The audacious new generation that is driving world brands
When asked what they would do if given some free Sh20,000 to spend within 24 hours, the responses from two young women — Ms Lavender Annete and Ms Ruth Omala — were specific, almost similar and came instantly.
“Not more than Sh2,500 would be spent on shoes, Sh5,000 on clothes, Sh4,000 on jewellery and the rest I will spend with my friends plus maybe a piece of art,” Ruth, 27, an office administrator in Nairobi, told Lifestyle.
And Lavender, 23, a fourth-year international relations student at the United States International University Africa, says: “I would go for a pair of shoes for Sh4,000, clothes at Jamia Mall (in Nairobi) for Sh6,000, make-up for Sh4,000. I am not a serious drinker but I would definitely buy a bottle of Jack Daniels (whisky).”
The two women represent a rising segment of tech-savvy, “disloyal” and hard-to-engage generation moving into its prime spending years. They know what they want when they land their hands on money and are forcing companies to re-examine how they do business the world over.
While there is no definitively established system of determining when generations change globally, there is general agreement among demographers about the existence of a number of generations. The silent generation was born between World War I (1914-1918) and World War II (1939-1945), the baby boomers between 1946-1964, Generation X born from the 1960s to 1986 and then Generation Y.
Millennials, whose definition is fluid but largely considered to be those born between 1986 and the year 2000, are not only disrupting how work places are managed but are also using their money to dominate the consumer market like never before.
Having grown up during the digital age, they are the most informed and demanding consumers yet and, by their sheer numbers, their combined buying power plus influence in the information sphere, are sending companies scrambling for their attention — and money.
Apart from turning the world upside down, opening new frontiers and causing brands enormous headaches, they have in effect forced companies to relook engagement methods and marketing strategies.
According to a recent article in Forbes magazine, by next year millennials worldwide will spend $200 billion (Sh20 trillion) and more than $20 trillion in their lifetimes, “which means they will have more purchasing power than any other generation before them and are thus bound to reshape the global economy”.
In Kenya, various demographic surveys place the median age to be about 19, which means most of the country is basically made up of millennials and the impact is already being felt across the business sphere and the larger economy. And marketers can no longer ignore them.
“Not only does this generation account for a huge percentage of the population but their buying power will grow,” says Mr Meshack Nyambane, the marketing officer at Masinde Muliro University of Science and Technology.
He adds: “The only problem is decisions in the retail industry are being made by people of the previous generations so there is a huge disconnect. The marketing rule book has to be changed so that retailers think like them, act like them and most importantly are trendsetters.”
Last Friday, Kenya Breweries Limited (KBL) launched Tusker Cider, which is being marketed as a “deliciously crisp, premium-crafted and refreshing alcoholic drink made from crushed apples.”
Just two weeks before, the company had rolled out Smirnoff Ice Electric Ginseng, a ready-to-drink alcoholic beverage available in silver, blue and orange accents that brought to four the number of such drinks the brewing giant has launched in recent years targeting millennials. Others are Snapp and Smirnoff Ice Guarana.
“Our ambition is to innovate constantly and at scale in order to address changing tastes and preferences across a diverse category of consumers in the Kenyan market,” KBL Marketing and Innovations Director Stephen O’Kelly told Lifesyle.
He explains that these consumers are increasingly exposed through digital media and are more travelled, discerning and eager to try new products.
“They currently comprise about 35 per cent of the population, according to Kenya National Bureau of Statistics.”
Not left behind in the all-out scramble for the millennials are big brands like mobile giant Safaricom, global soft drinks manufacturer Coca-Cola, Shell, Equity Bank and KCB. Some of them have been forced to change the way they interact with their consumers while at the same time creating products specifically targeting this important segment.
Last week, for example, Equity Bank launched Eazzy Pay and Eazzy App aimed at providing digital banking solutions with a promise to offer customers easy and comprehensive banking experiences to support their financial needs.
The new products are supposed to spur competition in an arena where there is “Bankika na KCB” and Co-operative Bank’s “Yea” among others.
And in May, Safaricom launched “Blaze”, a communication and empowerment platform that enables users to plan and control how much they spend on voice, data, and SMS each time they buy airtime.
The platform, which cost Sh700 million to conceptualise, develop and launch, will act as a sub-brand of Safaricom with its own SIM cards and only those aged between 10-26 years are allowed to subscribe. It was co-created with the target audience over the course of a year.
“When it comes to the younger population, their unique perspective of life inspires them to make new demands than any generation that came before them. This is why we have adopted a co-creation model for developing products on the Blaze Platform where we regularly consult our customers on the services they would like to see and use, and then we create them for them,” Sylvia Mulinge, the Director of Consumer Business at Safaricom, says.
She adds: “Our market research also found that younger customers prefer to engage directly with brands that have content that is directly relevant to their needs.”
This insight led to the creation of the Blaze Summits, where subscribers not only learn more about the brand, but also gain access to mentorship opportunities that will help them take advantage of business and employment opportunities.
The summits have so far been to major towns like Eldoret, Mombasa, Kisumu, Meru and Nairobi where the company enlisted mentors like Eric Muthomi (Stawi Foods CEO), Karis Mutweri (comedian), Patricia Kihoro (actress and radio personality) and rapper Kaka Sungura to mentor subscribers.
But it is Coca-Cola, which is one of the most globally recognisable brands, whose marketing strategy has in the recent past bent towards millennials.
In 2011, the company relaunched “Open Happiness,” a lofty, ideals-based campaign to promote everything from anti-bullying to peaceful co-existence to drive consumption. Then a couple of years ago there was “Share a Coke”, enabling consumers to get customised Coca-Cola cans and plastic bottles with their names on them. This became a hit in Kenya as it did all over the world. And, by using a personal approach, the company said “Share a Coke” led to an additional 25 million global Facebook fans and a two per cent annual increase in sales by the end of 2014, according to The Wall Street Journal.
But just like the millennials who are known for not staying on a particular trend for so long, the company recently launched a new campaign dubbed “Taste the Feeling”, which uses advertisements that use emotional storytelling depicting everyday moments like a first date and put Coca-Cola bottles right at the centre.
It is a campaign that ran into trouble and also signalled a gap between an older conservative generation and younger Kenyans.
The Kenya Film Classification Board took issue with the marketing campaign saying it had “caused a public outcry from viewers who complained about the offensive scenes involving kissing which violate family values”. In April, the company agreed to edit out scenes that offended the Kenyan audience.
Mr Nyambane of Masinde Muliro University’s marketing department says that the only way to appeal to millennials is by a company packaging its products as an experience and making them feel part of it.
“This group wants to consume on demand and in real time. Everything to them is an experience whether it is a product or a service and they like to engage with brands, and if they like or hate something, they go to Instagram, Facebook or Tweeter,” he says.
For example, on August 29, what started as a tweet from the Twitter handle @laitoriat saying “Snail in my salad yesterday at one of your restaurants” about his experience at an outlet belonging to Java Coffee House, led to a public relations nightmare after users on social media trolled the restaurant for days until it offered an apology.
In May, Vivo Energy, which runs the Shell franchise in Kenya, took action against its Ridgeways branch after a complaint on social media by someone fuelling at the station about possible electronic fraud went viral and piled pressure on the company.
“They have brought back the good old word-of-mouth advertising only this time it is through the internet and it is causing marketers a nightmare,” says Mr Nyambane, adding that there is no longer guarantee that big budget marketing will work. Instead, he says, there has to be a conscious effort to find ways of interacting with millennials.
Mr Lameque Kubania, 29, and Mr Peter Kigondu, 25, for example, say they do not trust advertisements.
“Some of them are misleading. If it (advertisement) comes in the middle of a programme (on TV) I will watch it but I won’t probably care,” says Mr Kubania, an office administrator in Nairobi.
For Mr Kigondu, a lawyer in Nakuru, what his peers say and a company’s approach to marketing are likely to influence his decision.
“I always check for reviews online and see what people are saying about a particular product before I buy it — the better if I feel the company selling it is talking to me,” he says.
More and more brands, it appears, are realising the importance of social media to drive their agenda and unconventional languages like Sheng are increasingly being used.
Last month, for example, KCB was declared winner in the financial services segment during the social media awards organised by OLX in Nairobi. The bank has been churning out memes and hilarious tweets.
One of its recent tweets in sheng says: “Vile tunawaangalia mkienda roadtrips na loans za KCB M-PESA hamjalipa (How we look at you when you go for road trips and you haven’t paid our KCB M-Pesa loans)” accompanied by a picture of mean looking cat peeping through a car window. This was widely shared.
By Friday, the tweet released on October 7 simultaneously on the bank’s social media pages had 34,000 likes on Facebook, 3,617 shares and over 3,000 responses. But it is the interactions to the post that offer a lesson on how brands should interact with millennials.
“KCB must be the coolest bank ever. Cheki vile wanadai wasee (see how they are demanding payment of loans),” quipped Sammy Kibui on Facebook.
“Zii mtu akichukua deni lazima alipe, hakuna njia ingine (No, anybody who takes a loan must pay it back),” responded the bank.
Brands have also latched onto trending topics on social media to advertise their products and interact with younger audiences freely.