Millennials and GenZ vibe with differentiated brands
PremiumThe search for cooler products and services goes beyond hospitality and travel
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PremiumIndia’s premier hospitality group, Oberoi Hotels & Resorts, said that it is open to looking at launching newer hotel brands for younger customers. In a recent chat with Mint, the group’s newly appointed president, Sanjiv Kapoor, said that the company will look into adjusting the customer value proposition of its existing brands (Oberoi, Trident and Vilas) too because consumer demographics are changing. A new generation of corporate leaders is emerging with a different set of needs and preferences.
Additionally, the group could explore potential new lifestyle segments as there is a reluctance among the younger lot to be associated with any known brand. They want their brands to be supercool and exclusive.
Older hotel guests may want to order room service at night after a tiring day; millennials and GenZ consumers want to get out and socialize and not have meals in the room. Globally, some new hotel brands have done away with room service, but created lobbies that are like networking hubs with mood lighting and music.
“We need to make sure we have something that appeals to them. There is no one size fits all. That concept has started to go away and we will become even more differentiated across industries and not just in hotels," Kapoor said.
The demography of the business-class traveller in airlines has changed, too, he pointed out. The traditional business-class passenger shudders at the sight of millennials travelling in shorts and sneakers. “However, these are owners of unicorns… they are looking for different experiences. They have the money to spend," Kapoor explained. It is for these customers that differentiated hotels may come up “with a cooler experience, but more luxurious".
The search for cooler products and services goes beyond hospitality and travel. The proliferation of direct-to-consumer (D2C) or internet-first brands across categories such as apparel, beauty and personal care is another example of what the new-age consumer is looking for.
An expert who helps drive growth for D2C brands agreed with Kapoor that millennials and GenZ are not interested in brands used by their parents. Traditional fast-moving consumer goods (FMCG) brands popular among older cohorts are not seeing similar penetration among the young, he explained.
“If you look at the 40-60 years age group where a brand holds 60% market share, and if you go to the 20-30 years age group, it may have barely 20% market share. The rest is captured by a bunch of new brands that have come up," explained Mangesh Panditrao, co-founder, Shoptimize, in an earlier chat with Mint. What these consumers are looking for in terms of product, pricing and messaging is very different from what traditional FMCG brands offer.
The standout trait among young consumers in terms of their purchase habits is that they are more confident, explorative and experimentative and look for an immersive experience, said Amit Adarkar, chief executive, Ipsos India.
Millennial/GenZ consumers are comfortable with technology and are active participants of the shared economy. This cohort also finds higher credibility with sources of customized or pulled information (via social friends, networks, influencers) instead of sources of mass disseminated push information (print, television). “D2C brands are able to leverage this very well. I don’t think new millennial/ GenZ consumers’ acceptance of D2C brands is a statement of rebellion against using their parents’ brands. The proposition and delivery of D2C brands just vibes more with these consumers," he said.
The pandemic has changed millennial/GenZ consumers, making them more conscious of personal health and well-being, as well as the environment. This does not mean that they will be automatically drawn to sustainable or organic brands. However, here too, D2C brands hold an advantage because of higher message credibility through social influencers, he said.
With a year of being closeted because of the pandemic, young consumers are actively looking for new experiences and explorations.
“Our research shows that millennial/GenZ consumers have ‘travel around the world/country’ as one of their top priorities after the pandemic. The startup ecosystem is abuzz with the possibilities of sharply positioned hospitality brands. To me, the clincher will be to create Airbnb-like communal, hi-tech experiences to attract this cohort," Adarkar said.
Shuchi Bansal is Mint’s media, marketing and advertising editor. Ordinary Post will look at pre-ssing issues related to all three. Or just fun stuff.
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