Archive for June, 2016

Desperate to find the secret of the millennial code, media and researchers have taken creative license over the past fifteen years which in the final analysis, hasn't provided the hoped for guideposts that would convert marketing strategy into new consumers - at least as it relates to the wine business. But it has created a dialogue overblowing the impact of our youngest cohort (eg, above video.)

Outside of the odd research gaffe, I see the failure to deliver reliable findings emanating from two directions: 
1) over-generalizing an ethnically diverse generation, and, 
2) delivering predictive interpretations on the group as if they would never evolve. 

The 6th graders of 15 years ago are 26 today. Maybe they wore footed Barney pajamas back then, but their tastes and preferences have changed.

Evolution and Idealism

Woodstock - NY

Boomers went through an evolution too. Stealing a thread from one of the comments in Part 1 of this post, boomers lived through the Summer of Love and saw the world through idealistism tinted glasses. 

All you need is love, anti-establishment and anti-materialism movements evolved into a cohort with the highest divorce rate in history; a group that wholly 'sold out' becoming the Establishment, and then the greatest consuming generation of stuff - to the point where 70% of the U.S. GDP depended on boomer materialism. If Madison Avenue actually locked down boomers beliefs when they were young, The S&P 500 might have only been the S&P 164.

All that said, I hear one common refrain: While boomers might have changed to become the biggest per capita consumers of wine in U.S. history, that doesn't mean millennials are going to follow suit. 

That might be true, but I see growing evidence that makes me believe this young consuming group aren't the three-eyed Unicorn's put forth in media and they will follow the same evolutionary path as the consumers before them.

Expert Testimony

“What we’ve seen is that every single generation enters the work force and feels like they’re a unique generation, and the generation that’s one or two ahead of them looks back and says, ‘Who are these weird, strange kids coming into the work force with their attitudes of entitlement and not wanting to fit in?’” Mr. Bock said. “It’s a cycle that’s been repeated every 10 to 15 years for the last 50 years.”

Google’s human resources department is famous for collecting and analyzing data about its work force to empirically back up its management techniques. Google’s workers range from recent college grads to people in their 80s. And as far as Mr. Bock has been able to tell, millennials, as a broad category, simply aren’t very different from everyone else."

Bottlerock - Napa

• They are likely to continue to be more financially conservative than their spend-a-holic credit driven parents, saving more and spending less of their paycheck. 
• Not surprisingly, they don't trust that markets will always go up so they think a little different about major purchases and investments.
• Student debt will continue to be a drag on their spending and impact their big ticket purchases like cars and houses. Today the small house phenomenon and Uber for that matter (the sharing economy) are evidences of their rent versus buy preferences. Affordable luxury is a draw.
• Ostentatious gilded luxury goods fell out of favor when the economy tanked. There is still a desire to display luxury, but it has to be done within architecture that seems more industrial than luxury.
• Perhaps not isolated just to the younger generation, but nonetheless countless studies are being written about their preferences for experiences - and cost does play a big role in that. Important to grasp is while they don't mind ownership, they have broken out in their minds the experience something provides, versus the need to own it.

1. Will millennials become boomers when they grow into their spending years?
2. What other ways has the great recession impacted the young consumer?
3. How will you market your wine to this soon to be important wine buying cohort?