Abercrombie & Kent founder and LUX contributor Geoffrey Kent discusses how a new generation of consumers are influencing brands
How well do you know your socio-economic and demographic grouping acronyms? From the best-known, like Yuppie and Wasp, to the more recent, Sinbad – there seems to be an acronym for everyone.
If you are a frequent reader of my columns here on LUX or if you’re familiar with our luxury travel company, Abercrombie & Kent, you might be forgiven for thinking that we concentrate on attracting Dinkies, Tinkies (two incomes, nanny and kids), Glams (those who are greying, leisured, affluent and middle-aged), or even Rappies (retired affluent professionals), but in fact, we, like all brands, are increasingly turning our attention to the Henrys.
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Nothing to do with the Hooray Henry, this term was coined by Fortune magazine and stands for ‘high earners, not rich yet’, Henrys are those on their way to affluence, but not quite there yet due to high living costs and other factors. While Henrys span both the millennial and GenY generation, it is millennial Henrys, which are of so much interest to entrepreneurs and their marketers for two simple reasons.
Firstly, their numbers: as revealed in an all-important announcement in 2015 from the U.S. Census bureau, millennials (born between 1980-2000) surpassed Baby Boomers (those born between 1946 and 1964) as the largest generation in the U.S. (where this type of research frequently seems to stem from and of interest to me because of A&K’s American offices (A&K is headquartered in both London and Downers Grove, Illinois). Plus there are many, many more of them in comparison to their parents’ generation.
Secondly, their spending power: from now until 2040, millennials will be entering their prime spending years. They will be the key consumer segment driving the world’s economies.
The millennial generation had its biggest birth year in 1990, so using them as an example, the top 20 per cent Henrys (high earners, not rich yet) born in 1990 earn over $50,000 per annum and the top 10 per are earning more than $75,000 a year approximately. They are well on their way to affluence, and are more educated, better informed and setting the trends that other millennials will emulate.
And with millennials driving economies, as brands try to win their business, millennials will change the businesses and their offerings, thus affecting us all. They are driving what is coming to be called the ‘experience economy’, moving from consumerism towards experientialism (read more about how they are redefining luxury travel here). If you have a subscription to a streaming service and no longer purchase DVDs or boxsets for example, it’s all down to millennials and this trend. If you have noticed more travel companies urging you to experience a destination like a local or learn something on holiday, you now know who the cause is. This isn’t exactly new ground for A&K – we’ve been encouraging travellers to make horizon-broadening connections since the early 1960s – plus çachange.
Millennials and the Henrys among them are focussed on value, not price point, and interested in feeling proud of their purchases and the things they do. They are design-led, crave authenticity and want for everything they do to be climate positive (or at a bare minimum, neutral). They are the type to choose a travel brand that is philanthropic and does good in the places in which its guests travel (such as A&K). They want a curated experience, that does no harm (i.e. is socially responsible) and that is Instagrammable. They share their experiences in the same way that their parents related theirs at dinner parties.
They are searching for a connection to their communities, other cultures and the world at large. Travel is a practical way to process and respond to an increasingly complex globe.
Thanks to childhoods, lifestyles and the psychology of millennials, they are the ‘Do It For Me’ customer – exactly the type that appreciates a well-travelled and knowledgeable travel expert who will arrange their luxury holidays for them. A match made in heaven? Who knows, but it certainly was a match made sometime between 1980 and 2000.
Discover Abercrombie & Kent’s luxury travel itineraries: abercrombiekent.co.uk