Gen Y/Millennials strategic brief

1. PROJECT
Given Nissan’s current product line-up and limited marketing budgets, how should
Nissan target Millennials?
OBJECTIVE
Nissan needs to move Millennials from unawareness of the Nissan brand and their
models to awareness, to comprehension, to conviction, then to the buying action. Bottom
line: change brand perceptions of tomorrow’s buyers so Nissan is in their consideration
set.
METHODOLOGY
In order to accomplish this task, I want to understand this generation. In addition to their
demographics, I want to know the psychographics, lifestyles, purchase behaviors,
economic, political and cultural issues that have shaped their lives.
There are three paths I would use to find this information; a) Allison-Fisher and Strategic
Vision databank, b) Secondary research through the Internet, periodicals and books and
c) Conducting focus groups. For the purpose of this project, I will focus my insights only
from secondary research.
Currently, this generation is going through a naming crisis. There are approximately
sixteen different descriptions for this generation (i.e. Millennials, Generation Y, Echo
Boom, Digital Generation, etc.) and not one has really taken over. However, for the
purpose of this project, I will address this generation as Millennials.
SYNOPIS
Demographics
The consensus is that Millennials were born from 1982–1994. The oldest Millennial is
24-years old and the youngest is 12-years old. There will be approximately 63 million
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STRATEGIC BRIEF
Brian S. Harrington
May 5, 2006

2. Millennials driving by 2010, bigger than the Boomers. This generation is the most
ethnically diverse generation yet…one in three are not Caucasian. One in four live in a
single-parent household and three out four have working mothers. One in nine high
schoolers has a credit card co-signed by a parent. Millennials have an average of $100 per
week of disposable income because 40% of them hold at least a part-time job.
This generation is heavily influenced by their peers and brand names, which means they
are susceptible to what brands their peers like or do not like.
Millennials are less cynical and more concerned regarding social issues than Generation
X. A little more than ¾ of this generation have a computer at home and 50% have access
to the internet from home. Studies have shown that Millennials prefer directness over
subtlety, action over observation and cool over all else.
Social/Cultural
Just like every other generation, Millennials too had positive and negative social issues
that shape their lives through their formative years (1992 to 2002). Some of these issues
included, but are not limited to: the rise of the Internet, Wireless, Dotcom Boom/Bust,
DVR, 9/11, Clinton scandal, Rodney King Riots, OJ Simpson Trial, Reality Television
(i.e. Survivor, Big Brother, Real World), the Global War on Terrorism, SARS and the
Y2K Bug.
Millennials are less hung up on race, gender or ethnicity than their parents, but may
increasingly be moving toward increased sensitivity to the economic classes. Various p
rograms ranging from affirmative action to gender-equity sports-programs have reduced
cultural and gender gaps during their childhood, but the gap between rich and poor has
steadily widened.
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3. Political
Millennials are more focused on local activism and community service and less focused
on national, international and global matters. 82.6% performed volunteer work last year
and 47.5% participated in organized demonstrations last year.
Family
This generation tends to fear intimacy in relationships and that is why they avoid
traditional dating and they choose to travel in groups. They experience pressures and high
expectations, as well as, involvement from parents who are often meddling, intruding and
over-protective. Millennials are made to feel special and sheltered. They expect high
and often unrealistic levels of “customer service,” as do their parents.
Technology
Millennials were the first generation to use or witness the following technologies from an
early age; the Internet, sophisticated computer graphics in many video games, animated
movies/TV shows. Cellular phones, instant messaging, DVD’s, Digital Audio Players
(MP3), DVR (TiVo), HDTV, Broadband/Wireless Internet and Digital cameras.
Therefore, Millennials are more receptive to new technology and they will demand it.
This generation uses technology intensely, as well as, keeping up with the changes. Men
are more likely to frequent Internet chat rooms and use the Internet for other reasons or
activities. 35.4% of men reported playing video & computer games for three or more
hours per week (compared to 9.6% of women). A recent study suggests that 10% may
spend too much time online and be classified as “Internet Dependent”.
Value Proposition
Convenience, quality, service and cost are what drive Millennials into purchases. They
are not accepting responsibility yet, they tend to get bored easy and they don’t want
authoritative careers. However, they do want to make a lot of money. This generation
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4. Identifies with their parents’ values, accept authority. They are turning back to
traditionalism, but with a modern twist. They are turned on by personal style and
innovation.
Purchase Patterns/Behaviors
Millennials are expected to retain close parental bonds even after leaving home and they
are more likely to consult with their parents on major decisions (i.e. vehicle purchase).
Edgy brand associations may fail to appeal to this increasingly conventional generation,
which looks for social consensus instead of pushing the limits of taste.
Marketing Communications
Millennials get their marketing messages from the last place that boomers do - the
Internet (followed by radio, cable, television, magazines and newspapers). The media
outlets recognize the spending power of Millennials and have modified their age-old
methods to meet the demands of this generation. They are redefining commercial TV for
this generation because Millennials don’t like commercial breaks, so product "ads" are
being inserted into the programming in the form of product placements and program
sponsorships.
The marketing should be community/group based and not individual, they want to feel
secured and protected with the brand. They are also achievement-oriented, so they are
going to hold high expectations of the Nissan vehicles in all marketing communications.
Automotive Trends
The primary selling points for this generation are the same as 30 years ago: price and
value. The average sticker price for a new car sold to buyers under age 24 (most of them
buy used cars) is $15,000. They purchased approximately 850,000 vehicles last year
(roughly 6% of the total U.S. sales market). However, they are on target to buy in excess
of 3.5 million vehicles by 2010…almost one in every four vehicles bought.
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5. There should be no surprise the Hyundai Accent ($10,000) and Elantra ($13,000) have
the youngest average buyers of any on the market, at age 24. The Scion vehicles may be
the industry's most radical step toward offering young buyers great value in an
unconventional package, but it has had just a modest success on this generation.
The automotive brand is more important in the decision process than the actual model
when Millennials are looking at Asian brands. However, when they are looking at
domestic and European brands it is more of a balance between the brand and model. A
Car Internet Research Program study indicated Millennials perceive Nissan and other
Japanese brands as more cool, sexy and sweet products. They felt the Korean brands were
“lame” and the domestic brands were more for “their parents”.
The same study indicated that the manufacturers websites were the chosen source of
getting information and 30% of the visitors are more likely to take a test drive.
Additionally, 30% of this generation would consider buying a vehicle over the Internet.
Imports still have an edge with this generation because Nissan, Toyota, Honda and
Hyundai refresh their small-car lineups more frequently than Detroit. However, no brand,
import or domestic, has truly locked up the loyalty of the youth market. The Pontiac
Aztek, Chrysler PT Cruiser and Toyota Echo, all struck out with this generation. Honda’s
Element hit the market with a splash, but it has lured more forty-somethings than
hipsters.
Conclusions
The marketing strategy should focus more on the Nissan brand than their products.
Nissan needs to enhance their brand reputation…then the Millennials will be more
responsive to purchasing a Nissan vehicle.
The Nissan vehicles that this generation will most likely purchase, because of
affordability, would be the Versa and Sentra, but they aspire to the Altima and Murano.
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6. The marketing communications plan should focus more on interactive, sponsorship and
product placement campaigns. This generation is very active online, so Nissan should
look into video games, blogs and online advertising (banners). Millennials are involved
in some capacity within action sports (i.e. skateboarding, snowboarding, etc.) and cultural
activities, therefore, sponsorships would be an effective solution. Product placement has
become a highly used media solution over the past couple of years and it is another useful
way to reach Millennials, but Nissan needs to be careful because product placement is
getting a little over exposed.
Conventional media (TV, radio, magazine and outdoor) is not going to be as effective for
this target as the communication initiatives indicated above would be. Therefore, to
reach this target, Nissan should move all or a majority of their conventional media dollars
to the communication plan previously indicated.
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7. SOURCES
Neil Howe, Millennials Rising: The Next Great Generation, © 2000
Christian Navarre, Winning the Youth Market, Car Internet Research Group, © 2003
David Welch, Autos: Not your Father’s…whatever – What does Gen Y want in a car?,
Business Week, March 15, 2004
Ellen Newboren, Generation Y: Today’s teens…the biggest bulge since Boomers,
Business Week, February 15, 1999
Dr. Pete Markiewicz, Who’s Filling Gen Y’s Shoes?, Brand Channel.com, May 5, 2003
Claire Rains, Managing Millennials, Generationsatwork.com, © 2002
www.census.gov
www.wikipedia.org
www.geocities.com/ihategenx/Generations.html
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