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The population group born between 1977 and 1996 known as Generation Y or “Millennials” is roughly 80 Million strong and represents almost 25% of the US population. Nearly equal in size to the Boomers, the segment is 50% larger than Generation X and is the most ethnically and racially diverse generation in US history.

Understanding Millennials results from study of their perceptions of Career, Technology, Communications, and the Future. Millennials stand to become more prosperous than their elders more quickly, but may be challenged in exceeding their parent’s lifestyle in an increasingly complex and global economy. They are fully immersed in their technology and live in an “always on” world communicating with friends and colleagues. Their future outlook is influenced by a well documented dose of narcissism and Morley Safer may have captured the essence when he stated “they want to rock their iPods, set their own flexible work schedule, and still be CEO by Friday”.

The dilemma for consumer facing companies is whether to pay attention to this group as a new breed of consumer, or dismiss current observations as characteristics of another maturing generation that will “grow out of it”.  Chief Marketing Officers are concerned as over 75% polled in one survey believe that the Millennial generation will have a major impact on their businesses in the next 3 years, while over 54% admit they do not have a strategy for engaging the group.

Marketers ignore the opportunities with Generation Y at great risk. Over 62% of global teens are apathetic to traditional advertising messages and 42% make purchase decisions based on the recommendations of their friends. Traditional methods to engage and retain best customers may not work with Generation Y. The Loyalty Marketing industry is just 28 years old and was launched in 1981, meaning only the oldest in the Millennial group are conversant with traditional models.

The good news for any company wishing to build brand loyalty is that the drivers of loyalty are not materially different across generations. Just about all human beings respond to a blend of tangible reward and personal recognition. The difference will be in how companies communicate their message, enable feedback, and the types of value propositions they construct.

Hanifin Loyalty has invested significant time and resource to create a methodology to develop strategic marketing plans to engage, retain, and increase business with members of Generation Y. Integral to the inventory of work is understanding the elements of a value proposition compelling to this group and their preferred methods of communication including their preferences for the growing portfolio of social media tools and networks available.

Possibly the highest priority task is to establish where marketers should set expectations for developing brand loyalty across Generation Y. Hanifin Loyalty has categorized the formula to match up with Millennials in 4 areas including Lifehacks, Community, Personalization, and Transparency. More work needs to be done documenting the “Voice of the Generation” to validate expectations of consumer marketing companies and establish whether they should set enduring brand loyalty as a key business and financial objective.

Working with our growing research panel, we hope to establish primary research from Millennials which will help to answer these additional questions and benefit leading consumer facing companies throughout the North American market.