By: Mikee Canaman
Over the years of study, the dividing lines between generations are becoming more refined suggesting a clear understanding of the characters and behaviours of each age group. The intervention of technology played a factor in this division, with millennials being the most studied and talked about.
Having been the first generation in history to grow up totally immersed in a world of digital technology, millennials, also known as Generation Y, Generation Me, Generation Rent and Digital Natives are transforming the perspective towards ownership. As how studies support, industries are locking into strategies that are slowly killing the traditional desire and need to possess the rights to something. And with millennials wanting life-long learning and being always on the move and in control, the shift to alternatives such as mobile homes, shared spaces, and subscription-based services are becoming more and more acceptable.
Millennials as Homeowners
The generations prior to millennials gave high emphasis on household-formation and homeownership. They married early, acquire properties and invested on long term commitments. Millennials, on the other hand, are more known as interest-driven, flexible, and ambitious that they marry late and opt for lesser children.
A report by the Urban Institute stressed that delayed marriage has the most significant impact on millennial homeownership. Although a large influence also comes from age, income, race, ethnicity, and education, this millennial state in owning home properties is driven by their diverse interests and desire for alternatives with shorter liabilities. Will Van Vactor, an attorney-writer specializing on real estate, also mentioned in his article on Buying a Mobile Home, how manufactured homes aside from urban rents are aligned to the millennial preference. In his article, he said “Mobile homes often have a lower-cost option in comparison to buying a stick built home. In this regard, mobile homes can make homeownership easier to achieve. And since mobile homes usually cost less per square foot than a stick built home, they can get more space for their money. Another advantage they find with mobile homes is flexibility. This is an option if they are uncertain if they want to own the land long term, do not want to commit to a stick built home now, or cannot afford a stick built home right now.”
Millennials as Entrepreneurs
Entrepreneurial styles of managers have evolved with the rise of millennial managers. A new generation of entrepreneurs coming from age 23 to 38 are starting more companies, managing bigger staffs, and targeting higher profits today than their predecessors. Although one of the major contributors to this trend is linked to technologies, it is also the change in the market environment that made the millennial become CEOs and owners of their company at a young age.
With the apparent shift of the business and its prime movers, countless strides have been made in building a system aimed at better business ideation and implementation. For Robert Mening, a digital educator-entrepreneur, millennials today have easier access to resources and venue for business. He emphasized how the digital generation is using e-commerce platforms, a piece of software that allows one to build a store and run a business. This platform even provides tools to create and manage the enterprise including products, logistics, and other day-to-day operations. With the platform being easier and more inexpensive to set up, traditional acquisition of space, products, and equipment becomes a secondary option for a millennial entrepreneur.
Parallel to advances in technology is the changing perspectives toward productivity, flexibility, and collaboration. The model of shared spaces has become more and more popular, driven by the choice of millennial freelancers, start-up entrepreneurs, and community-driven organizations. To Larry Alton, a business consultant, a shared office space or co-working space is an abstractly defined location where individuals from multiple businesses can engage in work. In many cases, members of a shared workspace will pay a monthly membership fee, almost like a gym, for regular access to the building, and premium charges for accommodations like meeting rooms or special equipment.
This millennial state in founding and owning a business suggests dependence on alternatives such as a shared space for having lower costs, fewer responsibilities, networking opportunities, and smaller commitments. This generation resists the traditional acquisition of office space, equipment, and liabilities.
Millennials as Consumers
The millennial consumers have driven businesses to transform its positioning on products, price and promotion. With this generation also known as poorer than their parents’, the pricing strategy, for a perfect example, evolved to a subscription basis to accommodate this market’s buying capacity and preference.
Subscription e-commerce is a fast-growing alternative to buying products and/or services online. A recent study on “Thinking Inside the Subscription Box” shows that 15 percent of online shoppers have signed up for one or more subscriptions to receive products on recurring basis, frequently through monthly boxes. This alternative to purchasing in stores and outright offers the consumers a convenient, personalized and cheaper option to buy what they want and need. This is the millennial state in owning a product or acquiring services. The millennial market desires to first try a service for a certain period of time, before fully investing on it, or avail with an open option for a change of mind.
Technology played a factor in the dividing lines between generations. The millennial stance on ownership was greatly influenced by the acknowledgment that people are living in an impermanent, ever-changing digital world. And whether this perspective on possession is a good thing or not, having millennials take over 75% of the market and the workforce in the next decade, businesses and organizations are ought to evolve to meet their preference.
Mikee Canaman is the Marketing and Communications Manager of FutureSmart Resources + Strategies Inc., an Asean company committed to bridge gaps through technological innovation and data-driven strategies. She is also a Global Shaper from Iloilo Hub, part of the Global Shapers Community — an initiative of the World Economic Forum.