Lord knows I joke about millennials, that group of people born from 1985 to 1996. They are fickle and they are feckless, but they are the future -- and if you are a consumer brand manager, you have to do your best to win them over because they, not my generation, are the future. The Baby Boomers are in their sunset years and appealing to that set-in-their-ways group is just silly. You advertise to get them, you are advertising to get those whom you've already got.
Millennials, though, are hard to figure. They average about $35,000 a year in salary and have about $40,000 in student debt. They are slow to have families and are fast to say they are stretched to the limit every day.
Yesterday I found out, up close, an undeniable trend that's dictated by those low salaries and high debt: they want bargains. And they get them at the dollar stores of America. Gary Philbin, CEO of Dollar Tree (DLTR) , drove this point home when we went aisle to aisle after my interview with him in a revitalized Family Dollar, where a host of millennials live, something I know because of my daughter's beach house -- ok well mine, but she took it.
There are more than 14,000 Dollar Tree/Family Dollars and there are 13,000 Dollar Generals (DG) . They are ambitious, both companies, because they keep putting up stores. Why?
Among other reasons, because millennials are attracted to dollar stores. It's a preferred place to shop. Why? Many millennials don't own cars anymore. That's the Uber (UBER) factor. All millennials shop with cellphone in hand. Many price check. They have no brand loyalty.
They are ingredient lookers -- my eyes are so bad I can't even look at the fine print. They worship at the temple of fine print. Because they have no loyalty and because they look at what's in the bag or the box, they know that the national brands are overpriced. So they can buy the lookalike store brands at a dollar joint that's conveniently located near them, perhaps even within walking distance, and they feel like they are getting one over on the company.
Convenience, bargain, saving time. These are hallmarks of this generation -- and perhaps the only set of truisms that make sense because the information from these very successful companies informs selection particularly among salty snacks, always one of the most lucrative aisles in any store.
Now lots of companies have laid claim to millennials. However, when the tide went out, we saw who was swimming in various venues. The cruise ship companies have forever touted millennials, because of the Instagram nature of a cruise -- it's a great back drop. But they have been raising prices to please Wall Street and I fear they have lost the bargain imperative. One look at the woeful stocks of Camping World (CWH) and Thor Industries (THO) , tells the story: Two outfits that cater to the outdoor crowd and seem to have built up a lot of inventory to meet millennials' demand. Whatever happened to glamping, we don't know. No company will ever admit to losing the millennial customer. Why would you ever do that, but these, too, seem to have lost their bargain appeal.
What do we know hasn't? We have seen a dramatic expansion in at-home dining, courtesy DoorDash, Postmates, Uber Eats (UBER) and Grubhub (GRUB) -- and that means it's not only Domino's Pizza DPZ that delivers. Video games still resonate as Take Two Interactive (TTWO) knows all too well. Again, convenience; bargain. Finally cord cutting has priority. The price is right, thanks to Roku (ROKU) .
I wish I never had to figure these companies out. But when you look at the anemic growth of old brands or new ones that catered to this cohort until the cohort turned on them, you can have a better handle on what they sit and what they stand -- and without it, you're going to miss out on some terrific opportunities and get blown out by others.