Generation Gap

Milleninals—a.k.a., the Facebook generation—are changing the ways companies do business.

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They're called the ADD Generation, and they’re usually on their smartphones updating their Facebook status, tweeting about their day, or watching the latest mashup on YouTube. But executives must pay attention to Millennials—those born between 1977 and 1996—use their approach to business, branding, and quality is driving sweeping changes to the nature of commerce.

“While Millennials may not yet be CEOs of Fortune 500 companies or leaders of the free world, they are possibly the biggest influencers and innovators today,” finds a new study conducted by market research firm Intrepid and Mr. Youth, a marketing agency. The study argues that new ideas, creative approaches, innovative products, open communication, connected communities, and an increased passion for change will be among the key elements of success in the next decade. “Embracing the Millennial perspective is key to anyone wanting to keep up (and move ahead of the curve).”

Companies already see they have to change their ways, and some have gone as far as to create new positions, like Vice President of Social Media, an executive-level job filled by mostly mid-20-year-olds to keep their brands relevant and capture the key 24-to-35-year-old demographic that spends so much of its time online and on the go. “Many companies are finding that with social media, their audience is actually much smaller, and it’s of utmost importance for them to deepen communication with their customers,” says Sam Ford, director of customer insights at Peppercom Strategic Communications in New York. “And they’re seeing the benefit of being able to personalize a targeted message to their core audience.”

When it comes to creating advertising that works, companies should ditch the traditional tried-and-true methods. Gone are the days of overhyped ads that bombard consumers with empty promises. “Millennials are the savviest consumers ever. They are wary of ads,” the study says. Companies need to reach out to their customers in meaningful ways that add value to their lives and form a connection with the brand, experts say. For many, that means establishing a presence on social-media platforms. “These days, companies need to go where their consumers are, and the majority of them are on Twitter, Facebook, and YouTube,” says Denise McVey, president of S3, an agency specializing in advertising, marketing, and public relations.

And it’s not just the marketing world that Millennials are changing. It’s also the fundamental corporate culture. Where traditional businesses value experience and a certain will to keep rehashing ideas that have worked in the past, this generation craves roundtable, collaboration, shared responsibility, and creativity, the study finds. Market leaders like Microsoft and Google are letting small groups within their corporate structure experience with a consensus-rule approach where no definitive project or group leader is assigned and decisions are vigorously debated, which leads to innovation, experts say.

Another changing trend is job retention. Even in these challenging economic times, the average 26-year-old has changed jobs seven times from age 18, the study reports. “We’re living in a 24-hour cocktail party, and if we don’t keep coming up with new ideas, people will move on,” says Richard Laermer, author of Punk Marketing and founder and CEO of RLM PR. In fact, the primary reason Millennials cite for leaving a job was needing a change to a more stimulating environment—even over salary—according to the study. And companies should take note because respondents say that if they pitch big ideas that are ignored, those ideas will go elsewhere. Millennials know that someone out there is entrepreneurial enough and willing to pay big bucks for the next huge concept.

But for most companies, these changes are coming so rapidly that they’re caught off guard and sticking to their old routines because they don’t know how to address this growing group, industry experts say. So what can they do to keep ahead of the trend rather than follow it—or worse, see themselves left behind? Some of the finding’s conclusions:

• Enable open collaboration across the organization.
• Ask for more from every employee. Continually present new challenges and allow for rapid growth for those who perform.
• Value ideas over experience whether from the CEO, mailroom clerk, supplier, or customer.
• Don’t skimp on the quality. Consumers are willing to pay more if they think the product will last. And they quickly avoid those that fail to meet their expectations.
• Be genuine. Don’t hide behind celebrity personae. Focus on connecting to individual consumers and communities in ways that are authentic, relevant, and meaningful.
• Partner with your consumers. Live and breathe transparency.
• Foster advocacy. Build products that create marketing that invites consumers to share and leverages word-of-mouth over traditional advertising.
• Change. If your business is not continually searching, evolving, and finding new ways to do things, you won’t keep up.