When it comes to Millennials, focus on the HENRYs

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Mar 09, 2018
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The Wise Marketing Staff

Through a special arrangement, presented here for discussion is a summary of a current article from The Wise Marketer, a website and newsletter serving the global loyalty industry.

Marketers need to stop treating Millennials — who range from college co-eds to minivan driving parents — all the same, argues Maritz Motivation Solutions in a new report.

Covering an estimated 80 million individuals born between 1981 and 1999, Millennials are the most diverse generation of economic significance in the U.S., the report states.

“The media likes to represent all Millennials as carefree and entitled wanderers, fixated on social media and just beginning to dip their toes into the workforce,” Maritz Motivation wrote in the report. “But subscribing to that notion can be very dangerous for any company who wants to be relevant to this demographic five years from now.”

Maritz Motivation believes the secret to effectively leveraging this generation of consumers lies in targeting one specific group. They are known as the HENRYs: “High Earner, Not Rich Yet.” A HENRY is defined as: “a household under 55 years old with an annual income between $100,000 and $250,000, but that has not amassed investable assets of $1 million.”

While HENRYs technically span three generations, Millennial HENRYs are where brands need to focus on building out loyal customers for two core reasons:

  1. They have a significantly higher budget for discretionary spending than Gen X or Baby Boomer HENRYs.
  2. Young HENRYs are the most likely to become a brand’s most valuable customers, both in terms of money spent and influence given over their lifetimes.

Among the advice Maritz Motivation gave for connecting with HENRYS:

  • Focus on experiences: Tap into their sense of adventure. Your brand doesn’t need to offer the experience itself, but showcase your products elevating an experience or making it easier to attain.
  • Leverage scarcity: HENRYs love being “in the know,” and when they see novel content, they are more likely to share within their sphere of influence.
  • Keep communications simple: Growing up on the internet, they expect to find instant answers to whatever they are looking for.
  • Be available 24/7: Half of Millennials spend over three hours a day on their smart phone, so make sure you are meeting them where they are — on their phones. 

DISCUSSION QUESTIONS: Should brands and retailers target sub-segments of Millennials rather than the entire generation? What are the pros and cons of targeting potential high earners or spenders within a generation? What lessons should marketers take away from trying to appeal to the broad Boomer segment over the years?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Look beyond the easy numbers into the data. I think there are interesting insights to be gained."
"It’s not just the broad segments of Millennials that are part of the HENRY categories; other generations are part of this group as well."
"Marketing to an entire age demographic segment is not an effective strategy, as consumer preferences vary widely within age groups."

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17 Comments on "When it comes to Millennials, focus on the HENRYs"


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Max Goldberg
Guest

Brands and retailers should always target subsets of demographic groups, whether Millennials or Boomers. One size does not fit all in terms of marketing strategies, products or retail selection. Retailers should focus on who they want to drive into their physical and online stores and then where and how to reach those folks. Be laser-focused. Pay attention to subsets. And as the article suggests, be there 24/7.

Paula Rosenblum
BrainTrust
Hah! I keep waiting to move beyond being a HENRY. Still hasn’t happened, probably never will. This is one of my pet peeves, treating an entire generation as a homogeneous clump. It is certainly not true of Boomers (just look at the election results last year!) and it’s not true of Millennials either. Taking it a step further, it’s not wise to treat Hispanics as a homogeneous clump either. I live in Miami. There are more than a few Hispanics here…but they are most definitely not all the same. Venezuelans are very different than Cubans, who are very different from Puerto Ricans or Mexicans. And their tastes are really, really different in clothes and in home furnishings (among others). You know, we ought to start using machine learning and AI to create better sub-markets that cross generations. Yes, Millennials are entering their highest discretionary spending years and are setting up house for the first time (ever seen a Rocket Mortgage commercial?). But in fact, Boomers who might be retiring are ALSO setting up new homes,… Read more »
David Weinand
BrainTrust

There you have it Paula — develop an AI based solution to break down sub-segments of generational cohorts and you’ll be out of the HENRY stage in no time!

Dave Bruno
BrainTrust

While I appreciate the insights into “HENRYs” provided here, there is really no question that marketers need to focus on subsets of an 80 million-person generation. Certainly HENRYs will be attractive to many, but there are virtually countless other ways to segment this fascinating generation. The more finely you are able to document your customers’ interests, tastes, budgets and aspirations, the better you will be able to develop assortments and experiences that align to your key segments, be they HENRYs or not.

Lyle Bunn (Ph.D. Hon)
Guest

It is such a marketer’s dream to consider only the highest level of demographic. That road narrows quickly and the ditches are wide on both side. We have tools available to us for customer analysis that the pioneers of marketing could have ever dreamed of; not to imply that this is to go to a gun fight with a knife in-hand.

Ralph Jacobson
BrainTrust

FINALLY! Someone feels my pain. How many times have I posted in this forum that Millennials are not all alike?! You MUST dig deeper to get real insights into individual behavior. If anything, Boomers are more alike than Millennials are. Tons of younger people act like Boomers, actually. Personalization is what we’ve talked about for years. Not mass customization, but real-time personalization. That is critical today to differentiate your brand.

Evan Snively
BrainTrust

Agreed on individual behavior. Despite what segment a consumer might look like on the surface, their behavior is king. An ideal scenario is having an infrastructure which is not only able to personalize, but also evaluate real-time whether the implemented personalization is achieving the desired effect and if not — being nimble enough to adjust the strategy accordingly. Easier said than done (and not easy to say!).

Ralph Jacobson
BrainTrust

Agreed, Evan!

Michael Spencer
Guest

Correction to this text, Millennials end at 1995 where Gen Z begins. We’ve moved far beyond these definitions of how to attract the new consumer. Indebted Millennials are discount natives that hustle and live for the most part paycheck to paycheck — how absurd to think of them as a HENRY.

Brandon Rael
BrainTrust

It’s not just the broad segments of Millennials that are part of the HENRY categories; other generations are part of this group as well. There are very broad generalizations made about Millennials these days, and it has even extended over to Generation Z, who are very mistakenly blended in as an extension of the Millennial mindset.

Segmentation and sub-categorization are key to really taking an insight-driven, deeper dive into the variety of folks within the Millennial generation or any other generational group. Retailers and brands would be very mistaken to just establish broad-stroke Millennial social media, advertising and branding strategies.

Mel Kleiman
BrainTrust

In today’s world dealing with a generation you need to market to broad generational groups but, in reality, manage to sell to individuals. Once you have a person’s attention the you need to treat them as a unique individual.

Richard J. George, Ph.D.
BrainTrust

I’m not wanting to comment on the HENRY segment as others have already addressed this issue. I conducted three national surveys of Millennials in 2009, 2012 and 2015. I found three distinctive subsets, which I labeled youngest, middle, mature. Creative names!

Not surprisingly, I discovered significant differences in attitudes and behaviors. Without going into detail on the differences, although I am not a gun enthusiast, suffice it to say we need to metaphorically put down the shotguns and pick up the rifles.

Ken Morris
BrainTrust

Marketing to an entire age demographic segment is not an effective strategy, as consumer preferences vary widely within age groups. A one-size-fits-all approach does not work. Segmenting customers based on Life Time Value (LTV), income, lifestyle and interests is a better approach that will yield better marketing results.

Ideally, we should be segmenting based on individuals — segments or markets of one. With big data and AI, it will be possible to customize marketing and promotions that are relevant to each individual. HENRYs and real-time retail to me is marketing and, in turn, sales nirvana. We will get there some day!

James Tenser
BrainTrust
The cohort labeled Millennials is another “pig in a python” — the term created by author Landon Y. Jones in 1980 to describe the demographic impact of the Baby Boomers. Both cohorts are numerically large and economically and behaviorally diverse, so it’s imperative for marketers to avoid generalizing about them too broadly. I had the privilege of interviewing Mr. Jones in 2006 while researching articles about the Boomers for Advertising Age and we discussed the clear distinction between cohort members in the leading half of the bulge, versus those in the trailing half of the bulge. Their economic success and resultant world views differed for a variety of reasons, some related to their macroeconomic impact. Spoiler alert: Leading Boomers prospered more than Trailing Boomers. Millennials are Boomers’ offspring, and they are a slightly larger group numerically. Their cumulative economic impact is catnip to mass marketers, but it’s self-evident that they too differ by age, lifestyle, education and other attributes. If anything, this group is more fragmented and diverse due in part to the fragmentation of… Read more »
Craig Sundstrom
Guest

Who and how one targets depends almost entirely on what one sells … this seems like a very basic lesson that’s learned in a the first week of a beginning marketing class.

As for targeting high earners — I wonder how long it took to come up with this latest acronym — that’s an obvious strategy, but hardly the only one. Just ask Sam Walton.

Jeff Miller
Guest

The first part of the question is a bit silly. Marketers should of course target sub-segments and focus on the ones that are in the brands target market. The hard part of the question is what takeaways from Boomer or even Gen X marketing should we apply to this and future generations. The tool and messaging used to communicate to Boomers (TV, print, etc.) have radically changed and what was once a one-way stream of marketing is now an ongoing and ever changing conversation.

Mike Osorio
BrainTrust

First, this is fairly basic “marketing 101” advice. Market segmentation is important for any marketing spending to ensure content and messaging methodology are relevant for the targeted consumer. Second, the advice to specifically target HENRYs is only valid for those brands and retailers targeting that segment, although it is arguably important for most.

wpDiscuz
Braintrust
"Look beyond the easy numbers into the data. I think there are interesting insights to be gained."
"It’s not just the broad segments of Millennials that are part of the HENRY categories; other generations are part of this group as well."
"Marketing to an entire age demographic segment is not an effective strategy, as consumer preferences vary widely within age groups."

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