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In this year's upfront, many advertisers will be looking to reach Millennials, a generation of consumers that is becoming an economic force.
“There is no mainstream marketer who is not targeting this group right now,” says Laura Nathanson, executive VP for ad sales at ABC Family.
In a recent research report, media agency OMD calculated that Millennials—people born between 1981 and 1995 who are now between the ages of 15 and 29—have 11% more buying power than the Baby Boomers did when they were young.
OMD figures there are 55 million Millennials. Research company Frank N. Magid Associates, which studies the generation extensively, defi nes them as those 15 to 34 years old, which raises their ranks to 86 million, based on Census Bureau figures.
By Magid’s count, they make up 27% of the total U.S. population and 52% of TV’s key adults-18-to-49 sales demographic.
While Millennials are considered the digital generation, TV remains important to them.
Among Millennials, watching television on a TV set ranked as their third favorite leisure activity, cited by 11%, according to a recent Magid Media Futures report. Their top two activites were using the Internet on a computer (23%) and console gaming (15%). By comparison, TV ranks second among Generation Xers and Boomers.
Among Millennials with cable or satellite service, 44% say they regularly watch full-length TV shows online, compared with 28% of Xers and 21% of Baby Boomers.
The leading reason why Millennials watch programs online is because they missed the episodes on TV, with 70% giving that reason, compared with 68% of Xers and 71% of Boomers. Millennials and Xers both liked online video because they could watch it at any time. But fewer Millennials say they were watching online because it was free (53%) compared with Boomers (79%) or Xers (72%). Millennials were also less likely to say they watched programs online because there were fewer and shorter ads.
“Millennials are more driven by lifestyle than cost savings,” says Sharalyn Hartwell, executive director, Magid Generational Strategies.
“A lot of our clients are interested in getting more information on this sub-segment within the population,” says Erin Bilezikjian-Johnson, associate director, custom research and insights at OMD. “Marketers have keyed into the fact that this group will be telling the Great Recession stories to their grandkids. It has very much impacted the way Millennials shop and probably will continue to do so into the future.”
OMD: TV Still Important
OMD found in its research that while Millennials are digitally oriented, they also rely on traditional media. That means that when planning media campaigns to reach Millennials, traditional media should be included.
Television is the most prevalent source for how Millennials first learn about products and services, according to OMD. TV was named by 57% of Millennials, followed by friends at 29%, family at 26%, search engines at 22% and magazines at 21%. Social network websites were named by 10% as where they first become aware of products and services; the Internet on a mobile device was also cited by 10%; and deal-of-theday websites were named by 9%.
“This supports the idea that you shouldn’t move entirely away from television for younger-skewing brands and products,” says Chris Geraci, president for national broadcast at OMD. “There’s plenty of choices within the television platform to put advertising in an entertaining environment that resonates more deeply with the younger demos.”
Millennials are “used to being bombarded with advertising wherever they turn,” and filter and manage their exposure to advertising, the OMD study found. They dislike when advertising moves into their personal space, so they use DVRs to watch their favorite shows or turn to online services like Hulu or Netflix where commercial loads are lower.
But overall, they are receptive to advertising. In OMD’s surveys, 51% say they didn’t mind seeing ads in video games, and only 22% say they would pay a subscription fee to avoid seeing ads when using the Internet on their computer (60% disagreed). And 37% of Millennials say that seeing an ad they like for a product or service they recently bought makes them feel better about their purchase.
Younger-skewing networks The CW, MTV and ABC Family aim programming at Millennials. “They are just moving into their own homes, and that group happens to be huge purchasers,” says ABC Family’s Nathanson. “Those families have the most kids in their homes. They spend more at the grocery store, they spend more at the mall.”
Marketers are trying to reach even those in the 12-to-18 age bracket “because they become good consumers for the next 20 to 30 years,” Nathanson says. “It’s not that Boomers don’t buy. They just don’t buy with the frequency and numbers that the Millennials do.”
ABC Family sells the 12-to-34 demo to clients in the movie and technology categories, but primarily still sells based on 18-to-49 year-old audiences. And marketers in all categories, even automotive and packaged goods, are seeing the rising infl uence of Millennial consumers.
“When we first started out [programming for Millennials], the phone companies were targeting 25-to-54 yearolds. Now they’re targeting 12-to-34 year-olds,” Nathanson says. “The moms may be buying the phone, but the kids are choosing which phones they buy.”
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Click here for complete coverage of the 2011 upfronts