Looking in the mirror every day, we don’t often notice any changes. Then we come across an old picture and time becomes evident. This is unless you have kids who are only too happy to point out the new grey hairs or wrinkles on a regular basis.
“change blindness has more to do with our cognitive abilities than optical abilities”
There is a term called Change Blindness which is a visual perception issue where individuals fail to notice changes. It is a topic that has been around since just before the turn of the twentieth century. A well-studied subject it is believed that change blindness has more to do with our cognitive abilities than optical abilities. Thus while change blindness refers to our ability to notice visual difference, it can also explain failure to recognize broader changes in our environment, such as the changing face of consumers.
It’s not a surprise to hear that Millennials and Hispanics are critical consumer groups. These are segments that marketers have been talking for years. So it is not awareness which people are change blind to, but rather it’s the maturing of these groups that is often unnoticed. And in terms of the Millennials this maturing is as literal as it is figurative.
With a population of 76 million in 2017, Millennials are the largest single consumer segment in the US and due to immigration are projected to top out around 80 million by 2020 due to immigration. Hispanics are also a large and growing segment with 60 million consumers. Accounting for one-in-four births in the US, the Hispanic population is and has been growing due to births vs. immigration.
While Baby Boomers are still important consumers, representing a larger share of total dollars the decline of their influence is already being felt. As the first of the Boomers are reaching seventy, even the youngest of the generation are now in their fifties and becoming “empty nesters”. Conversely Millennials are just getting started.
“Millennials are growing up”
In 2017 Millennials will range in age between twenty-three and thirty-seven years old. Seventy percent, 53 million Millennials will be twenty-six years old or older. This is an important age because according to the CDC the average age of a first time mothers is, twenty-six years old. Millennials are grown up. The data supports this with 47% of millennials are classified within the “Young Families” consumer segment. In addition they are also maturing from an income stand point. Their earning power has grown as 41.6% millennials are earning $70,000 or more. This is 1.5% points higher than Boomers whose incomes are starting to decline as they retire and only slightly behind Hispanics who are at 46.8%.
Crossing over multiple generations we cannot forget to address the Hispanic segment. It is important that marketers and researchers address Millennials and Hispanics together due to a significant overlap between the groups; 21% of Millennials are Hispanics and 27% of Hispanics are Millennials. The overlap continues beyond population statistics to their attitudes and consumer behaviors.
As to be expected there is a high correlation between consumer dollars and household composition, i.e. households with kids, especially teens spend more than those without. This relationship is reflected in the Hispanics and Millennials driving the growth in nine out of the top ten CPG categories, with cigarettes being the only one with boomer growth.
With the large overlapping of the two segments it should be no surprise they share many similar social and additional beliefs influencing their purchase decisions. These two groups are at the forefront of socially conscious consumption. Consideration is given to the company behind the brand and their values. They want to trust and believe in the companies they support. While many companies promote some form of social consciousness it is often not consistent and thus not seen as authentic.
Lasting success with consumers requires:
1. Stay current with your consumer insights. Change is the only constant in life. Constant success requires that brands regularly revisit their understanding of consumers.
2. Focus on and plan for tomorrow. Technology has accelerated the pace which the world moves. This includes consumers, making it critical that companies are ahead of the trend curve. Predicting the next thing requires connecting the dots across multiple data points from primary and secondary sources.
3. Be consistent and authentic. This is probably most relevant in the Hispanic segment where brands often engage and disengage with consumers. This behavior sends mix messages and erodes brand equity. Protect your brands by committing to your consumers.
“Luck is when opportunity meets preparation”
Success in business is all about luck and the definition of luck is when opportunity meets preparation. Preparation starts with knowing your market and consumers and not being change blind as they evolve. Making your own luck is about understanding where customers are heading and create the opportunity to meet them there.
Eric Talbot is the Managing Principal at Epiphany Insights, a marketing analytics consultancy helping companies increase sales and profitability by advancing the use of data and insights via evidence-based decision making. Prior to Epiphany Insights, he was VP of Strategy & Insights with Univision and is a healthcare industry veteran with nearly 20 years of consulting experience.