your-face. It’s a delicate balancing act, and it is far harder than Kohl’s makes it look, but they have managed to pull it off. I guess that’s how you wind up listed in the Fortune 500.

Now, I know what many of you are thinking: “You said Millennials are all about technology. Don’t you all buy everything online now?” I would have though that, too. However, a study that was recently conducted on those of my peers that now have children of their own found that Millennial parents actually prefer shopping at brick-and-mortar stores than online. Maybe raising small children makes young parents sometimes feel cooped up and want to get out of the house. In any case, Kohl’s also has a really good website for those who do shop online.

So far, the fact that we Millennials, for the most part, just don’t have that much money to spend has been a consistent theme in these case studies. One article I found even called us “The Cheapest Generation”. Having said that, being thrifty all the time takes work. Sometimes, we just want to spend an evening out with friends, and not have to worry about price so much. If we have saved up for an occasional treat, one thing we might do is go out to a restaurant to eat. Which brings me to what is possibly the most surprising entry on this list…

Chipotle Mexican Grill logo from Child(ish)

Eating at Chipotle is not cheap. At all. But, boy oh boy, their food is absolutely delicious. If you haven’t tried their barbacoa tacos with guacamole yet, you are missing out.

Not only is their food delicious, it is also fresh, healthy, and eco-friendly. They make their fresh guacamole and tortilla chips daily, their meat comes from humanely-raised animals that are not treated with hormones, and their veggies are all organic. If this all sounds like hippie-speak, well, it is. It is also the reason for all of those high prices.

Having said that, from my experience, Millennials have a much keener understanding than I have seen in any other generation that capitalism is a democracy where we vote with our dollars. We are urged to come out and support products we like or companies with business practices we want to see more of, and there are also apps you can use to find out what companies make what products so you can boycott those companies you don’t like.

Chipotle not only makes really, really good food, but it also taps into my generation’s “fix-the-world” mentality to make us feel good for eating their burritos. In this way, they have managed to become the most beloved restaurant among Millennials according to a study conducted by L.E.K. Consulting. Now that is some brilliant marketing at work.

Do you know of any other brands that have done a good job attracting Millennials? Do you disagree with the examples I chose? Let me know in comments below!