Millennials: the nostalgia generation
Millennials love a bit of nostalgia – and marketeers have cottoned on to this. Over the past...
Chinese millennials outnumber the entire population of the U.S.
To put that number even more into context, when the study was conducted* there were 329 million people in the United States, 1.4 billion in China, and 351 million of those people, were millennials. That’s a quarter of the Chinese population.
We talk so much about the habits and trends of Western millennials, but what about those living in emerging economies?
More importantly, how do the trends and actions of 90% of the world’s millennials effect businesses, global economies and our investments?
‘Nearly nine in every 10 millennials live in emerging economies.’* – Financial Times, Millennial Moment
Looking at the data, some trends are constant; such as renting over buying; the use of technology; and travel preferences to name a few.
But there are some differences too: emerging market millennials tend to have a more optimist view of income and finances, with with 71%** expecting to be better off financially than their parents – a figure that’s significantly higher than their developed market counterparts. Credit Suisse puts this down to the above-average wages of millennials in emerging markets*** compared with peers in other regions, as well as local older consumers.
A couple of weeks ago we discussed how millennial trends are influencing the U.S. auto industry. Younger generations in emerging markets are also showing a significant decline in car ownership, with the decline in the intention to buy cars within the next year most pronounced in China, India and Mexico***.
However, when they do purchase a car, they are going for established and reliable names. Honda is the most popular, with the second most purchased brand being Toyota***, a holding in Baillie Gifford Japanese fund^, which is also known for its alternative fuel cars.
Millennials – no matter where in the world they live – are making healthier choices from stopping smoking to excising more. Sport is increasingly popular, with 40%*** of millennials reportedly working out at least once a week in all countries, with the exception of Turkey. The trend for healthy living makes companies like Adidas, a holding in Jupiter European^, a popular choice among young consumers, especially with the growing influence of “athleisure” fashion trends.
The biggest difference, however, was the growth of video gaming – the “second biggest sport in the world” according to Credit Suisse, with more than 2 billion participants***. More than 600 million*** gamers are located in China and over 50%*** of revenue from video games are generated in emerging markets.
In developed markets we tend to think of video games as consoles like Playstation (Sony) or X-box (Microsoft) but in emerging markets over 60%*** of consumers use mobile-based products like a mobile phone or tablet to play video games, with the largest amount of console use in emerging markets found in Mexico***.
It’s no longer a fight for the best console: it’s about building out an infrastructure of strong signals, affordable wireless plans and a reliable phone. Samsung is a prominent choice when it comes to investing in Korean technology. It’s a holding in Schroder Asian Alpha Plus^. However companies such as China Mobile, the State-Owned telecommunication corporation, are responsible for making sure those devices work anywhere. Both Samsung and China Mobile are top ten holdings in Magna Emerging Markets Dividend.^
*Source: Financial Times, Millennial Moment
**Source: Entrepreneur Europe, 6 Sept 2017
***Source: Credit Suisse, Emerging Consumer Survey 2019
^Source: Fund factsheet, 30 April 2019