For the past 10-15 years anyone who sells consumer products has talked about the Millennials. My three sons are part of this huge demographic group that represents the spawn of the Baby Boomer generation. For all the talk about how unique and different the Baby Boomer generation was from its Greatest Generation parents, their consumer patterns were just as likely to be driven by Madison Avenue advertising as their parents. Albeit, we (yes, I am a Baby Boomer) consumed more and at an earlier age. Most of us had more disposable income than our parents, or we simply disposed of more income than our parents (this is going to be a horrific wake-up call when Baby Boomers start retiring…retiring? That’s funny!)
The Baby Boomers encompass two really disparate groups; the Hippie/Vietnam and Yuppie groups. My brother who is 12 years older was the Vietnam era Boomer, I was the Yuppie Boomer. Ironically, both these groups ended up by and large buying into the American Dream. Both wanted to own single family homes (Americans were never meant to live in communes…sorry Don Draper, but you would have gone back to swilling bourbon and buying Cadillacs), buy two cars and send their kids to good schools.
We became very much like our parents regarding consumption. However, like I said…we just consumed more. There were more products to buy, food to eat and places to go. Our kids played more sports (soccer anyone?), with hideous levels of involvement from parents. Neighborhood pick up games disappeared. Everything was managed in controlled environments by parents. No law of the Kid Jungle was ever learned. I could just imagine telling Fat Jimmy from my old neighborhood he couldn’t punch me again because I was in a “safe zone”…I would get punched harder.
Now this Millennial generation is coming of “consumption” age. Generally they are doing it later than my generation did. They stay in school longer, marry later and start having kids in their 30’s. My wife and I were done at 30 having kids, not starting. I hope Millennials eat a lot of Kale (what we called garnish on restaurant plates) to have enough energy in their later years to deal with younger kids.
To date, Millennials are a mysterious group when it comes to consumption. It is well documented that they are the generation that has a hard time getting started in life. There are more college graduates and less jobs. This lack of financial opportunity has aided in muddying the consumption patterns of Millennials. This has been confirmed by my new fact checking research assistant…Mickey. Finn the black lab is getting long in the tooth and a little out of touch with Millennials, so I brought on a young trainee. Mickey the Millennial has several degrees and was working as a Bark-ista before he accepted the job. It’s an unpaid internship that provides room, board and kibble.
Just as Baby Boomers revolutionized the wine product category over the last 30 years, Millennials will have a major impact on the amount and types of wines sold in the United States for the rest of my life. I’m not sure what they want, but I do watch and listen to my boys, their wives and friends. Here’s what I have seen about Millennials with respect to wine:
· They are a huge demographic group. They may not have purchasing power now, but they will. Ignoring them is a mistake. Just like those wine brands that didn’t change with the Boomer’s tastes (varietals, regions, taste profile), current wine brands that don’t market to them will suffer.
· They are plugged in 24/7. Show me a Millennial without a smartphone. The speed and amount of information that they have in the palm of their hand is mind boggling. There is not much you can’t find out about a bottle of wine before you buy it.
· They like unique. They like authentic. They like special. This is very tough when you are trying to develop brand loyalty, which to some degree relies on repeat customers. It’s tough to develop products if they constantly have to be changed. This will inevitably compress the life cycles of brands.
· They will try anything. My boys will talk to me about wine and food that I have never heard of. For a bunch of guys that went crazy as kids if we got anything but a Happy Meal for them, it’s a strange conversation.
· They have a lot of student debt. Do you hear the ticking time bomb? Debt payments mean less money for wine. They look for value buys.
· They believe in the “share” economy. “Stuff” seems less important to them. They are happy to share apartments, Lyft lines, office space, etc. What happens to the luxury consumer items when you can’t get consumers to see your product as aspirational? If you’re selling a $50 bottle of wine, you need that consumer to associate more than the quality of the wine to that product.
All of this could be a blip in the Millennial maturation process. I think it’s hard to judge how this generation will ultimately play out as consumers. Call me old fashioned (and many have) I believe Millennials will get married, have families and fall into a more reasonable consumption pattern. Kids tend to soften the, “everything we do is unique” aspect of life.
However, I have no doubt this generation is more wine savvy, better educated, better traveled and far less susceptible to the usual marketing pitches that were successful with prior generations. They have more information than any other generation in the history of the world.
You know what would go well with all that knowledge…a glass of wine!