South African millennials different from US millennials

Some US marketers have decided that grouping millennials together in a single group is a mistake – and a potentially expensive one, too. Redzone spoke to HDI Youth Marketeers managing director Jason Levin about whether South African millennials follow a pattern similar to the groupings proposed in an article posted late last year on brandchannel.com by Sheila Shayon.

“The most common segmentation used for millennials in South Africa is age, but it’s a blunt tool,” says Levin, adding that psychographic profiling is fairly uncommon in this segment in the local market. More common would be the distinction between various socioeconomic groups.

Shayon’s article quotes Max Knight, VP for marketing services at ad tech firm Turn, who has divided millennials internationally into four groups. He argues that millennials are not simply one monolithic block of people aged 18-35, but rather that each of the four groups is a highly specific audience, with its own motivations and opportunities for brands to connect with them.

Turn names the first group (57% of millennials) “Struggling Aspirationals”. They are described as green, healthy and fit but comparatively fiscally challenged, and open to promotions and limited-time offers. In South Africa, Levin says, the equivalent group would be the “Wannabees”; they are formally or informally employed, have some level of income and form the largest single segment of the market. They dream of getting out of the townships and save money for items such as handbags and shoes.

Turn’s “Comfortable TV Watchers” – 8% of the market – love watching TV and have specific interests that marketers can tap into. In South Africa, this group, approximately 25% of millennials, are what Levin calls the “Welfare Staters”: survivalists who just get by, but who have hope for a better life despite the fact that they all live off state social grants of some sort.

The “Active Affluent”, 17% of the international market, are generally new parents who love leisure travel and the outdoors. Our South African counterparts are the “I’ve Arriveds”, forming around the same percentage. They have a decent income, as well as homes (some owned and some rented) and children. They see this lifestyle as an achievement and status symbol.

Eighteen percent of the international market is defined by Turn as “Successful Homeowners”. They have the highest income among US millennials and are likely to own their own homes. According to Levin, there is no equivalent in the South African market. Forming the same percentage, however, would be the “Struggling Despondents”, a group of mostly rural millennials who have low confidence and poor prospects, and are also dubbed the “lost generation”.

While research in the US has revealed that marketers spend 500% more on millennials than on any other group – across platforms such as video, mobile, display and social – Levin points out that this is not the case locally. Local marketers, he says, are nervous about pleasing this group and the incorrect view that South Africa’s millennials have less money to spend than their international counterparts is fairly prevalent still. That said, he admits that this sentiment is starting to change, especially in industries such as telecommunications and financial services, where investment into this market is starting to pay off for the brands making it.

Clearly, South African millennials have their own unique traits and can’t be compared to millennials in other countries.

The big take-out: South African millennials should be divided into their own groups rather than international groupings – there is no “one size fits all” approach to grouping them.