The market is at a tipping point. Millennials are poised to become the dominant consumer segment globally, tipped to spend $200 million annually from 2017.
NB: This is a viewpoint by Eddie Robb, managing director for Make It Social.
Businesses must begin to put themselves in the high top sneakers of Generation Y in order to stay relevant and responsive. Firms which are ignorant of this growth market, unwilling or unable to tweak traditional approaches in their business, may well be left at the starting gate.
So, are you ready?
A lot has been written about so-called Millennials. So much so that Generation Y, Generation We and Generation Me, to use the imposed vernacular, are likely to become the most studied cohorts of all time, although theory is not concrete as to who exactly constitutes genuine Gen Y status. Assertions range from births between 1982 and 2004 (Strauss and Howe) to between 1980-2000 (Goldman Sachs).
Broadly speaking though, we're talking about today’s 16-35-years-olds who grew up in an era seismically defined by technology, globalisation and financial unrest.
Oddly - perhaps because I’m one myself - much of what is written in the business and marketing press on Millennials seems to have a curiously slippery grasp of this demographic, often representing it as mercurial, impulsive and hermetic.
There seems to be a cautiousness about how best to capture this unknown market, fortified with its own morals and ethics seemingly at odds with those of the corporations keen to court it.
In fact, Deloitte’s Millennial Survey 2015 revealed that 75% believed "businesses [are] focussed on their own agendas rather than helping to improve society" - a key concern for a globally- and socially-conscious youth market.
To understand how best to respond to Millennials in the travel sector, we’ve got to take a look at the formational socio-economic forces at play. On a macro level, the two main pressures on 16-to-35-year-olds have been the post-recession economy and the digital world.
These financial and social pressures have exerted an iconic influence, giving rise to the ‘extended youth phase’ or ‘emerging adulthood’ in youth theory.
Pew Research Centre has done much meaningful work in profiling this area, identifying that "millennials in adulthood" are “detached from institutions and network with friends”.
So far, so obvious.
So too is the fact that young people in this cohort entered higher education more readily and exited with more debt than prior generations.
The financial crisis of 2007/2008 gave rise to austerity, a shrinking and unstable jobs market and high youth unemployment. Many young people opted to live at home for longer and rely more heavily on the 'bank of mum and dad'.
Marriage, buying a house and starting a family - the norms of previous Generation X and Baby Boomers - were put off as a result. And of course it is Generation X and the Baby Boomers who are running the businesses trying to grasp the Gen Y baton.
It seems as if the chasm between Generation X and Y is ever-widening. Young people surrounded by technology turn to online social communities and global networks for their sense of belonging.
As we’re the first generation to grow up digitally native, change management has been hot on the lips of forward-looking businesses and marketers desperate to understand and capture a slice of this 17 million strong pie in the UK alone.
So how should this macro context inform the travel industry? Well, we've got to start considering how it influences the way consumers book their travel experiences, because it is changing.
As things stand, the theory and practice of the online booking flow has changed very little, if at all, in the twenty years or so that the internet has been around.
For sure, businesses such as HotelTonight have captured the mobile-led spontaneity required by Millennials to create a new paradigm, but examples like this are few and far between.
The online booking flow remains predominantly one-person centric, especially in the standard group booking model.
To digital natives this is anachronistic - it offers no visible insight into what your friends are up to; forces a 'group leader' to collect monies and pay for everyone else upfront or try to chase payment from friends later; it creates frustration for the group leader who has to provide the entire group’s booking information over the telephone or via a couple of isolating booking web pages.
In short, it’s a hassle, it’s boring and it’s unintuitive - of course, these groups could co-ordinate their schedules, meet up at a high street travel agent and spend an afternoon doing it manually via a 'consultant'.
But find me a millennial who's done this and I’ll eat my baseball cap.
The industry needs to rethink the booking flow and here’s a few pointers in the right direction.
Be part of the social conversation, but don’t try to control it
With the prevalence of social media and mobile devices, access to 'the group' and friends online needs to be omnipresent.
Steve Weiner, co-founder of Wharton FinTech and a Millennial himself, recently told business delegates: “We [millennials] don’t want to have a one-to-one relationship with you...we look at building trust based on what our peers tell us via social media”
By creating a social group booking space within your website where your customers can plan, book and pay together, your sales agents can support the group towards completion while maximising revenue through add-ons and extra.
At the same time the group is allowed to motivate itself, creating efficiencies for your business and offering an innovative, social experience highly desirable for this key demographic.
Create authentic relationships - connect with, don’t just collect millennials
Bauer Media, owners of brands such as Heat, KISS, Grazia and Kerrang! commissioned Bauer Knowledge: The Millennials Chapter, which revealed, "the digital world brings with it an ‘always on’ culture and fear of missing out (FOMO)".
For young people who live their lives online, transparency is key. By delivering a tool where groups can communicate socially, update one another in real time, and easily pay for shared experiences your business can actively engage these customers in a way that’s flexible, intuitive and fun.
This creates the necessary synergy with not only how they want to live their lives but how they want to transact.
Innovate: Generation We wants to live in the now and to do so creatively
The selfie obsession confirms how photography has become mainstream, literally framing our daily lives. By failing to meet the creative interests of this massive consumer group, businesses are missing out on the ability to cater to it. If your online booking flow looks the same as it did 10 years ago, it needs to capture the creative zeitgeist and be modernised.
Offer empowering experiences
In a world where digital natives are bombarded online with updates and where self-esteem is increasingly built around public opinion and the approval by committee of ‘Like’ functions, living your life online brings with it the ‘fear of missing out’ (FOMO) phenomenon.
What Bauer’s research revealed was that "experience...is the new status symbol" with 71% of the research cohort agreeing "I’d rather tell people about something I’ve done than something I’ve got".
So, by delivering a social group booking function where your customers can share and vie for their add-ons or extra experiences, you can actively optimise revenues while giving your customers the freedom to choose and build bespoke travel experiences today that they’ll be shouting about on social networks tomorrow.
Be intuitive in the online booking space
Millennials want engaging, social, fun and simple interactions online that allow them to communicate in ways already familiar to their daily lives. As Bauer Media says: "Brands must help empower this audience, allowing them to do, feel and share, if they are to remain a relevant, appreciated part of Millennials’ lives".
By speaking your customer’s language you will feel more familiar to them, more reliable and, ultimately, desirable. If you can top that with a social group booking model that feels fresh, edgy and clean, so much the better for capturing that FOMO crowd and capitalising on the viral potential of your service.
NB This is a viewpoint by Eddie Robb, managing director for MakeItSocial. It appears here as part of Tnooz's sponsored content initiative.
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