digital marketing

Who are millennials?

Millennials are now the driving force of the increasing usage of digital media, online shopping and social media sites.  According to (Okazaki et al., 2007) digital marketing is assumed to be the most promising venue for reaching millennials. As a result, companies are using digital marketing strategies to target and better understand millennial consumer buying behaviour.

Millennials also known as Generation Y are individuals born between 1980 and 2000 (Goldmansachs, 2016). Most millennials grew up in a world filled with electronics and engaging online via social media. Due to this, millennials are keen to share their experience and opinions with consumers alike. As a result, this generation has received the most marketing attention due to their large size and buying power. It is estimated millennials spent $3.45 trillion globally in 2015 (CNBC, 2015), thus growing up making purchases and socialising online, millennials e-commerce usage is predicted to continue increasing along with their disposable income.

Targeting Millennials

Although millennials discuss products and services through social media, electronic word of mouth (eWOM definition) has become one of the most influential communication channel. Interactive technologies are enabling millennials to be pro-active when promoting and ensuring the advancement of product and brands. So what do you avoid when targeting millennials as part of your campaign? Research by (Taken Smith, K. 2017) suggests:

• Millennial consumers consider online advertising intrusive, irritating and annoying. This is due to the abundance of ads, clutter and pop ups which often causes “banner blindness”.
• Coupons are overwhelmingly the favourite mode of online advertising by millennials
• Email is amongst one of the preferred methods of marketing by millennials
• Millennials prefer websites with graphics and interactivity.

Marketing psychology practices

1. Social Proof- The tendency to see an action as more appropriate when others are doing it (Cialdini, R.B., 1987). Millennials often seek their peer’s opinion to determine if a product or service is worth purchasing as they value the opinions of their peers to be more credible. Social proof can be implemented to increase conversion and ease the mind of worried or unsure customers. A study by (Mintel, 2015) suggests 70% of online consumers look at product review before making a purchase while 57% use social media networks for recommendations. E.g., e-Commerce retailers such as Amazon have adopted social proof on its online shop by giving consumers the opportunity to rate and review items they’ve purchased.

(Amazon, 2017)

Social proof boosts consumer’s engagement and allows them reviews on products before purchase to create value. There are three types of social proof that can boost your campaign targeting millennials;

• Customers- Testimonials and case studies from existing customers.
• Celebrities- Influencers or celebrities who have purchased your product/service.
• Certification- Display certificates from an accredited 3^rd party, this suggests your business is trustworthy, high quality and knowledgeable.

2. Reciprocity- Reciprocity is concerned with offering customers value (Truong, 2012). This is a way for brands to build upon their customer relationship management. Value and loyalty from consumers makes asking for something in exchange feel acceptable to buyers. Marketers implement this principle via email list by offering discount codes or access to exclusive content in exchange for customer information. Millennials find this less annoying as they’re opting in to give their information.

(Spotify, 2017).

Spotify has adopted reciprocity well in its aims to target millennials by offering students who are currently in higher education 50% off Spotify premium simply by providing their university email address or log in via third party websites such as UNIDAYS.

Reciprocity tips that may boost engagement amongst millennials are:

• Rewards- Offer existing consumer’s discounts, free products (testers) and gift vouchers. This will be perceived as giving back to loyal customers and not another marketing trick.
• Recommendation- Existing customers can recommend their friends in exchange for points or discounts. This form of reciprocity increases E-Word of mouth generating traffic to your web store.

3. Scarcity- Millennials are likely to buy when faced with limited availability or opportunity to bargain a deal. Typically, millennial buyers act quickly when notified a special offer or product won’t last long. Millennials disprove of losing out on an opportunity and value the pleasure of getting a deal. Scarcity principle can be incorporated by marketers by using language that suggests scarcity.

Example of scarcity as used by Amazon (Amazon, 2017).

Scarcity tips that may boost engagement amongst millennials are:

• Language- Use language that highlights scarcity such as ‘don’t miss out’ or ‘limited edition’. Alternatively, consider using countdown clocks for promotions.

Criticisms of marketing psychology principles

There are various criticisms with adopting marketing psychology principles as part of a campaign. Using principles such as social proof, reciprocity and scarcity to target millennials can be perceived as exploitation. Some brands and businesses may exploit millennials due to their dominance in the online world and may use this to monetise. (Bartels, 1967) suggested there are three determinants of ethical decision making in marketing; economic implications, organisational expectations and the effects of decisions on various constituencies. Businesses should assess the impact their marketing strategies may have on its constituencies (millennial consumers). With that said, businesses/brands using digital channels to target millennials are also adding values to their consumer needs. To prevent exploitation, businesses should consider adopting a Teleological view of their marketing practices and asses the amount of good or bad embodied in the consequences of their marketing campaigns (Hunt, S.D & Vitell, S. 1986).

References

• Bartels, R. (1967). A Model for Ethics in Marketing. Journal of Marketing, 31(1), p.20.
• Cialdini, R.B., 1987. Influence (Vol. 3). Michel.

• (2017). [online] Available at: • http://www.cnbc.com/2015/08/17/how-trillion-dollar-millennials-are-spending-their-cash.html [Accessed 11 Apr. 2017].
• Goldman Sachs. (2017). Millennials Infographic. [online] Available at: http://www.goldmansachs.com/our-thinking/pages/millennials/ [Accessed 11 Apr. 2017].
• Hunt, S.D. and Vitell, S., 1986. A general theory of marketing ethics. Journal of macromarketing, 6(1), pp.5-16.
• com. (2017). 70% of Americans seek out opinions before purchasing | Mintel.com. [online] Available at: http://www.mintel.com/press-centre/social-and-lifestyle/seven-in-10-americans-seek-out-opinions-before-making-purchases [Accessed 11 Apr. 2017].
• Okazaki, S., Katsukura, A. and Nishiyama, M. (2007), “How mobile advertising works: the role of trust in improving attitudes and recall”, Journal of Advertising Research, Vol. 47 No. 2, pp. 165‐78. [Google Scholar] [CrossRef], [ISI] [Infotrieve]

• Shopify’s Ecommerce Blog – Ecommerce News, Online Store Tips & More. (2017). 6 Psychological Triggers that Win Sales and Influence Customers – Shopify. [online] Available at: https://www.shopify.co.uk/blog/8920983-6-psychological-triggers-that-win-sales-and-influence-customers [Accessed 11 Apr. 2017].
• Taken Smith, K. (2017). Longitudinal study of digital marketing strategies targeting Millennials.
• Truong, Y., Simmons, G. and Palmer, M. (2012). Reciprocal value propositions in practice: Constraints in digital markets. Industrial Marketing Management, 41(1), pp.197