Mar 13 2019

How to Reach Millennials and Gen Z: ShopTalk ’19

The youngest millennial is entering college, with the oldest nearing 40 years old. They spend less time watching TV and more time on YouTube, they prefer blogs over magazines, and of course, they’re savvy social media users. Most importantly, they’re in their prime spending years—making them a prime mark for bands and retailers.

However, millennials are difficult to target. They make decisions quickly and move on to the next thing quicker than you can say “hello.” Legacy brands find it tough to connect with this generation, and it’s only going to get tougher.

Lisa Wu, Partner at Norwest Venture Partners, brought together three very different brands to discuss their approach to reaching Millennials and Gen Z: Burrow, the digitally native brand, 1-800-Flowers, the legacy brand, and e.l.f Cosmetics, an early 2000s ecommerce brand crossed with retail.

Millennials need an emotional connection

Millennials are more educated and more aware. They see a product, determine they like it, but then they need a reason to purchase the item. “It really is a culture innate fact of life that’s extended through every generation,” says Leslie Leifer, Vice President of Enterprise Strategy and Business Development at 1800Flowers.com. It goes far beyond listing out the features and benefits, it’s about explaining what the brand stands for and how that would add value to the customer’s life.

Stephen Kuhl, Co-Founder & CEO of Burrow, adds, “It’s easy to start a brand. It’s hard to start an authentic brand that resonates with people.” In the furniture industry, they saw the same brand over and over again. Each one uses beautiful photography with no people—the imagery is inspirational but sets unrealistic expectations.

After researching their Millennial target audience, Burrow realized their customers like to have nice things that are comfortable. It comes down to “figuring out what makes sense for your customers but communicating that you understand them and that you’re the best person to provide the product to service,” adds Kuhl. Regardless of what your brand’s stance is, be it environmental, comfort, or origin, that’s what you build your brand around

For beauty, the competition has gotten more intense in the last couple of years with digitally native brands, influencer brands, and retailers. When e.l.f. Cosmetics first launched, they weren’t necessarily a disruptor, but they made their products accessible through their direct-to-consumer site. Over time, the beauty brand realized they can’t survive simply on accessibility. “You have to stand for something and create a narrative about that [stance] to build loyalty and connection,” says Gayitri Budhraja, VP, Brand, e.l.f. Beauty.

There’s plenty of opportunity in offline marketing and experiences

About 85% of e.l.f.’s sales come from retailers, so making the physical shelf in the store as immersive as possible is key for converting shoppers. Previously, their strategy with any retailer was putting as many of their products on the shelves as possible. Now, it’s more about telling the brand’s story.

Budhraja says, “How do we create more space and breathing room in our brand presentation within retail where we are potentially making a trade-off with fewer products on the shelf. But it gives us much more of an opportunity to actually tell our brand story, to educate her on the shelf, and enable to navigate her in a way that she hasn’t done before.”

Rather than partnering with retailers, Burrow opened two showrooms—one at their office and another in Soho. The experiential showroom, called Burrowhouse, is set up as a physical home. Customers can relax on the Burrow furniture as associates serve beverages and snacks or watch a movie in the basement theatre. Kuhl states, “The goal there was to spread awareness and to introduce people to our brand as [associates] are having conversations with the customers.”

The saturation of influencers

All three panelists agreed that the influencer market is saturated. Today, anyone can build a following and seek out brands for free products in exchange for a post. Despite its saturation, influencers remain an important aspect of reaching new customers. “There’s a side of influencers that believe in what they’re promoting and incorporate it into their lives,” notes Leifer. Then, there’s the debate of micro-influencers vs. macro-influencers. The bigger influencers tend to hop from one brand to another, so it’s less about brand loyalty and more about reaching a large audience.

“It goes back to selecting influencers…where there is a real authentic connection between that person and the brand,” says Budhraja. e.l.f. Cosmetics reaches over 100 million consumers through their influencers. These consumers are smart—they can easily “smoke out” the brand-influencer relationships that are disingenuine.

Borrow only uses influencers that already use their products and seek them out. Kuhl says, “The best ones will come to you. You need to make sure you have a platform to help them tell your story.” This could be referral programs to track the sales generated from the partnership, or sharing their user-generated content on the brand’s social channels.

Keep in mind that every customer is an influencer. It doesn’t matter if they have 20 followers or 20,000, they have the ability to tell their friends, family, and co-workers about the products they try and liked or disliked. For Millennials and Gen Z, it comes down to buying from brands that are worth talking about.

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Chris Guerra

Chief Growth Officer

Chris J. Guerra is the Chief Marketing Officer at Blue Acorn. Previously, Guerra led the North America division for Portalis AG, launched Coupons.tv a daily deal aggregator and video review site, served as the vice president of business development & strategic initiatives for Entertainment Media Works (EMW), a digital media company, and founded Brand Orders, a community for retailers to purchase wholesale product from brands. Guerra grew up across the country, exposed to the retail industry through family involvement at Barney's NY & Nike.

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