Last week the New York Times published Farhad Manjoo’s “Corporate America Chases the Mythical Millennial”. In short, Manjoo makes the claim that we shouldn’t lump all 18-35-year-old millennials together because “millennials aren’t real.”
Manjoo makes some great points. For example, it is absolutely important to keep in mind that generational theory looks at broad societal trends and often needs to be supplemented with more nuanced research and strategy. Watershed’s research division does just that. We make sure to take into account variances within a generation, such as socio-economic factors and life stage. A consumers’ financial situation has a real affect on a person’s day-to-day behavior. But there is a difference between behavior and mindset.
Manjoo’s claim that “millennials are not real” is a bit strong. Intuitively it makes sense that those who come of age during pivotal societal events will be shaped in someway by those events. Baby Boomers came of age as America hit peak affluence. They took advantage of widely available government subsidies. That absolutely impacts the outlook, expectations, and behaviors of a group of people, including how they raised their children (the millennials).
The data supports this. For example, Manjoo, at one point, downplays differences in religion by generation:
“In a 2014 Pew study, 29 percent of millennials said they weren’t religious, versus 21 percent of people in Generation X, which Pew defined as those born from 1965 to 1980. What this means is that most millennials and most Gen Xers — and, indeed, most Americans — consider themselves religious in some way. Millennials: They’re just like us!”
But there are a few things wrong with this claim. First, 29% compared to 21% is a big, and statistically significant, difference. 8% is the equivalent of 6 million millennials. Let’s keep in mind that this is only one PEW data point. PEW has come out with many surveys that reinforce the notion that millennials are less trusting of organized religion, such as “Millennials’ ratings of news media, religious organizations decline” from 2015:
“Since 2010, Millennials’ rating of churches and other religious organizations has dipped 18 percentage points: 55% now say churches have a positive impact on the country compared with five years ago, when nearly three-quarters (73%) said this. Views among older generations have changed little over this time period. As a result, older generations are now more likely than Millennials – who are much less likely than their elders to be religious – to view religious organizations positively.”
Manjoo suggests that all the information we need about consumers is already out there, that we have no need to talk about generations. But the data he points to instead – “purchase and employment histories, social media musings, educational history, and credit report” – is collected in response to what products are already on the market. For example, job history can only look at jobs and companies that already exist. Social media conversations tend to revolve around TV shows already on air. These are measurements of behavioral data.
To understand a consumer mindset, we have to dig more deeply than behavioral data. This is the benefit of considering generational differences; it is a method of understanding consumer attitudes. Companies that understand consumer mindsets can create new, innovative products that customers don’t even know they want or would use. The iPhone is a prime example. Microsoft CEO Steve Ballmer famously laughed in reaction to the original iPhone in 2007. He said:
“That is the most expensive phone in the world. And it doesn’t appeal to business customers because it doesn’t have a keyboard, which makes it not a very good email machine.” – Wired
Over time, Ballmer was proven wrong. Apple does market research, but not traditional market research that asks consumers to test new products. Rather, Apple learns about its customers and their mindsets to find gaps in existing markets or product lines. Apple uses this information when creating the next big thing. Generational theory is a useful tool for understanding consumer attitudes, which is a cornerstone of innovation.