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Generation Y: purchasing power and implications for marketing.

ABSTRACT

The study examines the buying habits of Generation Y The sheer size of the market of some 80 million strong makes it worth the attention of any retailer. The difference between Generation Y's purchasing power and Generation X's purchasing power is amazing. The income of the younger generation is used for more than just entertainment purposes, such as toys, but also for more adult-like purchases, such as stock. The researchers sought to determine what impact this had on the market compared to Generation Xers.

INTRODUCTION

During the mid to late 1990s, the literature was replete with information about Generation X, the 46 million Americans between the ages of 20 and 33 having come of age in the 1980s and 1990s, and who were dramatically different from preceding generations in terms of attitude, language, culture, lifestyle, orientation, and aspirations (Burandt, 1997-, Morrison, 1997). Today, Generation Y (those boom from 1977 to 1997) seems to be edging out Generation X in terms of coverage in the literature and with emphasis upon the financial clout this group of young people has. Currently, there are said to be some 80 million members of Generation Y, those individuals between the ages of one and 20. "Of the $6.5 trillion spent annually by consumers in the U.S., some $600 billion is spent by the 80 million members of Generation Y" (Gronbach, 2000a, p. 45). Other terms applied to this generation are Echo Boomers (Gronbach, 2000b), Net (or Internet) Generation, Nexters, Millenials, and Nintendo Generation (Alch, 2000).

CHARACTERISTICS OF GENERATION Y

They Have Time and Money

Today's Generation Y teenagers have grown up with a greater degree of affluence than any generation before them. Offspring of the Baby Boomers, today's teenagers, the leading edge of the Generation Y market, are defined by two things: time and money. Because, in most cases, both parents of Generation Y teenagers work outside the home, they have been able to provide their children with four times as many toys when they were growing up as were provided to children of 20 to 30 years ago (Gronbach, 2000a). For example, in 1972, the average child received $50 in toys during the year; in 1992, when the Echo Boom hit, that amount went to more than $200 per child per year (in adjusted dollars). Consequently, today's generation of seven-to-12 year-olds have high expectations in terms of future purchases (Gronbach, 2000b).

Now spanning 3 to 23 years of age, these young people have $150 billion in direct purchasing power today, more than their parents ever had at their age, and about $500 billion indirect purchasing power. According to Teenage Research Unlimited, there are 31 million kids in the U.S. between the ages of 12 and 19 (Barrett, 2000). Teen income was estimated to be $119 billion in 1998, and it has been projected to grow to $136 billion by 2001. The younger members of the Echo Boomers Generation (4-12 years old) had about $28 billion in income (Alch, 2000). Teenage Research Unlimited estimated that Generation Y teenagers spent $153 billion in 1999, 8.5 percent more than 1998. TRU also estimated that this group (those between 12 and 19) would increase by four million (to 35 million) by 2010, making it the largest teen population in U.S. History (Barrett, 2000). Many of these young people are, and will be, living in broken and blended families, having extra sets of grandparents who are happy to add to kids' pocket money (Alch, 2000).

They Are Self-sufficient, Responsible, and Mature

The fact that both parents work outside the home has also made these teenagers more self sufficient, responsible, and mature than any other generation. For example, teens have assumed the responsibility for the family's grocery shopping, giving them a direct impact on the American marketplace. Because they also do much of the meal planning and cooking for the family (including their parents), they shop for prepared foods such as Hamburger Helper, etc., because they want something quick and simple to prepare (Gronbach. 2000b).

They Maintain Credibility with Their Parents

Generation Y teenagers are also affecting the economy because of their degree of credibility with their parents. Today's Generation Y teenagers have greater credibility with their parents than did their counterparts (the Baby Boomers) of 20 years ago who thought that their parents just weren't cool. Today's increasingly responsible teens have a different relationship with their parents who treat them almost as equals and who give their opinions considerable weight in making major purchases. Consequently, today's Generation Y teens have direct input into practically every purchasing decision their parents make (Gronbach, 2000a). This includes every-thing from the homes their parents buy to the cars they purchase. The chances are that if their Generation Y teens like it the parents will buy it (Gronbach, 2000a, Gronbach, 2000b).

They Have Knowledge about Investments

More young Americans own investments today than any other generation of children. According to the results of a survey conducted by Liberty Financial, a Boston money-management firm, 335 percent of eighth through 12th graders own stocks or bonds, with only four percent owning mutual funds. According to William Strauss, Coauthor of the book entitled Millennials Rising: The Next Great Generation, prior to the 1990s, stock ownership among those younger than 20 was essentially zero (Opdykel, 2000).

Meghan Powers, a 17-year-old from Canandaigua, New York, who baby sits for her spending money, exemplifies this trend. Rather than emptying her wallet (of her baby sitting money at the mall, she puts $50 each month into Intel Corporation. This has resulted in her having accumulated $5,195 worth of stock in the tech giant over the past three years. She indicates that her early market experience will make her more confident about money matters than her mother was at a young age (Opdyke, 2000).

According to Lisa Ballek, a fifth-grade teacher at Midland Elementary School in Rye, New York, about 80 children participate in the Stock Market Game, a national investment competition and educational program played by more than 700,000 U.S. students. She indicates that the students in her class six years ago knew nothing about the stock market-, now, however, her 10- and 11-year-olds are asking her about penny stocks they have read about on America Online (Opdyke, 2000).

AJ. Triano, a seventh-grade student at Midland Elementary, watches CNBC each morning to see how the futures are doing and what the market is going to do for the day. He is familiar with financial names like Fidelity, Schwab, and Ameritrade because he sees them all the time on TV and billboards. Along with his sister Kaitlin, a sixth-grade student who also participated in the stock market game, they encourage their family to actively trade via an American Express account, and A.J. has indicated that the family has quickly nearly doubled their money in Goodyear and Disney stocks (Opdyke, 2000).

At no other time in history have America's children been more interested in money. Consequently, an increasing number of mutual fund companies, financial planners', and other investment firms are starting to tailor their products and services toward youth. These youth have come of age during the county's greatest bull market, and they control far more discretionary dollars than their parents or older siblings during their formative years (Opdvke, 2000).

Two years ago, Jonathan Strong, membership manager at the National Association of Investors Corporation, the umbrella group for the country's investors clubs, introduced a -youth membership" and now has 3,300 members under the age of 18. Likewise, Liberty Financial Company's Stein Roe Young Investor mutual fund has more than 23 1,000 accounts. This is an exponential leap from the 4,056 accounts six years ago, with the average investor's age being 11. In addition, the brokerage giant, Charles Schwab and Company recently launched its new Gift Package, "which lets parents, grandparents and other open brokerage accounts for an 18-year-old with as little as $500, a tenth the cost of opening a regular Schwab account" (Opdyke. 2000).

They Are Technoliterate

This new wave has been fueled to a great extent by technology. Today's Generation Y-ers have grown up alongside the Internet, which provides a great amount of easy-to-read information about investing, not to mention the online trading options, which are much cheaper and less intimidating than traditional avenues. Consequently, the young investor doesn't need a car or business attire to conduct business with E*Trade once his or her parents have opened the account (Opdyke, 2000).

Well-informed and media savvy, Generation Y has grown up understanding the new digital economy. Comfortable with the changes brought about by the new technology and e-commerce just starting to come into its own on the Internet, Generation Y, more than any previous generation, is becoming conversant with a communications revolution that is transforming business, education, health care, entertainment, government, and every other institution in society (Alch, 2000).

Generation Y-ers, having grown up with technology in school and at home, are infinitely more comfortable with it than their parents are. Unlike television, the Internet is something over which they feel that they have control. Instant global interaction has been made possible by the revolution in telecommunications, and Generation Y's understanding of the Internet has created a large technology-knowledge gap between themselves and their parents. Consequently, members of the -Net Generation"' represent a potentially more powerful cohort than any previous generation (Alch, 2000).

Mernit, an analyst of Generation Y sum up this group's influence on media tools as follows. "Teens are unquestionably the drivers of this medium. They've made the Internet absolutely part of the fabric of their culture today. It's their rock and roll. In the 50's my parents were focused on being in a band. Today it's being an Internet developer or doing your own website" (Cheng, 1999, p. 30).

Generation Y has already had, and continues to have, a tremendous impact on music and movies, computer software and interactive games. Among the "must haves" of this generation are such things as cell phones and pagers. "What previously was defined as luxuries by other generations are now considered necessities by Generation Y" (Gronbach. 2000a, p. 45).

Generation Y has been raised on movies, television, music, electronic magazines, and electronic games. Nearly 80 percent of this generation has a computer at home, and about half have access to the Internet. Their interests have been developed in a world where there are numerous opportunities to learn via media technologies, such as computers, video, and an array of cable television options. The Internet, thanks to this generation, will continue to be an increasingly important tool in developing and maintaining the relationships with Generation Y. They have spawned huge marketing plans involving a vast diverse majority of promotional techniques, ordering operations, and prospective consumer databases (Gronback, 2000).

They Are Marketing Savvy

While the potential of the Generation Y market is obvious, determining how to win over Generation Y isn't. Teenagers, for example, are notoriously fickle; what is hot one month can be passe the next. At the same time, Generation Y is not favorably impressed with an "in your face, hard-sell" approach to advertising. For example, Nancy Carruth, Target's director of advertising management, stated that the internal market research conducted by the firm over a period of a year and a half revealed that the circulars the company ran in newspapers were not reaching teens at all. Consequently, Target has since gone to their new magalog (a combination of magazine and catalog) to put their brand and merchandise in front of Generation Y-ers without being in their faces (Barrett, 2000).

No shopaholic, David Garman, a 16-year-old from Geneva, New York, typically buys clothes just before the beginning of the school term or over the Christmas break, spending little time during the remainder of the year cruising the mall for fashion. However, he has recently begun reading the Sketchers shoe catalog, the magazinecatalog hybrid, or "magalog," which combines stories on celebrities and trends-including one on feng shui, the Far Eastern art of placing buildings and furniture to facilitate harmony with nature-with the usual product information. While he has already planned to order Sketchers sandals, David says that those stories make the catalog and brand more appealing. "It does make it more interesting," he says. "Just staring at shoes for a while gets boring" (Barrett. 2000, p. 78).

Teens are interested in being able to purchase practically everything that relates to their entire lifestyles from the organizations they patronize, rather than just one or two items (such as clothing) or brand names. Consequently, retailers are pushing to expand their brands to include music, sports, books, and bedroom decorations-just about every facet of the teen lifestyle-to become more entrenched with their teen customers (Barrett, 2000).

The lifestyle craze among marketers is difficult to miss. For example, Abercrombie and Fitch Company may be a clothes company: however, its magalog offers everything from music reviews to advice on travel in South Africa to tips on making cheap feature films. Alloy Online Inc., a catalog and Website operator catering to teens, publishes its own teen novels, poetry, and nonfiction books, all with prominent Alloy Books imprints on the covers with a story of life at a Hawaiian high school, as well as information on products sucli as neon-colored wireless phones on the inside. Making that lifestyle connection and generating customer loyalty among the members of Generation Y are paramount (Barrett, 2000).

Building an image reflecting the Generation Y lifestyle has also helped American Eagle Outfitters Inc. to stage a comeback over the past six years. The firm has cultivated an active, outdoorsy image, and its magalog offers American Eagle branded snowboards and scooters as well as clothes. The magalog even recommends other products (such as an underwater camera and a compact guitar) that American Eagle doesn't sell. According to Michael James Leady, American Eagle's executive vice-president for marketing and e-commerce, "The catalog is now more of a marketing tool than a selling tool" (Barrett, 2000, p. 79).

The Web is definitely a key element for building a broad lifestyle brand. According to Wendy Liebmann, president of New York marketing consulting firm WSL Strategic Retail, Generation Y-ers are heavy communicators, with access to the Internet, cell phones, and Palm Pilots. That's why Alloy has an online mall (emall) that combines chat and entertainment with shopping. The mix has attracted big-name marketers seeking to reach Generation Y. For example. Johnson & Johnson and Procter and Gamble both advertise on Alloy (Barrett. 2000).

They Are Media and Advertising-savvy

A major difference between echo boomers and the preceding generation is the current generation's savvy about the media: The are not pushovers for slick ads. According to American Demographics, Generation Y uses the Internet to find information about products and to make better-informed decisions about consumption (Alch, 2000).

They Are Brand Conscious and Loyal

Also, unlike their predecessors, Generation Y-ers aren't as cynical about advertising as Generation X and the Baby Boomers. "This has created a generation that is brand conscious and loyal"' (Gronbach, 2000a, p. 45).

They Are Interested in Value

Retailers who wish to successfully court Generation Y teens must emphasize value. A series of focus groups conducted in Boston, New York, and Connecticut revealed that young consumers have an excellent knowledge of value. Generation Y-ers are concerned about getting "good deals" and are willing to go out of their way to get them (Gronbach, 2000b).

They Are Not Too Concerned about Cost

Rather than being too concerned about how much an item costs, these youths are more concerned about the total cash outlay. Compared to their Generation X predecessors, Generation Y-ers are likely to pay as much as $5 for a special cup of coffee or as much as $9 for an interesting appetizer, expenses with which Generation X is very uncomfortable (Coeyman, 1999).

They Desire Choices

Generation Y also wants choices. Consequently, employers and insurers are having to rethink the packages they offer. For example,, Generation Y is expected to be less tolerant than previous generations of health plans that limit choice or exclude such things as oral contraceptives (Coevman, 1999).

They Are Socially Responsible

The Echo Boom Generation doesn't appear to be a group of self-indulgent, gratification-seeking, irresponsible shoppers. In fact, surveys indicate just the opposite. They show them to be strong advocates for social responsibility "Like their parents, the baby-boom generation, they care about the world, the environment, poverty, and global issues in general" (Alch, 2000, p. 45).

They Are Concerned about Image

The image a company projects is extremely important to these youths. Generation Y-ers are turned off by those firms that do not maintain a responsible global image. The quickest way to destroy a company now-a-days is to project a negative corporate image (Neuborne, 1999).

They Are Enviromentally Aware and Concerned

Members of Generation Y have grown up being environmentally aware. They want clean, fresh products that don't involve testing on animals or that have a potential ozone laver damaging quality (Neuborne., 1999). They like things that are "green." They related well to causes that help the environment and make the planet better for all people (Gronbach, 2000b, p. 36). They also know enough about damage control to ask the right questions (Neuborne. 1999).

They Are Optimistic

Generation Y seems to be more optimistic than preceding generations. There are a number of similarities between them and the GIs who returned home at the end of World War 11 because they value the community over the individual (Gronbach, 2000a).

They Are Brand Conscious and Loyal

Unlike their predecessors, Generation Y-ers aren't as cynical about advertising as Generation X and the Baby Boomers. "This has created a generation that is very brand -conscious and loyal (Gronbach, 2000a, p. 45).

HOW CAN MARKETERS REACH GENERATION Y?

Given the characteristics of Generation Y, how can marketers reach this powerful group of consumers? They must get inside their heads; they must relate to their needs and understands how they think, where they spend their time and money, and what moves them (Gronbach, 2000a).

When they aren't in school, Generation Y-ers spend their time with radio, television, and the Internet. They need to be "talked to" where they live. This means using street marketing (or guerrilla marketing). This is a form of localized, personalized, non-conventional marketing which includes such things as give-aways, samples, and special events. For example, one athletic shoe company sends people out to watch kids play basketball and gives the best players a pair of shoes (Gronbach, 2000a). Target goes a bit further by giving away two Saturn cars per month to Generation Y-ers with newly minted driver's licenses (Barrett, 2000). Another retailer who caters to teens also uses street marketing when the firm opens a new store. Representatives are sent out to areas around the local schools to give away T-shirts, water bottles, and other goods which feature the retailer's logo (Gronbach. 2000b).

Generation Y teenagers love "Teen Clubs." "'They really like club-type cards that they can carry in a wallet, things that give them a feeling of affiliation. They also like the fact that those memberships bring special discounts and free merchandise that's just for them" (Gronbach, 2000b, p. 3 7).

While conducting focus groups with members of Generation Y, consultants discovered that these young people are smart, aware, and fair-minded. They like to be entertained in the ads that are directed toward them. They appreciate spoofs and anything that makes them laugh. However, they don't like to see ads that make fun of anyone (Gronbach, 2000a).

Marketers should develop promotions that are geared directly toward Generation Y. "They appreciate campaigns that show an understanding of their needs and an interest in them as customers. They respond well to campaigns that directly tell them what an advertisers has just for them" (Gronbach, 2000b, p. 3 7).

Regardless of what one is selling, the individual must establish a teen-friendly environment. Nothing could be worse than launching a major campaign which successfully brings teens into a store which is not teen-friendly. Rather than staffing the store with older employees who appear to be distrustful of teenage customers, hire teens. Other Generation Y teens will feel more comfortable buying from them, and one can expect their friends to visit them and shop while they are there. If it is a clothing store, the retailer should expect the teenage salespersons to wear their clothing brand while on the job (Gronbach, 2000b).

Radio and television are appropriate media for attracting the teen market through mass marketing efforts. Generation Y-ers aren't as cynical about advertising at are the predecessors, Generation X and the Baby Boomers. "This generation is very brand-conscious and loyal-a fact that bodes well for advertisers" (Gronbach, 2000b).

Direct mail can also be very successful with the Generation Y market. First, it addresses their fondness for anything that is personalized for them. Second, it allows marketers to deliver tile free gifts, samples, and club-type cards they love. However, on the negative side, marketers can't purchase lists with the addresses of teens. The best they can do is to buy lists of households where teens live and hope that the mail reaches them (Gronbach. 2000b).

While the Internet is a promising means by which to market the teenage segment of Generation Y, the numbers aren't appreciable at this time. Having grown up with computers in school and at home, Generation Y takes the Internet for granted. "It has always been a part of their lives and its importance will continue to grow" (Gronbach, 2000b, p. 38). However, the teenage segment of Generation Y has not yet made its full financial impact when it comes to online spending. While teens spend a great amount of time on the Internet, few go online specifically to shop. The results of a PriceWaterhouse Coopers survey indicate that "while more than one-fourth of teen Internet users regularly go online to shop, only two percent say that shopping is their primary reason for going online" (Gronbach, 2000b, p. 38). It is inevitable, however, that these numbers will continue to increase.

The teenage segment of the Generation Y market (actually, the group includes those between the ages of 10 and 19) can be subdivided into three sub-markets or niches toward which marketers may direct their advertising and promotions. The three segments are pre-junior high, pre-driving age, and high school.

The pre-junior high bracket includes those children who are between the ages of ten and 12. While the boys in this age bracket care about what they wear, it is the girls who are the big spenders and who are beginning to make their mark as consumers. Since these children are dependent on their parents for transportation and money, they shop with their parents; however, they are already developing their own style preferences. In addition, they are beginning to feel peer pressure and are responding to it.

The pre-driving teen set, those between the ages of 13 and 15, are also dependent on their parents for transportation but often shop with friends. Parents often drop these children off at the mall, and the kids will pick out their own clothes and other items they choose to purchase. Parents have little influence over what their children wear at this state; however, they can exercise veto power over purchases by refusing to pay for them.

The 16-to-19-year-old teenagers shop almost entirely on their own since most of them have access to a car. Parents have little input at this stage. This group of teenagers buys what they want and often pay for it themselves. There is an exception, however, at back-to-school time since this is a time when substantial sums of money may be spent. Parents often accompany their teenagers and pay for their clothes purchases. So they do have some input into the decision-making process (Gronbach, 2000b).

THE IMPACT OF GENERATION Y

One of the biggest mistakes any marketer can make is not to pay attention to the Generation Y market. Nevertheless, many marketers have ignored Generation Y because they think they are "just kids" without the cash to spend (Gronbach, 2000a; Gronbach, 2000b).

The Echo Boomers (Generation Y) are a particularly powerful market segment because they are used to having a number of possessions (Gronbach, 2000b). "These children (now ages 1-20) are the offspring of the Baby Boomers, and marketers can expect their effect to be similar to the impact that their parents had during the 1960s" (Gronbach, 2000b, p. 36).

"This generation of consumers will create a new economic boom of increased productivity, real-wage gains, rising savings, and falling debt. They will create a new culture of work, characterized by more independence in the work force. Many of these future workers will become entrepreneurs" (Alch, 2000, p. 42).

Demographers, market analysts, and researchers already realize that this new group will dominate marketing in the twenty-first century (Alch, 2000). The sheer size of the Generation Y market demands the attention of marketers. Add to that the fact that the 12-to-17-year-old segment also has influence over another enormous market-their parents-and one has a group of teenagers with unprecedented economic clout. Today's teenagers now, have direct input into almost everything their parents purchase (Gronbach, 2000a).

The payoff can be tremendous for those marketers who manage to bond with this generation. The key will be to keep in step with the latest image today's teens want to try on for size (Barrett, 2000).

IMPLICATIONS OF MARKETING

Having grown up in a period of relative world peace (comparatively speaking), the Echo Boom generation has been more able to concentrate on themselves and their immediate interests and a comparatively secure future than preceding generations. Having grown up with more possessions will probably continue to grow.

Those individuals included in Generation Y today between the ages of three and 20 are said to have $150 billion in direct purchasing power today and about $500 billion in indirect purchasing power. This is represented by the fact that those members of Generation Y between the ages of 12 and 17 have tremendous influence upon the purchases (including cars and homes) made by their parents. Even children between six and ten years of age significantly influence their parents' purchases: this is especially true in terms of children's clothing purchases.

Estimated at $119 billion in 1998, teen income alone is projected to increase to $136 billion by 2001. Younger Echo Boomers (between the ages of 4 and 12) had almost $28 billion in income. Generation Y teenagers alone were said to have spent $153 billion in 1999, an 8.5 percent increase over their spending in 1998. The teenage group alone, now numbering 31 million, will increase to 35 million by 2010. There is no reason to believe that their spending habits will not also continue to increase as this segment of Generation Y continues to come into its own.

Consequently, today's Generation Y is undoubtedly the wealthiest generation to have grown up in the U.S. in the history of the nation. For any marketer of the types of goods and services that these young people desire to assume that they are "just kids with no appreciable purchasing power" would be a grave mistake.

However, no marketer should take Generation Y for granted. That is to say that the one-size-fits-all marketing approaches that may have been effective traditionally are no longer effective, especially for this new generation of young people. Marketers must realize that today's young people (Generation Y) are intelligent, aware (not only nationally but also internationally), and fair-minded (for themselves as well as for others). Consequently, marketers must pitch quality and value in attempting to reach this generation: they must show an understanding of this generation's needs; and they must show respect for Generation Y-ers as customers.

Marketing and promotion efforts must be geared specifically to Generation Y; these consumers must be shown the types of products and services that a marketer has just for them. Products and services that can be "personalized" and which meet their needs will be appreciated and accepted.

Being the most technoliterate generation in history, today's Generation Y will continue to be attracted by improvements in computer technology and software (including both educational and recreational games). Generation Y-ers enjoy and appreciate the challenges and satisfaction that these types of products provide. The same can be said for technological improvements in fields such as music, television, and wireless communications. Anything that is recent, new, interesting, and challenging can be expected to attract the interest of Generation Y. The extent to which a greater number of activities or services can be enjoyed through an individual medium (such as television, a computer, or a cell phone) will fascinate, attract, and therefore sell Generation Y on the resultant product or service.

It is common knowledge that the teenage segment of Generation Y go online and surf the net much more frequently than the preceding generation. However, although approximately one fourth of the teen Internet users frequently go online to shop, only about two percent indicate that shopping is their primary reason for going online. Nevertheless, this is a promising means by which online marketers can cultivate the loyalty of this segment of the market by making it easy for them to shop online. Marketers need to organize their sites by targeted areas of interest and provide user-friendly navigational instructions for online shopping (Gronbach, 2000b). Targeting the three segments (pre-junior high, pre-driving age, and high school) with the appropriate advertising and promotional information may prove to be tremendously advantageous for marketers of various types of products and services. Targeting these teenage sub-markets should be a vital part of most advertising programs. Teenagers have tremendous influence now; however, it will only increase in the future (Gronbach, 2000b).

Given Generation Y's willingness to spend money, the amount of money, at their disposal, and their familiarity with technology, the Internet's power to reach young consumers should not be underestimated. It is imperative that marketers provide Web sites that to the under 18 consumers (Neuborne, 1999).

Given the fact that today's younger generation is much more tolerant of and much more receptive to diversity, Generation Y is a multicultural group. The,--y travel in mixed races and socio-economic classes. They are globally inclusive in terms of race, gender, religion, and state of environment. Consequently, marketers must not only recognize this phenomenon but also develop and implement advertising and promotional strategies to reflect and appeal to this diversity (Neuborne, 1999).

Today' parents and grandparents continue to be interested in and concerned about assuring a financially secure future for Generation Y-ers. As a result, they continue to purchase stocks (including mutual funds) and bonds for their children to make this possible. Generation Y-ers are using some of their own earnings for the same purpose. Therefore, financial institutions should develop investment portfolios that meet the needs of Generation Y. By developing this relationship with these consumers at this stage of their lives, such financial institutions should be able to maintain this relationship through the remaining stages of their life cycles.

Generation Y members are not only interested in their present well being, but they are also looking forward to a bright future. For example, today's teenage segment of Generation Y will be tomorrow's college students and graduates and entering their respective professions and careers. As they move into the "real world," they will be utilizing the same consumer habits they have developed as members of Generation Y whether they are buying cars, homes, or mutual funds. Those companies that are able to develop a close connection (a key word in Generation Y's vocabulary) will be in a better position to maintain that connection in the future than those companies who aren't able to do so. Consequently, marketers must be attuned to the changes today's Generation Y members will be making as they enter the next stage in their lives. The implication is that if marketers are skillful in meeting the needs of Generation Y today, they should be intent on keeping them as customers as they move into the next stage in the live cycle. That is to say, that as this particular segment of the market makes lifestyle changes, so, too, must there be changes in the advertising and promotional efforts directed toward them on the part of business firms if they expect to be successful in maintaining their patronage.

CONCLUSION

Overall, the decisions of Generation Y youth have a tremendous impact in today's society. With 80 million members, their decisions affect many economic choices. These include the choices of their parents, whether they are purchasing an item as simple as clothes or a larger expense such as a car. Technology is taking over the world, and Generation Y is helping to further the advancements. Their familiarity and ability to utilize today's technology puts them ahead in the acquisition of information. Logging on to the Internet is an everyday activity, where these young adults read news, interact with other people all over the world, shop, and just indulge themselves in a world in which Generation X was not as quite familiar with. Teens raised in a home with two wage earners tend to be more self-sufficient. They are allowed to help make choices in which the previous generation did not even consider thinking about. This has also led them to be more responsible, more mature, and to have a higher purchasing power. Generation Y youth are the generation members who are influencing and changing the goals and aspects of the future. Generation Y will definitely have a tremendous economic impact on our society today since it is larger than Generation X and the Baby Boomers.

REFERENCES

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Roy Farris, Southeast Missouri State University

Frank Chong, Southeast Missouri State University

Darlene Dunning, Southeast Missouri State University
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Author:Farris, Roy; Chong, Frank; Danning, Darlene
Publication:Academy of Marketing Studies Journal
Geographic Code:1USA
Date:Jan 1, 2002
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