Gen Y matures into biggest financial force
Boomers take advice from their high-spending kids on cars, holidays, clothes
Generation Y has become the biggest buying force in the marketplace, filling their closets to bursting with brands and advising their parents on what cars to buy, vacations to take and even what clothes they should wear. Their parents are listening. “I think the big difference is that parents have asked this generation their opinion since they were old enough to speak,” according to Kit Yarrow, author of Gen Buy, How Tweens, Teens, and Twenty-somethings are Revolutionizing Retail.
“Parents today care more what their kids think. They consider their kids to be knowledgeable about trends.”
Yarrow addressed a breakfast meeting of retailers on Tuesday to kick off the 2012 Strategy Shopper Marketing Fo- rum in Toronto. About 400 retailers and marketers are attending the two-day conference at the Westin Harbour Castle on Queens Quay.
There has never been a shopping generation like Generation Y, according to Yarrow, a consumer psychologist and professor of psychology and marketing at Golden Gate University.
“They’re huge — a bigger demographic than Baby Boomers.
“They spend more money and they’re more enthusiastic shoppers,” Yarrow said.
According to Yarrow, as many as 80 per cent of family vehicle purchases are influenced by teenagers living at home.
Although definitions of the demographic differ, Yarrow includes people born between 1980 and 2000 as part of Generation Y — about 83 million people in the U.S.
Yarrow believes the shift in the balance of power came about in part because the traditional hierarchy within families — in which parents made most major decisions without seeking input from their children — has been flattened out by our child-centred society.
Children gained authority in the home during the 1980s and 1990s, when they essentially provided inhouse tech-support to parents baffled by VCRS. Parents have since caught up with technology, but they’re still seeking advice from their kids, says Yarrow.
Their children are, after all, shopping experts.
Boomers only had a few musthaves growing up in the 1960s and ’70s — a pair of Levi’s, a pair of Adidas, a bicycle and a Walkman.
Today’s teenagers have wardrobes of branded clothing, from matching Victoria’s Secret lingerie to designer shoes and purses. They pine for the latest in electronic gadgetry and often get it.
They are changing the retail landscape.
The generation that grew up with technology in hand is notoriously impatient, which makes them less tolerant of ambiguity, says Yarrow. Inundated with information, they are looking for curators who can whittle things down to what is relevant to them.
They are used to instant feedback, and want to be heard and acknowledged in the retail process, says Yarrow. They want honesty. They want to hear about mistakes with an apology rather than learn something has been swept under a rug.
Their brains are wired for speed, not focus. They are more easily bored, shop 24/7 and believe new is better, that innovation is cool. They like to make their own stuff, as the success of Etsy.com has shown, and even make their own stars, like Justin Bieber, who shot to fame on Youtube. Yarrow said retailers have to connect with their customers on numerous different channels, and in new ways, to generate interest and loyalty from Generation Y. As an example, she cited Purina, which gains brand awareness by funding animal welfare efforts. The conference was organized by Strategy and shopper marketing expert Pareto. The V.I.P. breakfast was organized by Shopper DDB, which provides shopping strategy advice and information to retailers.