When it comes to tech products, Gen Y consumers tend to contradict themselves. We want a continuously expanding, cutting edge product line with advanced features and the ability for limitless customization. But from the very same products, this demographic demands extreme simplicity. Yes, it’s madness - however companies that can achieve the delicate balance of innovation + simplicity in product design will have young shoppers flocking to their stores.

Real World Example: The Future Microsoft

Microsoft has had issues with the innovation/simplicity blend in the past, and Apple capitalized on this factor with their infamous “Switch” ad campaign. Gen Yers began switching from Microsoft products to sleeker, easier-to-use Apple products.

But Microsoft knows why this is going on. They need to be the innovator again, and the company’s products must work together seamlessly if they want to crack the Gen Y market. Just as companies are accepting new ‘norms to retain Gen Y employees, Microsoft is learning to embrace the lifestyles and desires of their 20-something target market. Microsoft isn’t quite there yet, but they are on the right track.

This video shows Microsoft’s vision for their future in the youth market. It is a perfect example of how Millennials want technology to fit seamlessly into their lives. The title is fitting: it is called “Your Digital Lifestyle.”

Video: Your Digital Lifestyle

The Hottest (Youth) Mobile Phone Brand Always Stays Ahead of the Curve

Nokia has gotten it right with Gen Y from the start. They were the first mobile phone manufacturer to capitalize on this age group’s desire to customize and personalize their experience with the product. Nokia phones with interchangeable faceplates were so popular among teens throughout the 1990s because young people could finally make their phone cool and unique - fulfilling a strong urge to differentiate theirs from the dull, gray phones owned by their parents.

In 2008, Nokia is still a brand that resonates with Gen Y. But marketing to a younger audience is no longer about custom accessories. Young buyers nowadays want to customize and control their own content. They don’t care as much about the physical device - they just care about what they can create and who they can communicate with. Because of this, Nokia is embarking on fresh campaigns to market their new N-series line of phones.

Advertising the Nokia N-series: Telling isn’t Selling

The N-series is a clean, cutting edge line of phones, which would typically be promoted by showcasing the product’s sexy design and full-fledged feature set in advertisements. BlackBerrys are promoted in this manner and it works for them - because their target demographic is the 30-50 year old market. But this promotional style will only cause Gen-Yers to press the commercial skip button on their TiVo.

Product-focused and feature-based advertising rarely grabs the attention of a Gen-Yer. Advertisers don’t need to list out product features for us; we can learn about those online if we really want to. Don’t tell me what your product can do - show me the experience I could have with it. Nokia gets this concept, and their recent marketing initiative for the new N-series is an excellent example of marketing that Gen Y will pay attention to.

So how is Nokia reaching Gen Y? Here are the details:

• Nokia sponsored the Cannes Young Lions Film Festival, an international film competition for advertising professionals under the age of 29.
• They give each team an N-series phone which has video capture and editing capabilities built-in.
• Teams have 48 hours to shoot and edit a 60-second commercial, all done with the Nokia phone.

The Cannes Young Lions Film Festival = Perfect Product Placement for Nokia

The result: teams of young people from all over the world created their own commercials using Nokia phones. The company is creating buzz by tapping into this age group’s primal desire to create, publish, and share content that is relevant to them. And it is working - the videos are unique and creative, and all of them show the N-series phones in action (without showing the phones at all). The entry from Team Italy (vid below) is my favorite.

Learning from Nokia - How You Can Reach Gen Y

For businesses that want to make meaningful connections with Generation Y, there are 2 key takeaways to consider that lead Nokia to success with their recent N-series marketing campaign:

1. By inviting teams from around the world to participate in the Cannes Young Lions festival, Nokia is building a reputation as a brand and company with a world view. Gen Y studies abroad, has friends living abroad, and has generally grown up in a culture that appreciates diversity. These factors cause Generation Y to weigh a company’s global actions (positive or negative) more heavily than others when making purchasing decisions.
2. Nokia gave their users control of the content by asking them to create advertisements. The logic behind this is simple: if you are trying to reach the Gen Y demographic, why should anyone other than a Gen-Yer design your ads?

While many American businesses and consumers are stretching their budgets to the breaking point just to fund their cars, a company with a brilliant business model has found a way to adapt through renting cars by the hour. The company is Zipcar, and they have been incredibly successful in targeting and connecting with Generation Y drivers.

Carsharing 101

Living in the city and owning a car is a painful experience, both financially and logistically - especially when you are young and on a tighter budget. AAA now estimates the average cost of car ownership will be $8,121 for 2008. $676.75 a month? There has to be a better way to get around! This is where Zipcar comes in.

The Zipcar concept: If you live in or near a major city with public transportation available, ditch your car and engage in carsharing instead. Use public transportation, cycling, or your own two feet to commute back and forth to work. When you do need a car for going on weekly grocery store trips or driving out to visit a friend in the suburbs, rent a Zipcar by the hour. It’s easy - Zipcar includes gas, maintenance, parking and insurance. The cost to rent an average ZipCar? About $8.50/hour after a $50 annual membership fee.

This clean, simple, and affordablepricing structure is of particular appeal to the cost-conscious Gen-Yer. But this isn’t just about price…accessibility, green benefits and cool cars help seal the deal with young consumers.

18-to-25 Drivers: An Untouched Segment!

A few years ago, Zipcar made a very smart move by working with colleges around the country to park Zipcars on campuses for students to use. For a long time, the car rental industry has made it nearly impossible for college kids to rent cars. Even recent college graduates are excluded from most rental companies’ minimum rental age of 25.

ZipCar has done the opposite, however, by making their program available to anyone 21+. In early ‘08 they broadened their reach even further by lowering their minimum age to 18 for most college students.

And guess what…it is working like magic. Young people are flocking to use Zipcars while in college, and that makes this service one that they are likely to continue using after graduation as well. In a recent INC Magazine interview, Zipcar CEO Scott Griffith emphasized the importance of young consumers in building the company’s brand, stating: “We’re taking a page from the Apple playbook, really creating awareness early on.” INC Mag goes on to note that 2/3 of Zipcar’s 180,000 members are under 35.

Spreading Buzz; Building Evangelists

Could Zipcar reach their target audience of young urbanites through traditional marketing methods such as TV advertising? Not a chance. This company has followed the likes of other cult brands (like Apple and Ikea) by creating a product/service that comes with a network of others that share a common philosophy. Zipcar is not just about renting cars…there is an entire community that comes along with every membership.

Most companies that try to build a community of Gen Y evangelists around their brand fail quickly. Here is how Zipcar has made it happen:

• Designing a truly cool product that is better for the environment and the local community - two values that are extremely important to Generation Y.
• Hiring the brand’s biggest fans to promote it (authentically) to their peers
• Ensuring nationwide consistency in service, but very local, customized marketing that fits the vibe of each neighborhood.
• Hosting great local parties to get Zipcar members together.
• Listening to what their customers are saying online, such as when they refunded this blogger after he rented a Zipcar to give New Yorkers free rides during a transit strike (see comment #11).
• And instead of producing professional TV ads, they encourage Zipsters to create their own commercials to post online. This one from a Chicagoan tells it all:

These unique efforts to target and build the brand with Gen Y have proven to be incredibly successful for Zipcar. Their timing is also spot-on, as there is an increasing demand for carsharing as fuel prices go through the roof. It is becoming easier to see why Gen Y is choosing Zipcar in record numbers instead of owning a car.

Yet even as they grow, this company continues to connect with their customers in a personal and meaningful way. How would I know? It worked on me when I joined last month. I am one of their many evangelists - not paid or sponsored at all by the company, but so genuinely thrilled about this service that I want to spread the word.

Harnessing Word-of-Mouth with Gen Y

Implementing Zipcar-style grassroots and WOM marketing is one of the most challenging, yet most effective ways to build your brand with Generation Y. With more than 70 million members in Gen Y, Zipcar realizes that this is a group worth targeting. Smart companies understand that as a group we are incredibly social and quick to tell our peers about the brands we really love.

Gen Y’s buzz-spreading ability is a key business builder behind the scenes at zipcar, and it is evidently working well for them - 40% of new Zipcar members are referred by their friends.

The following 1 hour discussion panel brings you a cross-section of 6 Gen Yers, ranging from age 16-24. This fascinating group discussion is moderated by Guy Kawasaki — a veteran silicon valley venture capitalist — and provides an inside view of how Millennials integrate technology into their everyday lives. The panel was held in late 2006, but I feel that it is still quite valuable. If you wish to jump ahead in the video, I have provided key talking points and their corresponding times below. Enjoy!

Talking Points

• Introducing the panel 02:55

• What are your uses of cellphones vs. landlines? 05:44

• What is your use of MySpace? 12:36

• How do you pay for things online? 21:39

• Do you watch TV anymore? 27:34

• What are your general uses of computers? 34:15

• How can advertisers reach young people? 40:16

• What gadget/service do you wish you had? 55:05

• For further insight on this panel, take a look at Guy Kawasaki’s blog post, “Is Advertising Dead?“