Why Target Hits the Bullesye: Cheap but still Chic

While we are on the subject of retail appeal for Millennials, there is no question that Target is still number one with the right combination of low prices and style. Target has done a great job of staying in the zone of what Millennials value:

Social responsibility: Target donates millions of dollars each year to local schools. Target also sponsors learning opportunities and internships at unversities and colleges, including my marketing classes at University of Notre Dame.

Stylish advertising: Judy Hopelain, who blogs about retail at Retail Hits and Misses, tells me Target is a hit with her 17-year old daughter. They both enjoy this Target spot, running on the Olympics. "It’s got the multi-culti thing going for it, great music, no boring talking heads reading lame copy written by some old guy, and fun bedroom decor you can actually imagine these kids choosing for their rooms."

Sexy in-store experience: My 17-year daughter's disdain for Wal-Mart lighting, layout, and listless looking employees is apparent each time we shop there (which is too often for her. In contrast, she feels fine shopping at Target.

Super Deals: David Patrick, our fabulous client at Westlake Ace Hardware, reports "My 17 year old daughter is price conscious and takes pride in finding deals. Target is her favorite store"

Given those attributes, it doesn't matter that most Target merchandise can be found elsewhere -- like Wal-Mart -- and sometimes for less. Evidence? Target's sales grew 5.7 percent to $15 billion in 2Q, while sales declined at JC Penney, which like Target derives much of its revenue from clothing and home goods rather than groceries. Demographic profiles of Target shoppers show they skew younger and higher income. BIGresearch(8.19.08) shows Target and Macy's shoppers favor Obama, while Wal-mart and Kohl's shoppers skew toward McCain, a finding totally consistent with the demographic profile. This profile should serve Target well as Millennials graduate, start families, and furnish homes. Our bet is that they will keep Millennials' enthusiasm well beyond their 20's. Target is Pepsi to Wal-Mart's Coke -- The Choice of a New Generation.

Millennials: I'm Gonna Be A Star!

Celebrities have a special appeal to Millennials. Many Millennials aspire to be famous themselves -- and being famous actually seems within their reach -- so they pay special attention to those who are already famous. We have noted before how many tween TV shows now feature ordinary kids with celebrity careers, thereby 'normalizing' the experience. Furthermore, Millennials have been told from a young age they can be anything they want to be. USA Today, in a Jan 2007 article, titled "Generation Y's goal? Wealth and fame" observes that half of Millennials expect to become rich, and many expect to become famous in their field, though not as famous as Jessica and Nick. They attribute this to being raised with a camera pointed at them and now the ability to put themselves on the Internet. A 24-year old woman who aspires to being a college professor summarizes Millennials motives neatly: "Fame doesn't necessarily mean being on TV. I personally hope to become an influential figure and to be a prominent researcher in my field...it's famous, but it's much less than stardom. I want to affect society."

Several retailers, including Macy's and Wal-Mart, have leveraged this preoccupation nicely. Wal-Mart cleverly leverages Hannah Montana's superstardom in its current back-to-school commercial with a repeated musical refrain 'want to be rock star' to which the Hannah-wanna-be replies "Bring it on!" The message? 'I've become and star and so can you!'

Pauline Hwa, a former Notre Dame MBA student of mine, who is now helping ogplanet.com market video games, says she and her friends enjoy Macy's celebrity-filled commercials featuring Mariah Carey, Gabriel Aubrey, Carlos Santana, Donald Trump, Martha Stewart, Kenneth Cole, Jessica Simpson and more.

When I asked my friends, the best response I got was for the recent Macy's commercials... the Macy's commercial was very appealing for her and her friends. What made the Macy's commercials resonate with them is not just that (it had celebrities). One person said while she's not a fan of the celebrities featured in the commercials, she knows who each of them are, and she was surprised that they all had products in Macy's stores, which she didn't know about since she doesn't shop there typically. I have seen the commercial she was talking about, and I somewhat agree with her about its success.

Millennial Target: Zipcar

Zipcar may be the ultimate Millennial brand. Green. Cool. Affordable. Here's what Marty Predd, 20-something Millennial, says about his Zipcar experience:

CP: Why do you like Zipcar?

MP:ZipCar is a concept (and a brand - tagline, "Wheels When You Want Them") that is very appealing to me and seems to fit well into the stereotypical millennial experience - on the go, desiring to be always connected, but not 'attached', and of course, 'green'. Within a matter of 15 minutes, I can literally locate and reserve anything from a MiniCooper to a minivan, all for $10/hr or less. Gas and insurance are included, so it offers the full functionality of a car without the strings of ownership. Also available by the day with rates that are competitive with your traditional car rental companies, which I associate with boring rentals like a Ford Taurus (do they even make that any more?) They recently merged with the other major car sharing service (Flexcar) so they've got a good representation in the major markets, and even some not-so-major ones...meaning it's as easy for a milliennial on the move to reserve a car in his base city (i.e. Portland) as it is to reserve one when he's visiting friends in Chicago or LA.

CP: Beyond functionality, what makes Zipcars cool?

MP: Zipcars tend to be young, fun and functional - Mazdas, Subarus, Honda hybrids, even Scion (another millennial targeted brand) - and integrate technology in the kind of seamless way millennials have come to love in companies like Apple. Each member has his/her own Zipcar card and after reserving your car (on your iPhone, naturally) you simply swipe your card to a GPS-enabled receiver on the front windshield and the vehicle unlocks.

CP: Are there any downsides?

MP: The only downsides are that you have to book the car for a set number of hours in advance (doesn't lend itself to impromptu decision making) and the vehicles have to be returned to the same parking spot from which you picked them up - no one way road trips!

Appealing to Millennials: Cool, Authentic -- or Dorky?

According to Outlaw Consulting's brand report, some brands, like Converse’s Chuck Taylor shoes, are cool because they’re grounded in the past. Others, like Apple and Nike are cool for the opposite reason: they embody change and constantly reach towards the future. But there is a third category of cool brands, those that appeal to Millennials' inner nerd. Pop culture has celebrated the nerd/geek culture for many years (Napoleon Dynamite, Jimmy Neutron, Sand Lot). Millennials are not afraid to admit to a dorky side and they admire brands that can do the same. According to Outlaw, Trader Joe's, Jet Blue and In N Out Burger have won the love of Millennial trendsetters simply by being their quirky selves, doing things they own way and never apologizing: “(Trader Joe's employees) wear these tacky Hawaiian shirts and publish that ridiculous newsletter. But it’s their own style. And it’s so much more inviting than the normal rigid grocery store.”

Given Millennials' soft spot for the nerdy, it shouldn't be a surprise that Microsoft is enlisting the ultimate nerd's nerd, Bill Gates, to turn around its battered image. Bill Gates appealing? Well, for starters check out the adorable video, "Bill's Last Day", from January's CES. Self-deprecating sense of humor was clearly on display (along with some pretty cool cameos by Millennial darlings Al Gore, Barack Obama, Jon Stewart, George Clooney, and more).

According to today's Wall Street Journal, Microsoft is now launching a new $300 million campaign (that's big) that will feature Gates and Jerry Seinfeld. The campaign theme is said to be "Windows, not Walls", stressing the need to break down the barrier that prevent people and ideas from connecting. Now there's an idea designed to win Millennials' hearts! The campaign is said to break Sept 4. We'll be watching to see if Mic Guy can compete with the charms of Mac Guy among Gen Y.

Millennials: Just Be-Cause

One of the most cherished Millennial values is 'making a difference'. This makes cause marketing a natural choice for many Millennial marketers. Tom's Shoes has leveraged both cause marketing and community-building so naturally, it looks effortless. In case you missed it in an earlier post, Tom's promises to donate a pair of shoes to a child in need somewhere in the world for every pair of shoes it sell. Talk about effortless, it's consumerism as altruism. Hey we all need shoes, right? The shoes are well-made and there are endless variations on the basic design. The Toms web site invites you to 'get involved' by joining a 'shoe drop' or simply joining the mailing list. In between these two options is a smart take on community-building / viral marketing / customization (yes, all three in one) called 'Style Your Sole'.

Style Your Sole...is a great time for you and your friends to get together, express yourself through your own designs and support a good cause. Whether it is the theme of your party or a community building activity, you and your friends are putting shoes on children’s feet somewhere around the world. Wear your originally designed TOMS and tell the story!

To see what looks like the coolest Tom' Shoe party ever, just watch the video. How do I get to a party like that?!

In contrast, the wecansolveit.org site makes it hard to 'make a difference', other than by donating money. I have seen the splashy (but vague) commercials and print ads (full spread in the latest Fast Company) and wondered what it was all about. I am still wondering. It takes a lot of effort to figure out what you can do to support 'solving the climate crisis' (do they mean global warming?). And there is precious little to engage my attention. I clicked through to the Facebook application, which seems to be all about getting my friends to join. Oh, and I can earn points that cause someone else to donate money. Interestingly, the top points earners seem to be pretty low. I already have 112 points for joining and other than the top three, no one has gathered more than 500 points. Mmmm, Tom's, I prefer to Style My Soul with you. I'd bet your viral efforts will do more to attract Millennials than Wecansolveit's flashy ads. For another take on Toms and social responsibility, see the Retail Hits & Misses Blog

Millennials Get This Message: Beware of Debt

Marketing a cause to Millennials should be easy, especially when the cause is anti-marketing. Millennials are a prime target for financial services, but often see credit as 'free money'.... until they find themselves suddenly in debt. Truthout, in a blog post titled: Millennials: Debt Becomes You, informs us college students are more heavily in debt than ever.

The Federal Reserve says graduates now shoulder three times more debt than a decade ago, after adjusting for inflation. Undergraduates now average almost $20,000 in debt, with a quarter taking on more than $25,000, according to Robert Shireman, director of the Project on Student Debt, a Berkeley-based think tank.

The issue goes well beyond educational debt, however. College students graduate with $4,000 of credit card debt, on average, according to the U.S. PIRG Education Fund. The PIRG's FAll 2007 campaign, 'Truth about credit' shows a solid understanding of how to reach and motivate Millennials, and is worth a closer look. It starts with a web site, www.thetruthaboutcredit.com that explains the pitfalls of credit card debt and the marketing techniques used by credit card companies to lure new customers. PIRG goes further by sending out peer marketing teams to get students to sign petitions about marketing practices on campuses. The teams will look and act like a regular credit card company, working for a fictional company called "Feesa" (tagline: "Free stuff now. Huge debt later") and handing out lollipops saying, "Don't be a sucker." Volunteers fanned out across 34 universities last October, distributing information and collecting petition signatures to persuade colleges to establish specific "principles" regarding credit card marketing on campus. The principles include prohibiting the use of gifts in marketing on campus and blocking the sale of student lists. The volunteers wear blue Feesa shirts that are designed to look and sound like a real credit company (sounds like VISA).

Facecard (love the name) uses similar techniques to promote its pre-paid debit card. Facecard marketing teams will distribute informational packets on 50 college campuses around the country. The brochure, titled "Get smart. Get more," provides tips on budgeting, banking and preventing identity theft. Mobilizing Millennials to educate other Millennials and enroll them in the cause sounds like smart marketing to me.

Dorm Decor? Who Knew?

As a middle age, middle of the pack Boomer, there are few categories that I have left untouched as a consumer. Yet as the parent of a college bound freshman, I find myself in the middle of a marketing bullseye that is entirely new to me. Needless to say, 'in my day', we hardly thought of the stuff we brought to college as 'decor', and an electric typewriter was the limit of our college 'technology'. According to the 8th annual College Explorer study from Alloy Media, the students reporting to campus in droves this week are the largest class in history, with 13.6 million college students (ages 18-30). They are also among the best equipped, with spending expected to reach a record $237 billion, up 20% since LAST YEAR! With that much money on the table, no wonder it feels like a feeding frenzy for marketers. The photo is from Better Homes & Gardens which offers designer Q&A on dorm decor. Here's sample:

Simple tricks like "removable wallpaper" can easily add a splash of color to whole dorm room or on even just one wall. Also, using tension rods or simple hooks to suspend drape panels on the walls can add some visual interest to a boring room. Draped panels even allow students to divide a shared space to give each roommate more privacy.

At a more practical level, several retail web sites (JCP.com, Bed Bath & Beyond) offer special college microsites that make it easy to find bedding for those extra-long dorm beds and will even ship directly to the dorm to arrive at just the right time. These sites do more than offer stuff, they also offer checklists and advice on how to achieve the 'suite life' in a dorm. JCP.com incorporates its advice into a Facebook group and allows members to commment. Unfortunately, most of the comments are not terribly flattering. Apparently, (shock) many students see through these helpful sites to the not so veiled motivation to sell more stuff. As Melissa Massey puts it: "I am sick and tired of seeing "Dorm Life" advertised everywhere. What did kids do before all this dorm shit was made? They made it through college just fine. I'm tired of it being advertised as a lifestyle and a decorating style."