It is often suggested that big, global brands are losing to small, local brands. A strong belief reigns that especially young consumers are rejecting big brands. But what is fact and what is fiction? Researchers from the Ehrenberg-Bass Institute at the University of South Australia have examined the question in depth. Their conclusion: millennials are not that much different from older generations.
In order to test if younger consumers are behaviourally rejecting big brands, research by the Ehrenberg Bass Institute examined the brand shares and penetrations among younger consumers (defined as those aged 18-24) and those aged over 25 for the top 5 brands of fourteen categories. The results show that there are minimal differences in how many consumers aged under 25 purchase leading brands compared to older people. In over 40% of category/year analyses, leading (top 5) brands actually have a higher market share among younger consumers sales than among older consumers. This research refutes the often heard comment that in particular young people (so-called Generation Y/Z) increasingly distrust and reject big brands. The overwhelming empirical evidence shows that younger consumers neither distrust nor reject big brands. They certainly continue to buy them.
Recently it has also been claimed that consumers are rejecting ‘corporate’ brands and seeking out eco/purpose/hipster brands. While it is certainly a trend for brands to signal such virtues, the evidence that consumers are flocking to such brands is lacking. Research into the rejection rates of green brands has indicated that a statistically significant higher rejection (47% compared with 30%) exists for green brands. However, it is important to note that the dominant reason for rejection was unfamiliarity. Another important finding was that non-green brands were practically never rejected for not being green. The reasons for rejection of green and non-green brands were highly similar.
Read the full Ehrenberg-Bass report here: