Much has been said about millennials, a 2.2 billion strong cohort which spans people who are in their late teens today to those in their early 30s. They’ve been described as an open, socially-conscious, optimistic and technologically-connected generation. What could not have been predicted is the profound effect of recent economic trends on their outlook and behaviours. In today’s stagnant developed markets, many young people have had to recalibrate their horizons as the affluence of their parents and grandparents may no longer be in their reach. Meanwhile, in emerging markets many millennials now enjoy unprecedented incomes and opportunities for new experiences.
Despite these differences there are three key trends shaping the lives of millennials, which spa, wellness and fitness facilities can tap into to connect with them.
Firstly, millennials across the world are facing new types of pressures, whether from the bleak job market and sluggish career ladders of the developed world, or from the rapid urbanisation and social transformation of emerging markets. This places a premium on experiences that help them switch off and relax, even if it’s a small treat or affordable luxury.
Secondly, millennials have come of age alongside growing concern about alarming obesity rates and the rise of healthcare costs. This means that health and wellness, and the personal responsibility for these, are much more at the forefront of their awareness. This opens up many opportunities to connect with them through holistic health and wellness propositions.
Finally, many millennials want to be collectors of experiences rather than simply accumulating possessions. They increasingly define themselves with what they do rather than what they have. Social networks give them ample chances to gain validation and status through sharing these experiences, whether it’s a special journey or an exquisite meal. Material status markers may still remain important for many millennials, especially in the developing world, however, even in these markets a post-materialist mindset is on the rise. A generation that increasingly seeks validation through experiences presents a unique opportunity for operators who are able move their imagination.
Millennial tribes
Millennial lifestyles and perspectives are as diverse as those of any other generation. To unpack some of the nuances of this group, understanding how to engage with their passions and needs, The Futures Company created a global segmentation based on two unifying millennial traits.
The first is the way they use technology in their lives. Technology is essential for the way millennials engage with the world. What sets them apart is whether they value its functional aspects or the creative connections digital technology allows.
The second dimension is the way they express their identity and the extent to which they prioritise meaning and experiences over material pursuits. Looking at millennials through these paradigms highlights four distinct tribes:
Striders
These individuals maintain their confidence and enthusiasm and are still riding the wave of materialism. They’ve been relatively unscathed by the recent economic downturn and are keen for success and all the material status markers that come along with it. Predictably, this segment is more likely to be found in fast-growing emerging markets, such as China and India.
Steppers
Consumers in this group are cautious. The economic downturn affected them strongly, leaving them price-conscious and less optimistic about their future. They’re taking things step-by-step, considering each purchase decision with care and trying to choose wisely. This tribe is much more likely to be found in recessionary markets, such as Spain and France, where many young people have seen their opportunities narrow in recent years.
Satellites
Millennials in this tribe are all about number one. They’re tech-mad and always keen to have the latest gadgets and shiniest software. Their world-view is narrow and performance-focused. Green issues simply don’t float their boat – they’re flying solo and have few responsibilities. Our segmentation shows that the Satellite tribe is important in the UK and is also well represented in China.
In China, we can explain this with the high pressure on young people to perform and strive for prosperity. This also drives a more-single minded pursuit of technologies that both facilitate and express the achievement of these priorities.
In the UK, the story behind Satellites is different. UK millennials face tough economic times in a previously flourishing economy. With a squeeze on jobs and a rising cost of living just as they’re coming of age, ‘looking out for myself’ becomes important to a greater number of people, as well as their need for getting things done faster and safer.
Spirits
Spirits are poster children of the millennial generation. They’re open, connected and socially-conscious, directing their attention and purchasing power towards the things they’re interested in. They move through different spheres comfortably and are more likely to seek out lifestyles that enable them to succeed in life while also exposing them to a variety of experiences and personal passions. This tribe is important in the Americas – in the US and Brazil in particular. It’s also significant in Europe, where the recent rise in a tempered economic optimism is likely to help the Spirit mindset come to the forefront.
How to connect
The four tribes have different needs and aspirations, highlighting that a ‘one size fits all’ approach will not be enough. There are opportunities to appeal to all four tribes and successful millennial brands have the ability to combine marketing modes that resonate with each segment in different ways.
Satellites get excited over technology and performance and will seek out services that do just that. In the fitness space, Nike has been very successful with reaching this group through its diverse performance tracking innovations from Nike+ to the Fuel Band. Operators can engage with this segment if they’re able to spark enthusiasm over new and shiny technological solutions.
On the other hand, Striders will be looking for services and experiences that enable them to express their achievements and status. Premium and luxury propositions are most likely to resonate with them, as much as experiences with a show-off factor. Nike has also connected with this segment by designing iconic and must-have items, such as some trainers in its Air Max range, and by launching these through savvy social media strategies that pique the curiosity of this exclusivity- and appearance-conscious tribe.
Just because Steppers are financially constrained, it doesn’t mean they’re out of range. Nike has been able to connect with this group in the recession by marketing some if its ranges as more durable and giving longer guarantees to reassure value-conscious Stepper shoppers. They’re unlikely to indulge in luxurious splurges but they will look for ways to disconnect from their daily pressures and anxieties and seek out much-needed boosts. Small beauty treatments such as an express manicure or day passes to spa facilities are some concrete treats they would be willing to give to themselves. Operators that show solidarity with this group, by guaranteeing value for money and access to much-appreciated small luxuries, will find a grateful audience among Steppers.
Spirits, the most connected and socially aware tribe, are the most likely to give a strong priority to seeking experiences and exploring the world around them. Operators have an opportunity to connect with them through novel and meaningful offers, including more holistic wellness treatments. They’re also the most engaged with social and environmental issues, hence sustainability-driven propositions will resonate well with them, as also seen with Nike’s numerous corporate social responsibility initiatives that build credibility among the Spirits tribe.
Mix and match
Each tribe has distinct characteristics that require different approaches to marketing and service design. Businesses that are able to mix and match their strengths to appeal to the millennial tribes will be more successful in connecting with the next generation of spa and health club audiences.
