By Charlotte Westerhaus-Renfrow
Your company’s ethics are more important than ever
While we may hate to admit it, this is often true: we are a culture that is obsessed with material wealth.
Back in the 1980’s, I envisioned wealth from watching the TV show, "Lifestyles of the Rich and Famous," hosted by Robin Leach. His famous catchphrase from the show was "Champagne wishes and caviar dreams!"
Today, we are still fascinated with watching and reading about people we believe are living luxurious and extravagant lifestyles. For example, “Keeping Up with the Kardashians” is not only one of TV’s most successful reality shows but has also become a way for many in America to perceive wealth. After all, wealth is associated with winners and everybody loves a winner, right?
If this is the case, then those who are obsessed with people with money should perhaps shift their attention to the richest group in the world. In case you haven’t noticed, Baby Boomers, born roughly between the years of 1946 and 1964, are the largest and wealthiest generation in U.S. history and collectively hold a staggering $30 trillion in assets.
But not for long. A large segment of Baby Boomers turned 65 in 2011. The oldest boomers are now more than 70 years old and the rest of the pack is not getting any younger. Albeit, if you are a delusional baby boomer, you may be tempted to proclaim that “70 is the new 20.” Baby Boomers, however, inevitably face the reality that no matter how many material possessions or material wealth they obtain, “you can’t take it with you.”
Now, Millennials – born between 1980 and mid-2000s – are the largest generation in the U.S. Collectively, there are 80 million Millennials. According to Pew Research Social and Demographic Trends, Millennials are collaborative, and more ethnically and racially diverse than older generations.
Transfer of Wealth
Wealth alert! Market trends indicate that Millennials are the new shopping kings and queens. They account for a third of U.S. retail sales and by 2020, researchers at Accenture forecast that Millennials’ spending will grow to $1.4 trillion annually. In addition, according to Digitas’ study, because they are a well-educated generation, Millenials are expected to earn $200,000 a year or more in the next 10 years.
Most significantly, Millennials will soon become an economic power to be reckoned with because they will inherit the largest transfer of wealth from Baby Boomers that has ever occurred in monetary history. Not to mention that the Millennial consumer cohort is currently smack in the middle its prime spending years.
No wonder Millennials are a massive target for companies who want a piece of action. Savvy large and small businesses are fascinated with the buying decisions of Millennials and actively seek effective methods to successfully attract and retain more millennial clients and customers. The key question is this: How are more affluent Millennials going to behave as consumers and spend their money?
Positive Social Impact
Here is one key indicator: in 2015, Nielson’s Global Corporate Sustainability Report indicated that 73% of surveyed Millennials want to buy products from companies that practice business sustainably and ethically. Moreover, 81% of Millennials expect their favorite companies to market in a socially responsible way.
Now, this not to say that Millennials turn away from purchasing and investing in companies that aim to turn a tidy profit. Millennials’ conception of wealth, however, is different than Baby Boomers’. According to a 2014 study conducted by the Executive Office of the White House’s Council of Economic Advisors, Millennials hold several core values that are like Baby Boomers’: “They want to be successful, and they want the type of prosperity that means that their children will be better off.” When it comes to work, however, Millennials want ample time “to make a positive social impact on their own children and communities, as well as on society as a whole.”
Market research from Bentley’s PreparedU Project found that 86 percent of Millennials agree that it is a “priority for me to work for companies that are socially responsible and ethical.” Subsequently, Millennials vote with their wallets by purchasing and investing more heavily in businesses that pursue not only the goal of increased revenues, but also the goal of community and societal betterment and the highest principles of ethical conduct.
To encourage Millennials to patronize your business, here are some business practices that can enhance their commitment to your business or organization.
- Do good. One of the best ways to resonate ethical standards with Millennials is to proactively support community engagement activities that advance the public good. Millennials grew up as high school and college students volunteering and working to increase the well-being of their communities, and consequently, being socially conscious is a part of their core belief system. Social and ethical responsibility and ongoing associations and commitments to social and environmental causes are integral in building a positive image in attracting Millennials to your business.
- Have an active ethical purpose. In a 2018 study conducted by Kantar Consulting, nearly two-thirds of Millennials expressed a preference for brands that have a point of view and stand for something. But remember, ethics and social responsibility can’t be just platitudes or lofty mission statements prominently featured on corporate websites or thrown around business boardrooms. Rather, shape your business ethics as a proactive approach that encompasses proactive actions and not just words. Millennials will be excited to follow your company if they see it as a hero that does more than “talk the talk,” but rather “walks the walk.”
- Showcase compelling stories of action. Millennials do extensive research before buying a product and can see through over-the-top marketing messages. The same goes for Millennials ability to ascertain if your business uses suppliers who engage in environmentally-unfriendly practices or who support causes that are harmful. Instead, be clear to position your company’s priorities, good works and purpose in compelling real examples and stories.
In sum, Millennials will soon be absolutely dripping with incredible buying power. Generational change will affect how Millennial consumers behave and they are a potent financial force. Thus, Millennials can spur your business growth and performance if they believe your company is ethically and actively contributing to the well-being of the community and others.