Finance


Millennials




FINEX Folio
By Flor G. Tarriela

Posted on February 26, 2016


Millennials now comprise the majority of today’s workforce. Who are the millennials? They are those born between the early 1980s and the early 2000s, also known as Generation Y, after Generation X -- born between the early 1960s and the 1980s. Millennials look just like everyone else -- but they are motivated differently and have different world views and preferences.

Millennials were born right smack at the center of the digital revolution. The information age was exploding, the Internet was catching fire, cellular phones were revolutionizing communications and cable television in real time. They had first row seats to whatever was occurring anywhere in the world. And they grew up accustomed to having anything in an instant.

The one main distinguishing fact about millennials is that they are extremely tech-savvy. According to the landmark study “Connecting with the Millennials” sponsored by Visa, one in two Filipino millennials said they can’t live without their personal computers or laptops, while 37% said a smartphone is a “must-have.” The same study revealed that Filipino millennials use instant messaging on computers 73% of the time, as well as social networking sites, 71% of the time. The study further showed that Filipino millennials set aside 12% of their disposable income on electronic gadgets.

Millennials are emerging as the world’s next biggest consumer market, with an estimated $1.99 trillion spending power globally. Yet according to CEB Iconoculture research, success doesn’t necessarily mean material wealth for this audience, but is rather defined by personal satisfaction. Millennials value success, growth and comfort.

For millennials, value is everything. On their purchasing behaviors, gadgets seem to be evaluated not on how much they cost or look but based on applications they can do. They have apps for everything -- for budgeting, scheduling, decorating, styling, driving, et cetera -- and they use these apps. They know they don’t have to do things the long, hard, manual way.

Millennials are practical people. They go for value and look at factors such as efficiency and long-term viability. Toyota Motors, according to reports, phased out Scion, its edgy small car brand specifically targeted for millennials after they realized that for this generation, owning cars is not a priority. Most millennials are not auto-centric -- they would rather use car-sharing platforms such as Uber and Grab, or buy reliable second-hand cars rather than invest in cars.

How to market to millennials? Joven Hernandez, President of PNB Savings, shared tips from 8 Rules of Marketing to Millennials by Maila Kue of Brogan & Partners Convergence Marketing and here are four of them:

• “Don’t just tell them what your product is or can do. Show them how it will make them feel. Millennials are motivated to do things by feelings.”

• “Inspire to do good. Millennials are a proactive generation that desire to change the world. They support a service/ product that contribute to a greater cause.”

• “Good design is mandatory.” Millennials are very visual. It’s not just the product but its presentation in an unusually creative way is KEY.

• “Don’t compromise who you are.”

More millennials are rising to leadership positions faster. They become managers in their early twenties. This is also partly because they are more tech-savvy and therefore more attuned to the new work environment. They have the capacity to grasp ambiguities and apply themselves to the many challenges of an increasingly complex world.

So, how do we deal with millennials? Most companies now have multi types of employees: Gen X, Y, and the Baby Boomers. Motivation is a big challenge, especially for millennials. To engage millennials, their superiors need to understand that they are divergent, indeed, but the differences that they bring to the table can be a major source of advantage if harnessed positively. Their constant need for challenges can be an awesome mine of ideas on how the workplace can be made smarter.

This is a generation that is open to mentoring relationships, but one that is based on trust. The more matured millennials can accept that some millennials know more stuff than they do, and that millennials can access information far faster than others ever can -- after all, they are the first generation to master living in a world with an online component. Make them understand, however, that your experiences and your method of thinking can give you a different insight that they may have missed. If there is anything a millennial will like to hear, it’s a properly-given point of view.

The key word for millennials is engagement. This is a generation that needs to be involved -- actively and passionately. They are just not interested in things they cannot relate to or find no relevance whatsoever in their own lives. And because millennials are emerging as the biggest consumer market globally, marketing to millennials is a real challenge. Organizations need to really understand their psyche and align products and services to their specific needs and preferences. Customization is not an option, but an absolute requirement. More importantly, they demand real value.

Yes, we need to understand the millennials better, to know how to deal with them not only as a customer base but also as our growing workforce and emerging new leaders. Oh, with their number, they will certainly be a big factor in May that will determine our country’s future.

Flor G. Tarriela is Chairman of Philippine National Bank and a FINEX Trustee. She was formerly Undersecretary of Finance. First Filipina Vice-President of Citibank. A natural gardener and environmentalist.