Newsday: Small Businesses Tap into Millennial Market
BUSINESS / COLUMNISTS / JAMIE HERZLICH
By JAMIE HERZLICH
Updated August 2, 2015 6:55 AM
Scott McManus, owner of Something Greek in West Hempstead, knows that in a millennial's world everything is instant and digital.
So before the firm puts new products on its website, it first showcases the designs on Instagram to gauge their appeal.
If the Instagram photo gets 100 likes, the company will generally develop the product and add it to its e-commerce site, he says.
"We'll know within 24 hours if it's worth doing," says McManus, whose company sells sorority and fraternity apparel and gifts.
He understands the power of the millennial market -- generally defined as those between the ages of 18 and 34 -- and markets to them accordingly, with social media being a big part of that marketing push.
Missing out on Millennials
But McManus appears to be in the minority.
According to a recent survey from Manta, an online community for small businesses, only 15 percent of small businesses across all industries are marketing to the millennial buyer. The vast majority are missing out on a large and powerful segment of the consumer population.
"Their influence is just beginning to be shown in the market," explains John Swanciger, CEO of Columbus, Ohio-based Manta. "They're only going to get . . . more influential over time so now's the time to educate yourself."
Millennials already account for about $1.3 trillion in direct spending power, according to Jeff Fromm, co-author of "Marketing to Millennials" (Amacom; $24.95) and "Millennials with Kids" (American Management Association; $24.95).
And it's not just their direct spending power that makes them an important market segment for brands, but also their influence on older generations, he explains.
"They influence most of the categories [that] most of the brands are in," says Fromm, president of FutureCast, a Kansas City, Missouri-based millennial trends consulting firm. "It's a combination of purchasing power and trend setting."
That's why it's key that brands understand what FutureCast calls the "millennial mindset." Characteristics include hyperconnectivity (for example, mobile first), and a belief in inclusivity and fairness (such as corporate responsibility).
Millennials are heavy content creators, curators and consumers, says Fromm. They also have a thirst for "affordable adventures," which could be travel but could also be new flavors and the like, he says.
Mobile is a Key Medium
Brands need to understand both the trends and what their brand is capable of standing for, Fromm adds.
Furthermore, they need to develop a message and stay true to that message, regardless of what channels they're operating in, adds Swanciger, who suggests brands investigate what their peers are doing to see what's working for them.
For those who do target millennial buyers, the majority of their millennial-focused marketing takes place on social media (55 percent), followed by their company's website or blog (16 percent) and email (13 percent), according to Manta.
Mobile is a key medium, says Nicole Larrauri, managing partner of EGC Group, a Melville-based marketing and digital services firm, which earlier this year released a series of infographics on millennial buying habits, available at nwsdy.li/mill.
"They are the most reachable in mobile," she notes.
That seems to be the case for Danielle Meyer, 32, of Centerport, a millennial and mother of two with a third on the way.
"I haven't whipped out my laptop in years," she notes. "I mostly use my phone now to shop just because it's easy for me with the kids."
She uses mobile shopping apps like Amazon and Shopbop, which make it even more convenient.
But it's not necessarily one size fits all for millennials, says Larrauri. For instance, a 34-year-old millennial purchasing a vehicle might have different triggers than a 23-year-old.
The older millennial might be a little less price-conscious but more safety conscious, she notes. That's why Larrauri recommends that brands separate the different segments within the demographic.
Companies can use tools like Google Analytics or send surveys to their existing email lists or even use a digital medium like Instagram, as Something Greek does, to gather quick input.
"If you don't know what you're doing you're not going to be relevant to them," says Serkan Ozturkcan, director of marketing for Hauppauge-based Solo, which designs and manufactures bags and tablet cases.
The firm makes a "concerted effort" to understand the millennial consumer, he notes.
"We identify what's really happening socially and economically and make sure we're relevant to that," he says.
For instance, Solo recently launched a digital ad campaign for its bags featuring models that were unshaven and had tattoos, based on research they did on millennials, says Ozturkcan. Many of the models in photos on Solo's website also reflect that unshaven look.
And for the first time, Solo this year had a booth at the Golden Globes, with celebrities stopping by who appealed to the millennial audience including actors from The CW series "Jane the Virgin," notes Ozturkcan. The company tweeted photos of the stars at its booth.
This ties in with the idea that millennials are less interested in status labels and more interested in experiences, says Larrauri. This may mean more brands might want to kick-start their event marketing strategy, she notes.
To be sure, the older generations were much more brand-loyal, says Marshal Cohen, chief retail analyst for The NPD Group in Port Washington.
Millennials are very discriminating shoppers and can be very fickle, he says.
"They're willing to switch brands more than anyone else," says Cohen. They'll switch for various reasons, ranging from price to sustainability, he notes, adding they're very research-centric.
Still, millennials are "very thoughtful and engaging shoppers," he adds. "They have to trust the brand and believe in the brand."
They also expect to be able to interact with their brands and voice their opinion, says Cohen.
That's why McManus relies so heavily on social media including Facebook, Pinterest, Google+ and Instagram to communicate with this audience and garner feedback.
"We answer everybody on social media," says McManus, who also operates FireDepartmentClothing.com and EZCorporateClothing.com. "We have someone monitor it daily."
They are also stepping up their mobile strategy and revamping their website to make it more mobile-friendly.
"If you're not mobile, you're going to be missing a large and growing segment of online sales," he notes.
By JAMIE HERZLICH
Herzlich writes the Small Business column in Newsday.