NEWSWIRE: 9/25/17
- New apps like BumbleBizz take a Tinder-like, swipe-based approach to professional networking. Such services promise to be a hit with Millennials, who are driven to get ahead at work and have embraced intuitive digital communication channels. (Wired)
- NH: Yes, they may be a "hit," but whether they will actually help Millennials find better jobs and become profitable long term remains to be seen. Face it, even Tinder is widely despised by young people seeking serious relationships and (as a result) has disappointed investors. Sexy challengers to LinkedIn face even greater challenges--and the landscape is littered with startup competitors that have crashed and burned. Even Tinder itself tried ("Humin") and failed. The problem is that the basic trust engendered by face-to-face interaction is extremely difficult to create digitally. But try explaining to a Millennial that a real-life conversation is actually a more efficient search technique than clicking through apps. Good luck.
- Philip Morris has pledged $1 billion over the next decade-plus to fund research designed to eliminate smoking worldwide. While this may seem like an odd move, it is hardly altruistic: Philip Morris and the other Big Tobacco giants have cornered the market on cigarette alternatives, such as smokeless tobacco and e-cigarettes. (Financial Times)
- NH: Since Big Tobacco foresees declining demand for cigarettes throughout the high-income world (and much of the Asian emerging market world as well), it is resigned to a strategy of substituting smokeless tobacco and e-cigarettes for regular cigarettes. The report hopefully forecasts that 30% of PMI's remaining customer base will be transitioned to these pricey alternative products by 2025. Yet PMI surely hopes for continued growth of regular cigarette demand in Africa and the Middle East--regions where they probably expect fewer regulatory restraints. (See: "How (and Where) to Bet on Big Tobacco.")
- Ahead of its 50th anniversary, Rolling Stone is being put up for sale by controlling shareholder Jann Wenner. The publication’s historic status as a cornerstone of Boomer counterculture is not enough to save it from the headwinds facing the print magazine industry. (The New York Times)
- Fully 54% of young Xers (ages 35 to 44) have less than $1,000 in savings—including 38% that have no savings at all. While this rate doesn’t include retirement contributions or other investments, it does indicate that a dangerously high share of Xers are still living paycheck to paycheck nearly a decade after the recession. (GOBankingRates)
- NH: Older Xers (ages 45-54) are doing even worse, with 56% having less than $1,000 in savings. These figures are nearly as high as for MIllennials (ages 25-34, at 61%), even though Xers have higher wages and bigger family commitments. The U.S. personal savings rate, which has fallen since last November's election, is due for an Xer-driven rebound. The trigger may be an interest-rate hike, a market crash, more Xers simply running out of money--or all three at once.
- The share of teens who have a driver’s license, who’ve tried alcohol, who date, and who work for pay has plummeted since 1976—with the most dramatic decreases occurring in the past decade. Sheltered and risk-averse, Millennials are eschewing the traditional markers of adulthood for more tame activities. (Child Development)
- NH: The Washington Post did a nice feature story based on this study, the gist of which we have been writing about for some time. While the academic researchers marshal lots of interesting data, they are less than coherent about the underlying generational drivers of this behavioral shift. They say almost nothing about rising risk aversion, lengthening time horizons, and greater dependence on parents and peer communities. It's not really that Millennials are "slower" to become adults. It's that they are redefining what it means to be an adult.
- Just in time for the fall season, The Honest Kitchen has released a line of pumpkin spice lattes—for cats and dogs. Now, thanks to these goat’s milk concoctions, pet owners can make sure that their furry friends are not left out of the annual pumpkin-inspired retail frenzy. (Cassandra Report)
- Op-ed columnist Steven Strauss says that Millennials are “meant for entrepreneurship” due to their independence, their participation in the gig economy, and their tech savviness. In reality, despite their reputation as a generation of Zuckerbergs, most Millennials would much prefer to play it safe within the confines of a 9 to 5. (USA Today)
- Comcast is providing online video services to more than 100 campuses in hopes of winning over Millennials. In addition to trying to reach young consumers where they live, Comcast also wants access to student data in order to learn what (and how) Millennials are watching. (Bloomberg Business)
- NH: I think what Comcast (and others) will find out by offering college students free cable TV is that college students will gladly consume it--so long as it's free. Just as they gladly consume it at Mom and Dad's home--so long as it's free. Is all this free cable persuading them not to cut the cable cord when they live on their own? The evidence says not.
- On Tuesday, Toys ‘R’ Us filed for bankruptcy—prompting toy companies like Mattel and Hasbro to redirect business to big-box stores and online retailers. While this may stop the bleeding for now, toy companies face demographic headwinds (falling birthrates) that threaten the long-term health of the industry. (The Wall Street Journal)
- NH: Toys 'R' Us failed for many reasons. It was a debt-heavy LBO victim (though I'm sure KKR, Bain, and Vornado Realty got all their money back). It had the bad luck of selling a product (CPG toys) where e-tailers like Amazon have gained a huge market share. It offered consumers a miserable store experience and totally ignored the one consumer demo where toy sales are strong and toy margins are high (educated parents of "creative" children; see also our story: "Tinkering in Toyland"). And, yes, fertility has recently turned into a headwind.
- Contributor Libby Kane argues that Millennials aren’t difficult and entitled, but rather optimistic and resilient. She points out that every generation is shaped by the previous generations, and Boomer and Xer helicopter parents have raised Millennials to be a hardworking bunch. (Business Insider)
DID YOU KNOW?
Show Me Your Money. As we’ve written before (see: “Did You Know? Popping the Credit Score Question”), finances have become a key factor for Millennials evaluating a potential suitor. But this generation’s habit of cohabiting before marriage causes potentially problematic financial complications. Fully half of Millennials address the issue by merging at least one bank account with their partner before marriage. But how can the other half get a grasp of their partner’s financial status and habits before walking down the aisle? Enter services like Honeydue and Honeyfi, app-based solutions that link a couple’s bank accounts and even allow individuals to select which information to share with their partner. Online bank Simple recently released Simple Shared, a de facto joint checking account accompanied by an app that offers transaction alerts and payment records. In addition to promoting transparency and offering a preview of life as a financially codependent married couple, these apps also make for a clean break should the relationship fizzle.
