MILLENNIALS AND BRANDS. Prepared by: QNA May, 2016
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1 MILLENNIALS AND BRANDS Prepared by: QNA May, 2016
2 CONTENTS Background and Objectives Methodology Respondent Profile Generational Characteristics Brand Values Self-Expression Through Brand Choices Brand Choice Scenarios Brand Switching
3 BACKGROUND AND OBJECTIVES QNA, 88 Brand Partners and Rockpile Strategies recently collaborated to conduct a survey of the Millennial generation in order to explore their relationships with service-related brands. The goals of this research are as follows: Understand how differ from Generation X and Explore the truth behind stereotypes and common wisdom about Validate core values when it comes to brand relationships Explore how engage with intangible brands, particularly financial and healthcare brands and others in the service industry Develop strategic insights to help service-related marketers position their brands to make a deeper connection with This report summarizes all data points from the research for the three generations being compared:, Generation X and. 3
4 METHODOLOGY Data was collected from 1,490 consumers in February 2016 via a online survey. Respondents were identified using a national panel of consumers. The survey consisted of 33 questions. Major topics addressed in the survey include the following: Lifestyle factors Employment and economic profiling information Attitudes toward societal institutions Brand evaluation and differentiation Generational traits and characteristics Demographics 4
5 RESPONDENT PROFILE 5
6 SAMPLE DISTRIBUTION A total of 1,218 valid and complete surveys were collected. Quotas were set in order to obtain representation from the generational groups shown below. A total of 791 participated in the study. Generational Segment Completed Surveys Margin of Error Younger (born ) 380 +/- 4.4% Older (born ) 411 +/- 4.1% Generation X (born ) 222 +/- 6.6% (born ) 205 +/- 6.8% TOTAL /- 2.5% 6
7 DEMOGRAPHIC PROFILE A slight majority of respondents in each generation identify as female. MILLENNIALS GENERATION X BABY BOOMERS Female, 58% Male, 42% Female, 62% Male, 38% Female, 57% Male, 43% Q12 Do you identify your gender as? 7
8 DEMOGRAPHIC PROFILE A majority of respondents across all the generations describe their ethnicity as Caucasian. include significantly more non-caucasian respondents. ETHNICITY 100% 80% 60% 80% 76% 91% Generation X 40% 20% 0% 8% 7% 5% 14% 10% Caucasian African-American Asian Native Hawaiian/API 2% 4% 1% 1% 2% 3% 1% 2% 2% 1% Native American/Alaskan Other Q4 Which of the following ethnic groups do you identify with? 8
9 DEMOGRAPHIC PROFILE More than one in ten report that they have Hispanic or Latino heritage, a significantly greater distribution than among, but similar to Generation X. HISPANIC OR LATINO HERITAGE 40% 20% 12% 11% 3% 0% Generation X Q3. Are you of Latino or Hispanic Heritage? 9
10 EDUCATIONAL PROFILE Despite their younger age, the educational profile of does not differ dramatically from Generation X or. Overall, 48% of have completed at least a college degree, compared to 54% of Generation X and 47% of. EDUCATION 40% Generation X 31% 29% 23% 24% 26% 20% 15% 14% 12% 19% 10% 14% 14% 16% 19% 19% 4% 2% 2% 4% 4% 2% 0% Some high school High school Some college Associate's Degree 4-year college degree Some postgraduate Graduate or professional degree Q5 What is the highest level of education you ve completed? 10
11 EDUCATIONAL PROFILE About one in three (32%) are currently in school pursuing some type of degree or certificate. Of these, a majority (73%) are attending school full-time. CURRENTLY PURSUING DEGREE/CERTIFICATE MILLENNIALS IN SCHOOL 40% 32% Part-time, 27% 20% 14% 0% Generation X 4% Full-time, 73% Q6 Are you currently in school pursuing some type of degree or certificate? Q7 Are you going to school full time or part time? 11
12 EMPLOYMENT AND FINANCIAL PROFILE Almost three-quarters of (70%) report that they are currently employed. Of these, most are working full time (at least 35 hours per week). About one in four are working less than full time on average. CURRENTLY EMPLOYED MILLENNIAL EMPLOYMENT 100% 80% 70% 77% hours/week, 13% Less than 25 hours/week, 11% 60% 53% 40% More than 40 hours/week, 34% 20% 0% Generation X hours/week, 42% Q8 Are you currently employed? Q9 Approximately how many hours do you work in a typical week? 12
13 EMPLOYMENT AND FINANCIAL PROFILE Among those who are employed, a majority in each generation report having one full-time job. Just 9% of report having multiple jobs. 100% TYPE OF EMPLOYMENT 80% 69% 81% 67% Generation X 60% 40% 20% 0% 23% 23% 12% 5% 5% 5% 4% 6% 2% One full-time job One part-time job Two or more part-time jobs Full-time and part-time jobs Q10 Which of the following best describes your current employment situation? (Base: currently employed) 13
14 EMPLOYMENT AND FINANCIAL PROFILE Although are most apt to report that they are self-employed, a surprising number of working (13%) say they are self-employed in one or more of their jobs. SELF-EMPLOYED 40% 23% 20% 13% 14% 0% Generation X Q11 Are you self-employed in one or more of your jobs? (Base: currently employed) 14
15 EMPLOYMENT AND FINANCIAL PROFILE As would be expected, older generations report higher income levels. However, one in four in this study report relatively high incomes over $100,000. INCOME 0% 20% 40% 60% 80% 100% 3% 8% 14% 19% 15% 15% 15% Generation X 6% 14% 15% 21% 12% 6% 10% 8% 13% 18% 18% 13% 8% 6% $200K or more $150K-$199K $100K-$149K $75K-$99K $50K-$74K $35K-$49K Less than $35K Q29 Is your total pre-tax household income between the ranges of? 15
16 EMPLOYMENT AND FINANCIAL PROFILE Compared to older generations, are more apt to believe that they are better off financially today than they were a year ago. Almost half (46%) agree with this optimistic perspective, compared to just 22% of. FINANCIAL CIRCUMSTANCES 0% 20% 40% 60% 80% 100% 46% 37% 17% Generation X 39% 39% 22% 22% 57% 22% Better off than one year ago About the same financially Worse off than one year ago Q31 How are your financial circumstances compared to one year ago? 16
17 EMPLOYMENT AND FINANCIAL PROFILE Across all three generations, respondents are most apt to say that they grew up in a middle class household. However, a slightly larger share of say their upbringing was at or above middle class, compared to Boomers. CHILDHOOD FINANCIAL CIRCUMSTANCES 0% 20% 40% 60% 80% 100% 2% 17% 49% 22% 9% Generation X 1% 16% 52% 25% 5% 2% 15% 48% 27% 9% Affluent Upper middle class Middle class Lower middle class Lower income Q32 Thinking about the environment you grew up in, would you say it was 17
18 LIFESTYLE are most likely to be renting a home or apartment (46%) at this stage of their lives. More than one in four (29%) reports that they are living with a parent or other relative. Just 24% currently own their own home or condo. LIVING ARRANGEMENTS 0% 20% 40% 60% 80% 100% 29% 23% 23% 24% Generation X 8% 20% 7% 64% 2% 8% 5% 85% Live with parents or other relative Rent and live with roommates Rent and live on own/with spouse/child Own home or condo Q14 Which of the following best describes your current living arrangements? 18
19 LIFESTYLE are significantly more apt to report living in urban settings (36%), compared to older generations, who skew suburban. 100% COMMUNITY SETTING 80% Generation X 60% 49% 58% 55% 40% 36% 25% 27% 20% 18% 15% 18% 0% Urban Suburban Rural Q13 Which of the following best describes the area where you live? 19
20 LIFESTYLE The majority of report that they are single and never married (66%). Only about a third of (32%) are currently married. MARITAL STATUS 0% 20% 40% 60% 80% 100% 66% 32% 0% 1% 0% Generation X 20% 69% 1% 9% 1% 10% 74% 3% 13% 1% Single, never married Married or domestic partnership Widowed Divorced Separated Q15 What is your marital status? 20
21 LIFESTYLE One in four (25%) report that they have children. Of these, nearly all say their children are living with them. 100% 80% HAVE CHILDREN 71% 77% MILLENNIALS WITH CHILDREN IN HOUSEHOLD 60% 40% 20% 25% No, 1% 0% Generation X Yes, 99% Q17 Do you have any children? Q18 Do your children live with you at least some of the time? 21
22 LIFESTYLE Across all three generations, the largest share tend to identify as middle of the road on the political spectrum. are less than half as likely than Generation X or to self-identify as strongly conservative. 100% POLITICAL VIEWPOINT 80% 60% Generation X 40% 41% 41% 34% 20% 14% 9% 9% 24% 19% 22% 15% 19% 22% 6% 13% 14% 0% Strongly liberal Somewhat liberal Middle of the road Somewhat conservative Strongly conservative Q30 Which of the following best describes your political viewpoint? 22
23 GENERATIONAL CHARACTERISTICS 23
24 GENERATIONAL CHARACTERISTICS Respondents were presented with a list of personality traits and asked to select those that best represent them personally. A majority of self-selected the traits shown below, with hard working and realistic being the most popular traits overall. PERSONAL CHARACTERISTICS (selected by a majority of ) (%) Generation X (%) (%) Realistic Hard-working Open-minded Fun Real, not fake Adaptable Creative Multitasking Q22/24 Please review the list and select the traits that you feel represent who you are as a person. 24
25 GENERATIONAL CHARACTERISTICS Although not selected by a majority, the traits listed below are fairly common among and were selected by at least one in three members of that generation. PERSONAL CHARACTERISTICS (selected by 30%-50% of ) (%) Generation X (%) (%) Ethical Trusting Socially aware Authentic Cautious Sarcastic Successful Optimistic Modern Ambitious Adventurous Social Career-minded Tech savvy Savvy Wellness-oriented Environmentally-conscious Q22/24 Please review the list and select the traits that you feel represent who you are as a person. 25
26 GENERATIONAL CHARACTERISTICS Only about a quarter to a fifth of identify with traits below. For some particularly charitable and patriotic it is notable that members of older generations identify much more strongly with them. PERSONAL CHARACTERISTICS (selected by 20%-29% of ) (%) Generation X (%) (%) Spiritual Charitable Patriotic Innovative Humanistic Simplified Nostalgic Collaborative Religious Risk-taker Diverse Cynical Q22/24 Please review the list and select the traits that you feel represent who you are as a person. 26
27 GENERATIONAL CHARACTERISTICS Relatively few respondents in any of the three generations self-identify with the traits below, which tend to be more self-centered. PERSONAL CHARACTERISTICS (selected by less than 20% of ) (%) Generation X (%) (%) Rebellious Entitled Entrepreneurial Wealth-oriented Spoiled Hip Self-centered Glamorous Early adopter Status-seeking Unplugged Arrogant Q22/24 Please review the list and select the traits that you feel represent who you are as a person. 27
28 ATTITUDES TOWARD SOCIETAL INSTITUTIONS Significant differences were observed across generations when it comes to attitudes toward societal institutions like advertising, the business world, government, and religion. differ most substantially from older generations when it comes to their desire to be connected via social media. (mean rating) Generation X (mean rating) (mean rating) I have a lot of confidence in my ability to evaluate the quality and accuracy of information I find online or through my social network Advertising is a good way to learn about new products and services I prefer to contact a real live person (face to face or over the phone) instead of using social media/ when dealing with a company whose products/services I use Advertising is usually deceptive and doesn t tell the truth The strength of the country is mostly based on the success of American business. When something is run by the government, it is usually inefficient and wasteful. Corporations promote people up through the management ranks based primarily on merit and competence When people have strong religious beliefs, it improves society as a whole When I am not connected via social media, I feel like I am missing out on things Q23 Please rate your level of agreement with the following statements Ratings in green are significantly different from Generation X, Boomers, or both. 28
29 BRAND VALUES 29
30 BRAND VALUES When presented with a series of characteristics that brands might possess, are like older generations in identifying best quality as most important in helping generate a sense of loyalty and commitment to a brand. Brands that are forthcoming about problems that come up are also highly valued. Most Important Brand Characteristics Offers the very best quality Is forthcoming about problems Conveys authenticity in what it says and does Offers the lowest prices or rates Willing to change their product or service based on consumer opinion Generation X Q25 Please rate how important each item is in helping you feel a sense of loyalty and commitment to that brand. (1-10 rating) 30
31 BRAND VALUES Characteristics that are moderately important include reward programs, convenience, fair labor practices, and creativity. Moderately Important Brand Characteristics Provides a service experience customized to my lifestyle Available to me 24/ Engages in fair trade and labor practices Creative when it comes to offering new products and services Offers customer reward program Generation X Q25 Please rate how important each item is in helping you feel a sense of loyalty and commitment to that brand. (1-10 rating) 31
32 BRAND VALUES Characteristics that are least important across all generations include charitable giving, advertising, and heritage. The importance of reaching out via social media ranks lowest, but are significantly more apt to value this feature. Least Important Brand Characteristics Engages in charitable activities using business expertise Advertises about what makes their products unique/relevant Has a long history and heritage Reaches out to/interacts with customers via social media Generation X Q25 Please rate how important each item is in helping you feel a sense of loyalty and commitment to that brand. (1-10 rating) 32
33 BRAND VALUES Across all respondents, brands are said to be most apt to deliver on two factors that rank fairly low in importance advertising and social media. In contrast, one of the most important factors being forthcoming about problems is viewed as a fairly rare characteristic. BRAND PERFORMANCE 0% 20% 40% 60% 80% 100% Advertises about what makes their products unique/relevant 19% 47% 31% 4% Reaches out to/interacts with customers via social media 12% 44% 36% 8% Available to me 24/7 10% 36% 42% 12% Offers the very best quality 8% 34% 48% 10% Creative when it comes to offering new products and services 8% 39% 47% 7% Offers customer reward program 8% 39% 43% 10% Environmentally friendly and sustainable 6% 25% 53% 16% Is forthcoming about problems 6% 24% 48% 21% Has a long history and heritage 7% 35% 50% 8% Offers lowest prices or rates 7% 24% 58% 11% Engages in fair trade and labor practices 7% 28% 49% 16% Conveys authenticity in what it says and does 6% 29% 51% 14% Provides a service experience customized to my lifestyle 7% 31% 51% 12% Engages in charitable activities using business expertise to 6% 27% 52% 15% Changes products/services based on customer opinion 5% 26% 54% 15% Most A Lot Some Few Q26 Please tell us whether you feel that is something that describes most brands, describes some brands, or only describes very few brands. 33
34 SELF EXPRESSION THROUGH BRAND CHOICES 34
35 SELF EXPRESSION THROUGH BRAND CHOICES Compared to older generations, are significantly more apt to believe that the brands they choose are a reflection of themselves. The brands I choose to use say something about who I am and the image I project about myself to other people 0% 20% 40% 60% 80% 100% 46% 38% 16% Generation X 42% 36% 23% 29% 39% 32% Agree (4-5 rating) Neutral (3 rating) Disagree (1-2 rating) Q27 Thinking about the brands you choose to use, please rate your level of agreement with the following statements. 35
36 SELF EXPRESSION THROUGH BRAND CHOICES and Generation X are significantly more likely to believe that they help to educate others about brands, compared to Boomers. People seek me out for my knowledge and opinions about brands 0% 20% 40% 60% 80% 100% 41% 35% 23% Generation X 42% 32% 26% 23% 33% 44% Agree (4-5 rating) Neutral (3 rating) Disagree (1-2 rating) Q27 Thinking about the brands you choose to use, please rate your level of agreement with the following statements. 36
37 SELF EXPRESSION THROUGH BRAND CHOICES and Generation X are similar in their willingness to express their options about brands online, while Boomers are less apt to do so. I am willing to share my thoughts and opinions about brands I use over social media or online. 0% 20% 40% 60% 80% 100% 49% 31% 20% Generation X 49% 28% 23% 33% 23% 44% Agree (4-5 rating) Neutral (3 rating) Disagree (1-2 rating) Q27 Thinking about the brands you choose to use, please rate your level of agreement with the following statements. 37
38 SELF EXPRESSION THROUGH BRAND CHOICES express the most interest in supporting socially responsible companies. I try to support companies that are socially responsible with the products and services I choose to use. 0% 20% 40% 60% 80% 100% 55% 34% 12% Generation X 49% 34% 17% 44% 38% 18% Agree (4-5 rating) Neutral (3 rating) Disagree (1-2 rating) Q27 Thinking about the brands you choose to use, please rate your level of agreement with the following statements. 38
39 BRAND CHOICE SCENARIOS 39
40 BRAND CHOICE SCENARIOS In order to understand how members of each generation make decisions about brands within selected service-related categories, respondents were presented with a series of three choice scenarios. For each scenario, they were asked to choose which combination of features they were most likely to choose in a real-life setting. Respondents were then given the opportunity to explain why they chose each option. The scenarios presented varied from one another in their offerings, delivery channels (e.g. online vs. inperson), price points, and additional features. For example, some provide charitable benefits to demonstrate corporate citizenship. Respondents were asked to make choices that essentially require them to make trade-offs among desirable benefits. 40
41 BRAND CHOICE SCENARIOS When making a choice about eyeglasses, all three generations tend to prefer Option B. When asked to explain their choices, respondents note the personalized service and a desire to support local businesses. Respondents who chose Option C frequently cite low prices as a primary motivator. Scenario 1: Eyeglasses Option A Option B Option C Online retailer Online tools to allow you to see how the glasses look on you and to make sure you are measured correctly Largest selection of styles available anywhere Free shipping and returns/replacements 1 pair of eyeglasses donated for a person in need for every pair sold 24% Gen X 20% Boomers 7% Locally owned and operated eyeglass shop in your neighborhood Personalized service and attention Fitting and measurements done by technicians with more than 20 years experience 46% Gen X 41% Boomers 50% National chain of optical shops Locations throughout your area and across the country Regular promotions offered, such as buy one pair and get one half off 31% Gen X 40% Boomers 42% 41
42 BRAND CHOICE SCENARIOS When choosing a credit card, having no annual fee is of primary concern for many respondents, driving preference for Option A across the generations. Higher cash back rates are also cited as being important. are significantly more apt to say that earning Amazon points is a particularly appealing component of Option A. Scenario 2: Credit Card Option A Option B Option C 19.75% interest rate 1.5 % cash back on purchases No annual fee Award winning member points program that you can use to purchase items on Amazon Mobile app that allows you to monitor your account at any time 68% Gen X 69% Boomers 73% 18.75% interest rate 1 % cash back on purchases $50 annual fee Financial literacy program to educate low income people about how to manage their debt and credit cards wisely 10% Gen X 9% Boomers 4% 18.75% interest rate 1.5% cash back on purchases $50 annual fee For every dollar spent, 10 points are added to your hotel rewards account 21% Gen X 22% Boomers 22% 42
43 BRAND CHOICE SCENARIOS Respondents are more divided in their health insurance plan choices, with the overall premium cost being the most important factor, followed by having an in-network doctor. Although not a primary driving factor in their choices, both and Generation X express greater interest in discounts and helping underserved communities, compared to Boomers. Baby Boomers are significantly more apt to value having their current doctors in-network. Scenario 3: Health Insurance Plan Option A Option B Option C Includes nearly all the doctors and hospitals in the area, including your doctor Includes only some of the doctors and hospitals in the area, but your doctor is in network Includes only some of the doctors and hospitals in the area and your doctor is not in network $350 per month premium $275 per month premium $235 per month premium Discounts on eyeglasses and fitness club memberships Discounts on eyeglasses and fitness club memberships Funds health screening and education programs in underserved communities to to help people stop smoking and prevent diabetes and child obesity 35% 38% 27% Gen X 37% Gen X 37% Gen X 26% Boomers 31% Boomers 47% Boomers 22% 43
44 BRAND SWITCHING 44
45 BRAND SWITCHING When presented with a variety of factors that might cause someone to switch brands, are most apt to choose financial considerations, such as changes in their own finances or cost increases imposed by the brand. Most Important Factors Driving Brand Changes (Ranked First by ) Changes in financial situation 27% Price or rate increase 27% Newer product on market 12% Learning about product that is more eco-friendly or socially resp. 8% Recommendation by family member 8% Learning that current brand engages in unfair business practices 6% Changes in family or relationship status 4% Recommendation by friend or social media contact 4% Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 45
46 BRAND SWITCHING Price increases are an important driving factor for brand switching across all three generations but and Generation X are significantly less apt to say it is their most important reason. Price or Rate Increase % 17% 19% Generation X 30% 23% 15% 39% 24% 21% First choice Second choice Third choice Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 46
47 BRAND SWITCHING Compared to, and Generation X are significantly more apt to cite changes in their financial situation as a key driving factor in brand switching. Changes in my financial situation % 15% 15% Generation X 28% 19% 12% 20% 17% 19% First choice Second choice Third choice Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 47
48 BRAND SWITCHING Finding a newer product on the market is an appealing reason to change brands across all generations. Newer Product on the Market % 16% 17% Generation X 13% 14% 21% 15% 15% 16% First choice Second choice Third choice Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 48
49 BRAND SWITCHING Recommendations from family members are fairly important to all three generations. Recommendation from a Family Member % 14% 12% Generation X 8% 12% 16% 6% 13% 14% First choice Second choice Third choice Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 49
50 BRAND SWITCHING Compared to older generations, are significantly more likely to say they would make a change if they learned about a product that is more environmentally or socially responsible than their current brand. Learning about a Product that is More Eco-Friendly or Socially Responsible % 12% 7% Generation X 4% 10% 7% 4% 11% 8% First choice Second choice Third choice Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 50
51 BRAND SWITCHING are directionally more apt to say that they would switch away from a brand that engages in unfair business practices. Learning that my Current Brand Engages in Unfair Business Practices % 10% 10% Generation X 6% 10% 14% 11% 12% 8% First choice Second choice Third choice Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 51
52 BRAND SWITCHING Changes in their family or relationship status are more likely to impact brand switching among, though this factor still rates well below other influencers. Changes in my family or relationship status % 7% 7% Generation X 3% 5% 7% 2% 4% 5% First choice Second choice Third choice Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 52
53 BRAND SWITCHING Recommendations from friends or social media contacts are significantly more influential among and Generation X, but they still retain relatively little influence compared to other factors. Recommendation from a Friend or Social Media Contact % 7% 10% Generation X 5% 6% 5% 2% 1% 6% First choice Second choice Third choice Q28 People may change the brands they choose for a number of reasons. What causes you to change brands? Please rank the top three reasons from the list below. 53
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