Clive Humby: Passions are the best way to target the mythical ‘millennial’

‘Understanding millennials’ is just a rebranded way of saying ‘demographic segmentation’, which is inadequate to describe such a large a varied group. Combining their passions with life stage and life event data is the only way to target them accurately.


Despite millennials being the most public generation in history very few companies seem to have any real understanding of them, but at a time when the word ‘disruptive’ has become positive and some of the world’s most successful business minds are under the age of 30, demographics are simply not a good enough way of describing this audience.

A 28-year-old millennial could be a parent with two children, a student, still living at home with mum and dad, or the CEO of the latest must-have app. The variations in life stage, financial status and consumer habits are enormous, and therefore grouping all those between the ages of 20 and 40 together, simply because they can all be described as digital natives, is ineffective and short-sighted.

READ MORE: Mark Ritson – Millennials are out; blah blahs are your next target group

Some brands have understood this, and are reaping the rewards. In April, Netflix caused a stir by announcing that demographics belonged in the garbage when it came to predicting TV preferences, and that clustering audiences based on their tastes is far more effective. The same can be said for almost all industries.

Typically, age has been used, along with location, as a proxy for estimating a person’s wealth, disposable income and priorities. This was cutting edge in the 1980s with the development of geo-demographics but today it is an obsolete way of understanding customers and audiences.

The digital footprint left by customers allows companies to skip this middle step and focus on the actual questions they want to answer. The combination of life stage, life event and ‘passion profile’ of an audience is the key to understanding how they fit with a brand, and how a brand may fit with an audience.

The first of these categories, life stage, refers to the semi-permanent state of a person’s life. This can be if the individual is in school, a working professional, retired, a parent or a homeowner. This information is usually indicative of the day-to-day spending habits of a person, along with their priorities and routine activities. This background to a person gives context to their behaviour and clues to their attitudes.

The next component in understanding an audience is life events. These are large, one-off occasions that are disruptive to the status quo, and may have large implications for a person’s life – getting married, having a baby, getting a new job, going travelling or moving house. Whether it is targeting someone with the right offer for swimming trunks before a holiday, or enticing newlyweds to an exotic honeymoon location, identifying when one of these high-spend opportunities is occurring can mean big business.

Moreover, if one of these life events is a transition between life stages, this can present the chance to become a trusted brand for the new chapter in someone’s life. The ability to detect these using the huge amounts of real-time data people put on social media is invaluable.

The final ingredient in building a full picture of a person is to know their passion profile. These passions are often the ones saved for one off treat purchases, such as a motorbike, ticket to a gig or expensive camera. For brands, it is unlikely you will be able to gather much transactional data for these purchases, and to predict if a person may be interested in your product you must look to their passions to get a full picture.

The combination of these three metrics – life stage, life event and passion profile – is the key to understanding an audience. Instead of brands and retailers creating vague strategies aimed at the mythical millennials, they would be far better off examining their current audience, the market and both internal and external product offerings, and then creating strategies that are targeted at those who are existing or potential customers.

For brands to understand the audience as a whole, they must understand the varying people within it, so they can create strategies to reach the relevant audience. For example, our analysis of UK millennials’ favourite brands, media titles and celebrities suggests women in the UK can be grouped into nine different mindsets including ‘music lovers’, ‘celebrity stalkers’, ‘fashionistas’ and ‘fitness conscious’, while men have nine including ‘petrol heads’, ‘current affairs curators’, ‘sports mad lads’ and ‘LGBT activists’. However, the numbers change again when looking at an American audience. In the US we see 14 different female segments, while men have 11.

Never have customers expected a more personalised service, and grouping huge audiences together based purely on age risks isolating many without appealing personally to any. The key to understanding millennials lies not in what unites them, such as their age, but what differentiates them from one another.

Clive Humby was co-founder of Dunnhumby, and is chief data scientist at customer data insight company Starcount.



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