Into the Cold

By Scott Gerschwer

Out of College, Money Spent

See no future, pay no rent

All the money’s gone

Nowhere to go…

--The Beatles

There’s never been a graduating class quite like this; one that’s leaving the warm cozy confines of college to face the cold harsh realities of the business world. After all, college was a privilege of the rich few during the Great Depression. This is unprecedented. Here are some of the challenges this graduating class now faces:

• Another 345 thousand jobs were lost in May, raising the number of the unemployed to over 14.5 million souls; the unemployment rate is now nearly 9.5 percent.
• Talk about starting out behind the eight-ball. Their share of the national debt: $186,717 per person.
• 66 percent of four-year college grads leave school in debt.
• The cost of going to graduate school increased. Public college tuition is up 6.4 percent from last year. Private school tuition costs went up 5.9 percent.
• Only 20 percent of graduates who've applied for jobs got one (down from 51 percent in 2007).
• As a nation, we don’t make anything anymore. Barely 12 percent of the GDP comes from the manufacturing sector.

This past semester, my Interpersonal Communication class watched The Graduate. We all got a big laugh when the guy grabs Dustin Hoffman and says, “Plastics.” It led to a discussion about what single word one would give as advice today. For example, in my day it was “computers.” For a 2009 grad, I’d use three words: “marketing in China.”

While the near-term outlook isn’t great, I can’t think of a group that could be better-equipped to handle this kind of adversity than this generation, variously called Gen Y or millenials. There are more than a couple of reasons for the level of engagement and caring that is characteristic of this generation, most prominently, a general sense of disgust at the waste and mendacity of the Bush Administration they grew up under. And forgive me if you’ve read it here before, but from what I have experienced as a college professor, this generation has a better value system than the groups I taught in the 1980s and 1990s in terms of optimism, dedication to helping others, environmentalism and so much more.

For example, my students today, for the most part, don’t cheat. Not on exams, not on one another, not on themselves. They strive to be truly helpful to one another. Referrals are a passion of theirs. Word of mouth is the best way to reach them.

Whoops—there’s the marketer in me. But it’s true. They don’t like advertising—ads on Google and Facebook are a waste of money. But they love to share scoops. This is a generation of born Buzz Agents. They spend time on Facebook giving one another advice on everything from interpersonal relationships to what kind of jeans to buy. No new, cool pair of shoes is so trivial as to not warrant a txt message.

Here are some factoids from a not very scientific survey by New York magazine. The sample size is too small to be valid but the results are similar to what I’ve seen from more robust and well-conducted surveys.

• 39 percent watch TV on the computer.
• 35 percent watch TV live.
• 26 percent DVR it.

Television ads are of no use to this generation. They watch more TV on Hulu than they do on those widescreens that their parents bought for them last Christmas. Traditional advertisers are struggling with this. Write this down: NO ADVERTISING.

• 50 percent of them read a newspaper daily.

That’s a surprise. Of course they may read them online, but they read them. I have found that the media assaulted young people a few years back for not being able to identify the Speaker of the House or even know what the job entails largely worked. Things are different now. Maybe it was the Obama/McCain election that engaged them. Whatever the cause, this graduating class is better informed than the one that couldn’t identify Dennis Hastert (maybe it’s Nancy Pelosi that engaged them?) The ‘09 grad is more engaged politically than the ‘08 or ‘07 grad was. And that’s a good thing for the world. 

• 100 percent have cell phones; and
• 44 percent of them read messages (text and email) instantly upon receipt.
• 32 percent check “frequently”
• 19 percent check a few times per day 

SMS communication, anyone? But there’s a catch: that “hate marketing” resistance. Send them a txt message that is nakedly for marketing and they’ll delete it without a glance. But find a way to engage them and you have a great vehicle. For example, put out regular tweets advertising a special sale: attract the first few followers (those who regularly visit your store) and they will do the rest for you virally.

Twitter has 22 million subscribers. About half of them are between 17 and 30 years of age. A lot of attention has been paid lately as to how young people, perhaps turned off by the huge increase in older subscribers, have left Facebook and Twitter to find the next new thing. But if the marketers deign to give real value through these channels, the audience will return.

Facebook has over 200 million subscribers. Millenials account for over 50 percent of the total subscribers. While the number of college students has dropped over the past year (from 53 percent to 40 percent) it is clear that social media marketing has a huge audience. But it’s not a place for advertising. See above: NO ADVERTISING. Traditional advertisers are struggling with this. If you have to advertise to this group, try coupons and “insider” sales on Twitter that give real value. Unless you are Abercrombie or Hollister, these tactics will work better than brand marketing. 

The friendly, share-everything nature of young people lends itself to viral marketing (if you need proof check out the MC Hammer dance video on YouTube, which got great reach from viral expansion for the A&E Network). As I wrote in my last column, Twitter and Facebook are great B2C marketing tools because of the exclusive values that marketers can give to insiders—whether they are “followers” or “friends” or “fans.” Old-style advertising is dead. What counts now are relationships, and for that reason, transpromo is a better marketing tool than direct mail marketing. Direct mail sells. Transpromo builds relationships.

The 2009 grads better have their seatbelts on because they are in for a bumpy ride. But they have all the right tools to succeed. And when they do, you better be ready to respect their values and treat them like adults. No advertising. Holla.