2.3: Generations - Differences

Psychographics should not be confused with demographics, for example, historical generations may be defined both by demographics, such as the years in which a particular generation is born or even the fertility rates of that generation's parents, but also by psychographic variables like attitudes, personality formation, and cultural touchstones. For example, the traditional approaches to defining the Baby Boom Generation, Generation X, or Generation Y, also referred to as Millennials, and Generation Z, the Plurals, have relied on both demographic variables (classifying individuals based on birth years) and psychographic variables (such as beliefs, attitudes, values and behaviors). For example, generations born into technology have a much higher propensity to understand and use technological products at a higher rate than generations less familiar with such developments.

Baby Boomers

Baby boomers are people born during the demographic Post-World War II baby between the years 1946 and 1964. According to the U.S. Census Bureau (2011), the term "baby boomer" is culturally contextual as well. Therefore, it is impossible to achieve broad consensus of a precise date definition, even within a given territory. Different groups, organizations, individuals, and scholars may have widely varying opinions on what constitutes a baby boomer, both technically and culturally. Ascribing universal attributes to a broad generation is difficult, and some observers believe that it is inherently impossible. Nonetheless, many people have attempted to determine the broad cultural similarities and historical impact of the generation, and thus the term has gained widespread popular usage.

Baby boomers are associated with a rejection or redefinition of traditional values; however, many commentators have disputed the extent of that rejection, noting the widespread continuity of values with older and younger generations. In Europe and North America, boomers are widely associated with privilege, as many grew up in a time of widespread government subsidies in post-war housing and education, and increasing affluence (Owram, 1997).

As a group, they were the wealthiest, most active, and most physically fit generation up to that time, and amongst the first to grow up genuinely expecting the world to improve with time (Jones, 1980). They were also the generation that received peak levels of income therefore they could reap the benefits of abundant levels of food, apparel, retirement programs, and sometimes even "midlife crisis" products. The increased consumerism for this generation tends to be excessive (Pinker, 2011).

One feature of the boomers was that they tended to think of themselves as a special generation, very different from those that had come before. In the 1960s, as the relatively large numbers of young people became teenagers and young adults, they, and those around them, created a very specific rhetoric around their cohort, and the change they were bringing about (Owram, 1997). This rhetoric had an important impact in the self-perceptions of the boomers, as well as their tendency to define the world in terms of generations, which was a relatively new phenomenon.

Size and economic impact

Seventy-six million American children were born between 1945 and 1964, representing a cohort that is significant because of its size alone. In 2004, the UK baby boomers held 80% of the UK's wealth and bought 80% of all top-of-the-range cars, 80% of cruises and 50% of skincare products (Howe and Strauss, 1991).

In addition to the size of the group, one thing that sets the baby boomers apart from other generational groups is the fact that "almost from the time they were conceived, Boomers were dissected, analyzed, and pitched to by modern marketers, who reinforced a sense of generational distinctiveness" (Gillon, 2004). There is support from the articles of the late 1940s identifying the increasing number of babies as an economic boom, such as a 1948 Newsweek article whose title proclaimed "Babies Mean Business" (Newsweek, 1948). In contrast, the 'age wave' theory suggests an economic slowdown when the boomers start retiring during 2007–2009. Projections for the aging U. S. workforce suggest that by 2020, 25% of employees will be at least 55 years old (Chosewood, 2012).

Baby boomers control over 80% of personal financial assets and more than half of all consumer spending. They buy 77% of all prescription drugs, 61% of over-the-counter drugs, and 80% of all leisure travel. A survey found that nearly a third of baby boomers polled in the United States would prefer to pass on their inheritance to charities rather than pass it down to their children (Sullivan, 2007).

Cultural identity

Boomers grew up at a time of dramatic social change. In the United States, that social change marked the generation with a strong cultural cleavage, between the proponents of social change and the more conservative. Some analysts believe this cleavage played out politically since the time of the Vietnam War to the mid-2000s, to some extent defining the political landscape and division in the country (Sullivan, 2007). Starting in the 1980s, the boomers became more conservative, with many regretting the cultural changes they brought in their youth (Bowman, 2011).

Generation X

Generation X, commonly abbreviated to Gen X, is the generation born after the Post World War II baby boom. The 2011 publication "The Generation X Report", based on annual surveys used in the Longitudinal Study of today's adults, finds that Gen Xers in the report are people born between 1961 and 1981, are highly educated, active, balanced, happy, and family oriented. Gen Xers are often called the MTV Generation (Isaksen, 2002). They experienced the emergence of music videos, new wave music, electronic music, glam rock, heavy metal, alternative rock, and hip-hop (Wilson, 2011).

Compared with previous generations, Generation X represents a more apparently heterogeneous generation, openly acknowledging and embracing social diversity in terms of such characteristics as race, class, religion, ethnicity, culture, language, gender identity, and sexual orientation (Isaksen, 2002).

Unlike their parents who challenged leaders with an intent to replace them, Gen Xers are less likely to idolize leaders and are more inclined to work toward long-term institutional and systematic change through economic, media and consumer actions. The U.S. Census Bureau reports that Generation X statistically holds the highest education levels when looking at current age groups (U.S. Census Bureau, 2009).

Entrepreneurship

According to authors Michael Hais and Morley Winograd, "small businesses and the entrepreneurial spirit that Gen Xers embody have become one of the most popular institutions in America. There has been a recent shift in consumer behavior and Gen Xers will join the “idealist generation” in encouraging the celebration of individual effort and business risk-taking. As a result, Xers will spark a renaissance of entrepreneurship in economic life, even as overall confidence in economic institutions declines. Customers, and their needs and wants (including Millennials) will become the North Star for an entire new generation of entrepreneurs" (Winograd and Hais, 2012).

According to Kjetil Olsen of Elance, the company which conducted the study, "the big issue for Generation X (born 1961 and 1981) was the end of a job for life," unlike "today's Generation Y (born 1982 to 1993) who appear to be seriously questioning the nature of having a traditional job at all" (Silvera, 2014). In 2012, the Corporation for National and Community Service ranked Generation X volunteer rates in the U.S. at "29.4% per year", the highest compared with other generations. These rankings are the result of a three-year moving average between 2009 and 2011 (U.S. Department of Labor, 2013).

Millennials

Millennial Generation (known as the Millennial or Generation Y) are the demographic cohort following Generation X. There are no precise dates when this generation starts and ends. Researchers and commentators use birth years ranging from the early 1981s to the early 2000s.

Traits and values

Strauss and Howe (2000) believe that each generation has common characteristics that give it a specific character, with four basic generational archetypes, repeating in a cycle. According to their theory, they predicted Millennials would become more like the "civic-minded" G.I. generation with a strong sense of community both local and global.

Strauss and Howe's research has been influential, but it also has critics (Hoover, (2009). Jean Twenge, the author of the 2006 book Generation Me, considers Millennials, along with younger members of Generation X, to be part of what she calls "Generation Me" (Twenge, 2006). Twenge attributes Millennials with the traits of confidence and tolerance, but also identifies a sense of entitlement and narcissism based on personality surveys that showed increasing narcissism among Millennials compared to preceding generations, when they were teens and in their twenties. She questions the predictions of Strauss and Howe that this generation will come out civic-minded (Twenge, 2012).

The Pew Research Center issued a report in March 2014 about how "Millennials in adulthood" are "detached from institutions and networked with friends." (Pew Social Trends, 2014). The report says Millennials are somewhat more upbeat than older adults about America’s future are with 49% of Millennials saying the country’s best years are ahead though they are the first in the modern era to have higher levels of student loan debt and unemployment.

Both the University of Michigan's Monitoring the Future study of high school seniors and the American Freshman Survey, conducted by UCLA's Higher Education Research Institute of new college students showed an increase in the proportion of students who consider wealth to be an important attribute. The percentages by generation include 45% for Baby Boomers (surveyed between 1967 and 1985) to 70% for Gen Xers, and 75% for Millennials. The percentage who said it was important to keep abreast of political affairs fell, from 50% for Baby Boomers to 39% for Gen Xers, and 35% for Millennials. The notion of "developing a meaningful philosophy of life" decreased the most across generations, from 73% for Boomers to 45% for Millennials. The willingness to be involved in an environmental cleanup program dropped from 33% for Baby Boomers to 21% for Millennials (Healy, 2012).

Eric Hoover (2009) posited that much of the commentary on the Millennial Generation might be partially accurate but overly general. He cites that many of the traits they describe apply primarily to white affluent teenagers who accomplish great things as they grow up in the suburbs; who confront anxiety when applying to super-selective colleges; and who multitask with ease as their ‘helicopter’ parents’ hover reassuringly above them. During class discussions, he has listened to black and Hispanic students describe how some or all, of the so-called “core traits” did not apply to them. They often say the "special" trait, in particular, is unrecognizable. Other socio-economic groups often do not display the same attributes commonly attributed to Generation Y. "It's not that many diverse parents don't want to treat their kids as special," he says, "but they often don't have the social and cultural capital, the time and resources, to do that." (Hoover, 2009).

Ron Alsop (2008) called the Millennials "trophy kids," a term that reflects the trend in competitive sports, as well as many other aspects of life, where mere participation is frequently enough for a reward, and an issue see primarily in corporate environments. Some employers are concerned that Millennials expect too much from the workplace. Studies predict that Millennials will switch jobs frequently, holding many more jobs than Generation Xers due to their great expectations (Alsop, 2008). Additionally, educational sociologist Andy Furlong described Millennials (in his book Youth Studies: An Introduction) as optimistic, engaged, and team players (Furlong, 2013).

David Burstein, author of Fast Future (2013), describes Millennials' approach to social change as "pragmatic idealism," a deep desire to make the world a better place combined with an understanding that doing so requires building new institutions while working inside and outside existing institutions (Burnstein, 2013). Millennial characteristics vary by region, depending on social and economic conditions. There is a marked increase in use and familiarity with communication, media, and digital technologies. In most parts of the world its upbringing was marked by an increase in a 'neoliberal' approach to politics and economics; the effects of this environment are under dispute (Seabrook, 2007).

Demographics

Strauss and Howe (1991) projected in their 1991 book "Generations" that the US Millennial population would be 76 million. Later, Neil Howe revised the number to over 95 million people (in the US). As of 2012, the estimation of approximately 80 million US millennials is widely accepted (Schawbel, 2012).

The economy has also had a dampening effect on Millennials' ability to date and, ultimately, get married. In 2012, the average American couple spent an average of over $27,000 on their wedding. A 2013 joint study by sociologists at the University of Virginia and Harvard University found that the decline and disappearance of stable full-time jobs with health insurance and pensions for people who lack a college degree has had profound effects on working-class Americans, who now are less likely to marry and have children within marriage than those with college degrees. Further, USA Today reported that Millennials are "entering the workplace in the face of demographic change and an increasingly multigenerational workplace" (Armor, 2014).

Digital technology

Junco and Mastrodicasa (2007) expanded from China to the United States on the work of Howe and Strauss to include research-based information about the personality profiles of Millennials, especially as it relates to higher education. They conducted a large-sample (7,705) research study of college students. They found that Next Generation college students, born from 1983–1992, were frequently in touch with their parents and used technology at higher rates than people did previously. In their survey, they found that 97% of these students owned a computer, 94% owned a cell phone, and 56% owned an MP3player. They also found that students spoke with their parents an average of 1.5 times a day about a wide range of topics. Other findings in the Junco and Mastrodicasa survey revealed 76% of students used instant messaging, 92% of those reported multitasking while instant messaging, 40% of them used television to get most of their news, and 34% of students surveyed used the Internet as their primary news source (Junco and Mastrodicasa, 2007).

Gen Xers and Millennials were the first to grow up with computers in their homes. In a 1999 speech at the New York Institute of Technology, Microsoft Chairman and CEO Bill Gates encouraged America's teachers to use technology to serve the needs of the first generation of kids to grow up with the Internet. Many Millennials enjoyed a 250+-channel home cable TV universe. In June 2009, Nielsen released the report How Teens Use Media that discusses the latest data on media usage by generation. In this report, Nielsen set out to redefine the dialogue around media usage by the youngest of Generation Y, extending through working age Generation Y compared to Generation X and Baby Boomers (Cabral, 2010). One of the more popular forms of media use in Generation Y is social networking. In 2010, research published in the Elon Journal of Undergraduate Research claimed that students who used social media and decided to quit showed the same withdrawal symptoms of a drug addict who quit their stimulant (Cabral, 2010). Mark Prensky coined the term 'digital native' to describe Generation Y "K through college" students in 2001, explaining they "represent the first generations to grow up with this new technology (Prensky, 2013)."

Generation Z

Generation Z is one name used for the cohort of people born after the Millennial Generation. There is no agreement on the exact dates of the generation with some sources starting from the mid-2000s to the present day (Poggi, 2013).

Traits and trends

Many members of this generation are highly connected, having had lifelong use of communication and media technology like the World Wide Web, instant messaging, text messaging, MP3 players, and mobile phones, earning them the nickname " digital natives " (Schmidt and Hawkins, 2008).

According to Hais, Winograd, and DeBord, the name "Plurals" reflects that Generation Z are the most diverse of any generation in the United States; estimates state that 55% are Caucasian, 24% are Hispanic, 14% are African-American, 4% are Asian, and 4% are mixed race or other. Hais and Winograd (2012) stated that Plurals exhibit positive feelings about the increasing ethnic diversity in the United States, and they are more likely than older generations to have social circles that include people from different ethnic groups, races and religions. According to DeBord (2012), Plurals are "the least likely to believe that there is such a thing as the American Dream," while Boomers and their Millennial children are "more likely to believe it"(Hais and Winograd, 2012; DeBord, 2012).

Relationship marketing. Plurals, with a more acute knowledge of technology, lend themselves to targeting through relationship marketing, a form of marketing developed from direct response marketing campaigns emphasizing customer retention and satisfaction, rather than a dominant focus on sales transactions. As a practice, relationship marketing differs from other forms of marketing in that it recognizes the long-term value of customer relationships and extends communication beyond intrusive advertising such as robot calling with sales promotional messages.

With the growth of the internet and mobile platforms, relationship marketing has continued to evolve and move forward as technology opens more collaborative and social communication channels. This includes tools for managing relationships with customers that goes beyond simple demographic and customer service data. Relationship marketing extends to include inbound marketing efforts, (a combination of search optimization and strategic content), public relations, social media and application development. Electronic marketing has become, and will continue to be a primary activity for product sense making as new generations become even more reliant on the computer information that has morphed into different modes as laptops, notebooks, IPads, and cellular phone applications.