The Me Generation has given way to the All About Me Generation.
This story first appeared in the September 6, 2013 issue of WWD. Subscribe Today.
Consider the case of Kate Spade Saturday, which launched in March as a lower-priced, more casual alternative to its 20-year-old sister brand Kate Spade New York.
Key attributes of the brand—which was created exclusively with Millenials in mind—include pop-up stores where merchandise can be ordered electronically and delivered within the hour, an active social-media presence across multiple platforms and products like the best-selling Weekender bag that can be personalized by shoppers in gazillions of ways.
Sales have soared, and already, company executives are prediciting that Kate Spade Saturday’s store count could soon exceed that of the original.
For marketers, it seems, Baby Boomers are quickly becoming ancient history, their worries about who will replace beauty’s most important generation being allayed by the emergence of a group that shows a budding affinity for the category.
“They are the future,” says Julie Bornstein, executive vice president and chief marketing and digital officer of Sephora. “They are our present and our future.”
Millennials, the generation broadly defined as those born from 1980 to 2000, are gaining increasing importance as a consumer force to be reckoned with, a trend expected to accelerate dramatically in the next decade. An overview of the numbers quickly shows why. According to a report issued by Jefferies and Alix Partners, by 2020, Millennials will double in importance regarding the spend they control in the U.S. The number of Baby Boomers under 60 is expected to decrease to 17.6 million people in 2020, versus 59.8 million in 2010. Conversely, by 2020, Millennials over the age of 25 will be 19 percent of the population, about 64.1 million people, up from 5 percent, or 17.1 million people, in 2010. The report notes that just following a person’s 25th birthday, median income historically jumps 60 percent.
“By 2020, there will be 78 million Millennials,” says Mark Brooks, senior vice president of consumer and market intelligence at L’Oréal USA. “It is the next big generation. It’s not an easy target, but it is something that is absolutely critical.”
The numbers, again, point to the challenges that Brooks references in his remarks. The demographic characteristics of Millennials are as broad as their numbers. “It’s not a one-size-fits-all group,” says Brooks. “A third of them have lower incomes, a third are middle income and a third are upper income. Some are still very dependent on their parents, even when they’re starting to earn, caught between the difficulty of getting a mortgage, the job market and student loans.
“Most of them—38 percent—don’t have kids,” Brooks continues, noting L’Oréal segments Millennials into about six groups, “but almost half have young families. There are a lot of nontraditional families, some live with parents, some with friends and roommates, some have children with no spouses. It’s a very diverse group of people.”
“It’s hard to talk about them in one big lump,” agrees Wendy Liebmann, chief executive officer of WSL Strategic Retail. “You’ve got so many life stages and different things that have happened over that 20-year period. The younger end of the segment are the ones who’ve grown up in the post 9/11 and global financial crisis world with technology at their fingertips, and that has had a huge impact. The older ones have been influenced by that, but less so.”
Multiculturalism is another defining characteristic. According to Pew Research, Millennials are more ethnically and racially diverse than older adults. In the U.S., of those ages 18 to 29, about 61 percent are Caucasian, 19 percent are Hispanic, 14 percent are Black and 5 percent are Asian; for adults 30 and older, the figures are 70 percent Caucasian, 13 percent Hispanic, 11 percent Black and 5 percent Asian.
Globally, the Millennial generation is growing even faster in two of beauty’s key emerging markets: Latin America and Asia. According to The NPD Group’s vice president and global industry analyst Karen Grant, by 2033, the number of people under 30 will be the same size as the group of those 50 and above in North America. But in Asia and Latin America, those under 30 will form the largest age group.
But savvy marketers aren’t waiting for tomorrow to target Millennials. MAC, one of the most popular makeup brands with younger shoppers, is readying a youth-oriented store format that is scheduled to open at Orlando’s The Florida Mall in November. This September, Shiseido launched Ibuki, its first new skin-care range in eight years, aimed squarely at Millennials, particularly those between 25 and 34 years old. “They are already spending $250 billion annually and their spending power is expected to surpass the spending power of Boomers by 2017,” says Heidi Manheimer, chief executive officer of Shiseido Cosmetics America, who jokingly adds, “I thought we were the big shoppers! What happened?”
Millennials may already have demonstrated their affinity for shopping, but the means in which they like to do so differs markedly from other generations. David Garfield, a managing director of Alix Partners and lead writer of the report, “Trouble in Aisle 5,” which presents an in-depth look at how Millennials will impact food retail, conducted a deep dive into how the group spends its money. “They are different,” he says. “If they behaved just like other segments, it wouldn’t be as big a deal, but their shopping behavior, purchasing criteria and brand preferences are different. Marketers have to adapt.”
The biggest influencer in what differentiates Millennials from older generations is their affinity for all things digital. “They are the earliest adopters,” says Carlotta Jacobson, president of Cosmetics Executive Women. “They are the ones who will push companies to merge the digital into a critical part of the business. They connect with people in a different way.”
Research from Pew shows that Millennials are, literally, always connected. More than eight in 10—83 percent—report sleeping with their cell phone next to their bed, versus the average of 57 percent across all age groups. Seventy-five percent report having a profile on a social networking site, versus an average of 41 percent.
Sephora’s Bornstein says that while some marketers theorize Facebook is past its prime, the reality is that it remains the communications channel of choice for this generation. YouTube, as well, is incredibly powerful, as a learning tool but also as a starting point for shopping.
Figures from MAC crystallize the point. According to the brand, of its six million Facebook followers, five million are Millennials. On YouTube, where MAC generated 7 million views for the last fiscal year, 56 percent of the U.S. views on the global channels are Millennials. On Tumblr, where 67 percent of the users are under 35, MAC has more than 153,000 followers, while on Twitter, where 55 percent of the users are Millennials, MAC has 425,000. When the brand launched its RiRi—as in Rihanna—Hearts MAC collection exclusively online, 35,000 units sold out in less than three hours.
“They were born with a smartphone in their hands,” says Karen Buglisi, global brand president of MAC Cosmetics. “Social media is how they communicate with us, engage with us. It’s how they express themselves.”
One of MAC’s most popular recent programs is MAC By Request, a platform where consumers can vote to bring back products that have been discontinued. Buglisi says in two weeks, the program racked up 1.6 million votes. “They like having a voice,” she explains. “Control is very important to them.”
And if there is one thing that is especially important for this group, it is to make their voice part of a brand experience. This is not a group that wants to be dictated to in a top-down communication style, a fact which Kyle Andrew, senior vice president and brand director of Kate Spade Saturday, has kept top of mind during the development of the label. “Millennials want to be part of the experience. You can’t just put stuff out there and expect her to engage,” she says. “She likes to feel she is in the know. She wants to go deeper and feel like she is part of the process.”
As an example, Andrew explains the brand’s approach towards shooting an ad campaign. In the past, print ads would debut in select magazines on specific dates. Now, the entire process is posted on the brand’s social-media site—in real time. “We’ll show her what we’re shooting for fall way ahead of the launch date and then read the comments,” says Andrew. “We love when she says, ‘I love that skirt.’ If enough people say it, we may make more. It’s a great way to get insight into what you’re doing that may allow you to course-correct as you go along.”
For the launch of Ibuki, Shiseido created a special microsite with product details, education and a rich social experience that allows users to read about the life experiences of like-minded people as well as share their own. “They want a seamless experience between offline and online,” says Manheimer.
Anything less than a completely seamless experience is unacceptable to Millennials, Andrew has found. “When we haven’t had a product in stores that has been on the Web, she gets mad. She does a lot of research online and comes into the store to try on merchandise. You can’t make it hard for her—it has to be easy.”
“They are very unforgiving if you are not allowing them to shop anywhere, anytime, anyhow,” agrees Liebmann. “If you create barriers for them, they will go elsewhere.”
Innovation and newness—both in terms of product and shopping experience—are also key drivers. Liebmann singles out the Japanese fast-fashion retailer Uniqlo as a company that understands this and executes against it better than most. “Uniqlo offers a tremendous value proposition, but they are constantly innovating around product,” she says, citing products such as its Airism collection of innerwear, which absorbs moisture to keep the body dry, releases body heat quickly and imparts a cooling sensation. It also has anti-odor technology. A T-shirt costs about $13. “Uniqlo also has a massive in-store experience, which is dazzling, but at the same time, the product is very affordable,” Liebmann points out. “They’re not saying because we’re inexpensive we don’t innovate or we are not creating a highly emotive physical retail experience. They do all of that, and that’s why they are very relevant to this audience.”
For its part, Kate Spade Saturday’s stores feature iPad signage rather than the traditional variety, and during the pop-up phase of the brand launch, Kate Spade partnered with eBay’s Now program to give shoppers local delivery of products in an afternoon. “It’s important to stay ahead of this customer to keep her interested,” says Andrew. “There is so much noise out there. The pop-up stores were hard to execute—it took a lot of time, money and resources—but we got her attention. Which is hard. Super hard. But you have to.”
Even their expectations for a relatively quotidian retail experience are high. “Of course it has to be lively and engaging,” ticks off Grant. “Millennials like to have help when they need it. They want to be able to price-compare. They want to engage with their mobile device, so they can check the price. They want an environment that will nurture them and make them feel secure when asking for advice and they like to shop with their friends.”
The concept of brand or channel loyalty, however, is largely nonexistent. “Millennials are more willing to jump from one channel or store format to another, whereas Boomers tend to buy the same types of products from the same retail channels,” says Garfield. “Millennials tend to be more adventuresome shoppers, and are open to discovering new products and brands.”
Such an attribute is both a positive and a negative, points out Garfield. Brands with a hot new product can generate trial quickly, whereas those who don’t lose consumers quickly. Says Garfield, “It gives you the opportunity to attract and earn new consumers. It is also a threat to established businesses because it means a greater risk of churn.”
Millennials are also more frugal than the youth generations of earlier days. According to a survey WSL Strategic Retail conducted in June across all generations on saving and spending, 22 percent of Millennials said they’re putting more in savings in the last 12 months, five points higher than Gen X, eight points higher than Boomers and 9 points higher than Seniors. “It used to be you were young and you had money and it was all disposable,” says Liebmann. “But Millennials have the saver mind-set. They’re looking for deals, like shopping online or flash sales. It’s not about saving for a rainy day. It’s about being smart.”
The same study showed that 41 percent of Millennials use their mobile phones to compare prices while they’re shopping, 38 percent to take pictures of what they want to buy, 30 percent to find coupons and 29 percent to read reviews. For Boomers, the stats are 26 percent, 31, 15 and 17, respectively.
In terms of beauty categories, Millennials are extremely engaged with makeup. In a recent study on the Millennial makeup market by the market research firm Lab 42, 65 percent of respondents said they wear makeup every day, and 58 percent said they purchase different products for the summer and winter. (Lip gloss is their number-one item.)
But Bornstein says she has also noticed that Millennials are also very engaged in skin care despite their tender years, which she says actually points to a larger desire among the group. “This generation is more attuned to skin care and aging at an earlier age. And while they’re definitely playing with nail and lip, they are moving from lip gloss to lipstick, which makes them feel more grown up.” To that end, Sephora’s most popular brands with Millennials are Nars, Benefit and Laura Mercier. “These brands are accessible and understandable, but feel like the next level up in terms of taking care of yourself,” explains Bornstein. “In talking with consumers of this generation, we keep hearing that beauty is not just on the surface. It is how you feel, carry yourself and how you look. They want to take care of themselves.
Meet the Millennials
Down time is not a concept that resonates with Zuzanna Bijoch. The in-demand 19-year-old is a favorite of photographers like David Sims and Craig McDean, and also stars as the face of Tom Ford Beauty. This summer, though, she also took on an internship in the finance department of Tom Ford. “My dream is to work on Wall Street,” says Bijoch, who started modeling at 16 and relishes the predictability of her corporate gig. “It’s a great opportunity to learn something different, and the hours are set,” she says. “I know what to expect the next day, which isn’t something in my daily life.” That’s not to say Bijoch doesn’t enjoy her day job, either, though. “I love the moment when you’re getting into character and being someone you’re not,” she enthuses. And for Bijoch, character defines beauty. “It’s a sensation, not a thing,” she says. “It’s a mix of charm, class, uniqueness.”
For Bree Smith, true beauty comes from the power of positive thinking. “It’s about how a person cares for herself,” says the 19-year-old, “like a good spirit or a happy person.” Smith has a lot to be happy about lately. Since graduating from high school and moving to New York last year, the Indiana native has been photographed by superstars like Daniel Jackson, Pamela Hanson and Santiago & Mauricio and appeared in magazines such as Lucky, Interview and Teen Vogue. She relishes the excitement of the fashion industry—“I don’t have a set schedule. I’ll get a call to go somewhere right away”—and she is eager to embark on her first Fashion Week. “I’m going in with an open mind,” she says. “I’ll be happy with anything. I’m just excited to do it.”
For Pritika Swarup, Disney World must really be her happiest place on earth—that’s where she was discovered during a family trip last December. Less than five months later, the 17-year-old is booking jobs, having wrapped up her junior year of high school in her native Virginia and transferred for her final year to a school in New York City. “It’s all very new,” she laughs. “I just moved to New York so HopStop and Google Maps has been used everyday.” Swarup has been equally as busy shooting with photographers like Anna Wolf and Alexandre Valerio and perfecting her walk as she gears up for her first-ever Fashion Week. “I’m looking forward to this once- in-a-lifetime opportunity to work with designers,” says Swarup. “I’m excited to experience the craziness of fashion week for myself.”
Meet the Millennials: 5 Key Points
Know the Numbers: By 2020, the Millennials will double in importance in terms of the spending they control in the U.S.
Plugged In: Eight in 10 Millennials sleep with their mobile phone. Enough said.
Innovate, Innovate, Innovate: Whether with products or in-store experience, Millennials expect to be dazzled.
Can You Hear Me Now?: This generation is eager to engage in conversation with her favorite brands. Listening and reflecting back her opinion is essential.
Make It Count: Millennials are value-conscious, savvy shoppers who are as apt to deposit disposable income in a savings account as they are to treat themselves.
Meet the Team
WWD Beauty Inc tapped a team of rising stars to create the visuals for this story, giving them free rein to create pictures that represent their collective vision of beauty for a new generation. —JAYME CYK
PHOTOGRAPHER: JASON KIM
Clean, sharp, unexpected and young is how 22-year-old photographer Jason Kim describes his work. “I love combining different ideas like Hare Krishna and Club Kids,” says Kim. “It’s all about the balance between technicality and the artistic side, of being commercially viable and super editorial.” Raised in the suburbs of Chicago, Kim was given an assignment way back in middle school to pick a career path. He chose fashion photographer and hasn’t looked back since. Success came early, as well. Thus far, Kim has shot for magazines including V, VMan, M, Elle, French Glamour and Nylon. “I went to [college] for two years and at the same time, I started booking jobs,” he recalls. “It was difficult to balance school and work, so I left [school] and started going on set with photographers a bit. [Then] I began doing everything on my own.” Kim’s favorite photographers include Hiroshi Sugimoto, Viviane Sassen and David Sims, but his self-assurance and vision on set are very much his own. “I’m very much a product of the digital age,” he says, “where these days you’re able to figure things out yourself.”
STYLIST: CLARE BYRNE
Clare Byrne grew up on a farm in Australia’s Hunter Valley, where her father bred racehorses, an upbringing that remains a key influence in the 27-year-old’s work. “My styling is sporty at times,” says Byrne. “I like Céline and Calvin Klein. That design reflects an element of my taste.” Byrne, who moved to New York in 2011 to pursue a career in styling, aims to enhance the uniqueness of her subjects, particularly for beauty shoots. “I like an element of realness,” she says. “It’s important, even if there’s a heavy eye or bold lip, to always keep one natural element.”
MAKEUP ARTIST: JUSTINE PURDUE
For 35-year-old Justine Purdue, when it comes to makeup, less is more. That aesthetic has appealed to the likes of photographers Sebastian Faena and Cedric Bouchet, with whom Purdue has worked regularly since moving to New York City from her native Australia about 12 months ago. “Beauty is individuality,” says Purdue, who is inspired by various cultures in her work. “It’s embracing our own uniqueness, and celebrating our differences.” But everyday life is also a key influence “I always base my work on something real and give it authenticity. I don’t like to look at past work from other makeup artists. I want to have my own vision.”
HAIR STYLIST: ROMINA MANENTI
Hair stylist Romina Manenti started out as a fashion stylist, but quickly changed gears to realize her true passion. “I love to work with texture,” says the 33-year-old. “It’s so tangible and you can change it in a half-hour to another aesthetic.” The Italian native recently relocated from Paris, where she worked with photographers like Ellen Von Unwerth and Serge Leblon, to New York. Stylistically, Manenti is looking to make a statement. “Aesthetically and visually, I want to make an impact and attract attention,” she says. “But at the same time, I want to give a shape that evokes emotion.”