To Be About To Be

American Demographics, Sept 1, 2003

Byline: Michael J. Weiss

WWhen Michael Piercey turned 21 last November, he celebrated the milestone like those before him have done for generations: He got mildly drunk. A part-time college student and radio engineer from Kensington, Md., Piercey gathered a handful of friends, ordered in pizza and Kevin Smith videos, and then drank too much booze - mostly shots of Jack Daniels chased with Coca-Cola. By midnight, he was loudly declaring his goal of becoming a radio talk-show host and toasting his newfound status as an adult.

"It's great to be able to legally do anything 24/7," says Piercey, running his fingers through a scraggly brown beard and ponytail. "I have a lot dreams and expectations."

Piercey isn't the only one with big hopes for his future. Today's businesses are eagerly courting the approximately 4 million Americans turning 21 this year as the vanguard of Generation Y, a group whose population is almost the same as the Baby Boomers' and is expected to be every bit as powerful as a shaper of business markets. While demographers debate its size - many define Gen Yers as those 72 million Americans born between 1977 and 1994 - there's little dispute about Y's spending power: an estimated $187 billion annually, destined for industries ranging from apparel to wireless tech.

Take that $187 billion, factor in the arc of career growth, household and family formation, and multiply by about another 53 years in life expectancy, and you're in the $10 trillion range in consumer spending over the life span of today's 21-year-olds. The generation of Echo Boomers - which put Happy Meals, Lunchables, Sonic the Hedgehog and Nickelodeon's Rugrats on the map as billion-dollar franchises - is crossing over from MTV's The Real World into the real world. Now that more than 20 percent of the cohort has reached the age of majority, what should we make of a generation peering into adulthood whose sensibilities were shaped by years of calm followed by days like Columbine and September 11, by years of economic exuberance followed by months and months of recession, and by years of world peace followed by weeks and weeks of wars whose end is nowhere in sight?

Flash back to about 1971, when the same number (16 million or so) and percentage (about 20 percent) of Baby Boomers had reached their 21st birthday. Business, politics, careers and culture would never be the same as young Boomers emerged from a cloud of idealism to assume the responsibilities, the privileges and the powers of adulthood.

That's where we are now with Gen Y's About-To-Be's. The attitudes of youth have begun evolving into the values that come with being a grown-up. History and culture's defining moments - Columbine, 9/11, the impeachment of President Clinton, the Dot Bust - have helped forge a sensibility that will last a lifetime in shaping expectations and entitlement, in determining what one will give to and take from society, work, one's community, etc.

As they start forming their own households, 21-year-olds will soon be shopping for their first cars, homes and mutual funds. They'll begin developing brand loyalties that could last a lifetime. But what sounds like a no-lose scenario for marketers, however, has many of them worried. This is the most unpredictable, advertising-saturated and marketing-skeptical group of adults America has ever seen.

Like many of his peers, Michael Piercey ignores traditional media and advertising channels. He prefers to play video games and watch DVDs than to sit down for scheduled TV shows. He'd rather read comic books than subscribe to a newspaper or magazine. And though he still crashes at his parents' house, he's more at home in a virtual world, spending six hours a day online, surfing Web sites of cartoon art and instant messaging his friends. "I guess I have 200 people on my buddy list," Piercey says. "One of my best friends is a guy from Milwaukee who I've never met. We both like comics."

You might think young Piercey is a consumer aberration, but marketers recognize that he looks more and more like the future. Today's 21-year-olds serve as the nation's key trendsetters, whose passion for MP3 players, camera phones and instant messaging is transforming popular culture. More than half of all 21-year-olds still live at home, so they still hold sway over their teenage brothers' and sisters' product preferences. These Echo Boomers also influence the tastes of their Baby Boomer parents, creating such a potentially powerful phenomenon that marketers are calling it the "Boom-Boom" effect.

Companies that ignore the tastes of today's 21-year-olds do so at their peril. If a brand missed the 21-year-olds of Gen X, it could survive because that audience was relatively small. Not so with Gen Y. These newly minted adults are the bellwether of what the nation's consumers will soon be doing, buying and thinking. And that's what keeps marketers up at night.

As automakers have already discovered, 21-year-olds are tough to please. When Honda tried to appeal to them with its Element, a boxy vehicle that company officials described as a "dorm room on wheels," young drivers yawned. Instead, Boomers latched onto the ads, which showed sexy college kids partying near the car at a beach; the average age of the Element driver is 42. The same thing happened when Chrysler unveiled its hearse-like PT Cruiser. Though the target market was the young, so many Boomer moms and dads were reminded of the hot rods of their youth that there were waiting lists at dealerships. Only 4 percent of the PT Cruiser's buyers are under 25.