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How to make it in business now

Selling to (and by) the Millennials

I went to a conference in London last year and one of the most interesting sessions I attended  was  the subject of understanding the Gen Y or the Millennial generation. The speaker was Curt Steinhorst of the Center for Generational Kinetics.

The Millennials occupy an important and central role in society. These young people age 20 to 38 occupy the largest consumer group in the world today, more so in the Philippines. Learning how to respond and motivate them therefore is of utmost importance if you are to survive in business. This should apply not only for startups but even for well entrenched business enterprises.Millennials

While I am not a subject matter expert on Millennials, it would be valuable for you to pick up on some of the ideas Curt Steinhorst put forward which is largely based on the continuing research of their organization.

1. Millennials communicate in a different way from other generations. The baby boomers may be very comfortable picking up the phone and talking to someone but the Gen Y find a phone call an intrusion. If you want to communicate with them, you need to do it via SMS or text messaging. That was an “aha” moment for me. It explains why when I call my Millennial kids, its takes a hundred rings before they pick up. A call should be used only in an emergency. My wife experimented with this idea by creating a Viber group for the family. I was surprised by the response. Today, that family viber group is filled with daily chatter. Though some of my kids already reside closer to workplace to avoid the horrible commute, we keep in daily touch because of the Viber messaging system. I found out from other people that they have done the same thing with exactly the same outcome.  Curt continues to say that when you want to talk to your Millennial in greater detail, send them an email. He warns however that the “subject matter” in the email will determine if they will open and read it. If it is interesting enough, they will proceed to the first line of the first paragraph. If you make it short and interesting enough, they may jump to the second paragraph and read on, making judgments as they go along on whether they will continue to read and understand what you have to say.

2. Millenials have the attention span of a gnat. It is so short that they say it lasts only for 30 seconds. You may be in front of them making a beautiful pitch but if they are not interested, they tune out and mentally wander. Brevity and high impact therefore is a must if you want to catch them as customers.  For employed Millennials, a lot exhibit the habit of “jumpers,” staying with only one company a year at a time. If you match up a supervisor who is a baby boomer with an attitude of work long and hard, be on time all the time and follow orders and don’t ask too many question, to that of the Millennial who get bored easily, you would have a steady stream of people getting off the company rolls.

3. They are late bloomers. Baby boomers would be talking about getting married, starting a family, and building a career or business from age 20 to 25. Millennials, however, begin that process at the age of 30. You hear painful labels like “lazy” and without direction from parents but the reality is,  in their 20s, they still pretty much do not know what they want to do with their lives. They are in effect like the teenage me of yesteryears.

4. They are outcome driven. Don’t ask them how they will accomplish a task. They will surprise you with their methods. Take the case of Uber, the largest transportation company in the world which  does not own a single car? Look at Amazon! These companies have transformed the way we look at business by thinking out of the box. If you look deep inside these successful companies, you will find battalions of Millennials as their core leaders.

There is more to learn about Generation Y. If you hope to win in business, an understanding of the dominant market that confronts you will pay handsome dividends in the future.

Going back to the subject matter at hand therefore, building a business in this age of Millennials forces you to address these questions:

1. What is your financial model?  Its essentially an iteration of all the potential income and the detailed expenses you will have to pay in running the business. By understanding and anticipating all the possible business expenses, it will show you what level of income or revenue you have to pursue to turn a profit.

2. A true, honest and accurate expense list will involve building an “operations model.” I don’t want to step into a technical discourse into workflow management since that will take up too much space. Pick up a pen and paper and answer “How will you create the product and service and what are the steps you have to take to deliver it to the customer?” In the study of Millennials, they discovered that if it takes too many steps to buy your product, they simply turn away from it. This “one click” mentality if addressed will lead to business success.  The more you compress the process, the more successful you will be. A good slogan to run on would be “faster, better, cheaper.”

3. What is your marketing model? While advertising still occupies a lot of real estate, TV, radio, and print have taken a back seat. The platform that is important to marketing today is social media. As an aspiring business person, you don’t have to be in each one of these social media platforms. Stay in one and build your influence. I dare say that Facebook will remain as the dominant environment where you can launch a marketing campaign for your newly minted company.  Understanding what they need is key to building a product, learning how to communicate to your market will lead you to the pot of gold at the end of every rainbow.

Finally, let me give you some advise on what to avoid in your quest to becoming the next tycoon.

The hobby you are very much interested in may not be a good business venture. People will quickly advise you to start a business where you have tremendous amount of passion.  A lot of bankrupt business owners quickly and painfully learned that its not about “YOU,” its about “THEM,” meaning the customer. The first step therefore is to find what your target market needs. Do not varnish your ideas with feel good statements from people who have made a ton of money from a similar undertaking. I would suggest you make an effort in seeking out people who have failed in the business you are eyeing. You will be able to build a treasure map, though not perfectly paved, but will be well grounded in the truth. It allows you to avoid things that have precipitated the death of those who went ahead of you. This is one true test which will show you if your “passion” is worth turning into a business venture.

Start small! I have been reading lately the book Rich Habits by Thomas Corley and have come upon several discoveries about people who started out poor but transformed themselves into billionaires. The examples he gave were Howard Schultz, chairman of Starbucks whose’s father was a truck driver is now worth $1.5 billion; Ingmar Kamprad of Ikea who is now worth $45 billion. He started out by selling matches to his neighbors; Li Ka Shing, who at the age of 15 had to quit school to work and support his family, he is now worth $25.5 billion and; Do Won Chang of Forever 21 who is worth $4 billion. He started out working in three jobs all at the same time. He was a coffee shop attendant, a gasoline station attendant, and a janitor. I can even include our very own Henry Sy Sr., who started out in a sari sari store, repacking consumer goods to turn a profit. He came to the Philippines from China to help his father support the family. Today, his family owns the largest business conglormerate.

These men were fearless in seeking out entrepreneurial opportunities and more important they all started small.

Study well the business you want to pursue. American statistical data point to a 50 percent bankruptcy rate for start up business before the fifth year. I guess we can make an assumption this number applies to our country as well.  Incompetence was the leading cause of failure of the business. It simply means, people jump in without a thorough understanding of the venture. I always advise people to take your time studying. Don’t be afraid to take on years of study before you commit capital. The persistent warning I give is, capital once committed either is doubled a hundred fold or melted away completely.  There is no turning back so better make sure you know your business roadmap by heart.