FEATURE Alphabet

Confusion about generational cohorts abounds: What separates Generation Y from X, and is Generation Z a thing? Where do Millennials fit? If you’ve ever felt muddled by this alphabet soup of names…

you’re not alone. Te real frustration hits when it you realize that Gen Y consumers will earn 46% of income in the U.S. by 2025.1 And unless you understand who they are and what they want, you won’t capture a dollar of their money. Furthermore, as one genera- tion’s spending power decreases (i.e. Boomers) another is increasing.

People grow older, birthdays stay the same

A common source of confusion is age. Generational cohorts are defined (loosely) by birth year, not current age. Te reason is simple: as people age, they change life stages. For example, a member of Generation X who turned 18 in 1998 would now be nearly 40. In that time, he or she cares about vastly different issues and is receptive to a new set of marketing messages. As of 2016, the breakdown by age looks something like this:

You may be wondering why Millennials aren’t represented in this

breakdown. Tey are. Te term “Millennial” has become the popular way to reference both segments of Gen Y (more on Y.1 and Y.2 below). Realistically, the name Generation Z is a place-holder for the

youngest people on the planet. It is likely to morph as they leave childhood and mature into their adolescent and adult identities.

Why use letters at all?

It all started with Generation X, people born between 1961-1981, approximately. Te preceding generation was the Baby Boomers, born 1946-1964. Post World War II, Americans were enjoying a new-found prosperity, hence the baby boom. But the generation that followed this didn’t have a blatant

cultural identifier. In fact, that’s the anecdotal origin of the term Gen X — illustrating the undetermined characteristics they would come to be known by. Depending on whom you ask, it was either sociologists, a novelist, or Billy Idol who cemented this phrase in our vocabulary. From there it was all down-alphabet. Te generation follow-

Gen Z

74 million* 2-20

years old Gen Y.2

42 million* 27-36

years old Gen X

82 million* 37-52

years old

ing Gen X naturally became Gen Y, born 1981-2001 (give or take a few years on either end). Te term “Millennial” is widely credited to Neil Howe, along with William Strauss. Te pair coined the term in 1989 when the impending turn of the millennium began to feature heavily in the cultural consciousness. Generation Z refers to babies born from the mid-2000s

Gen Y.1

31 million* 20-26

years old * people in U.S. 6 MIDWEST INDEPENDENT BANK MIBANC.com

through today, although the term isn’t widely used. Tis may signal the end of ‘alphabet soup’ (it does coincide with the literal end of the alphabet, after all). A flurry of potential labels have appeared, including Gen Tech, post-Millennials, iGeneration, and Gen Y-Fi, as dubbed in this Huffington Post post.

Why bother with splitting up Gen Y?

Te Financial Brand has reported on three costly myths associated with Gen Y. In the article, Javelin Research used Gen Y.1 and