According to Pew Research Center, in 2015 more than 75 million Millennials will over take Baby Boomers in the U.S. There will be more than 79 million by 2050 (Fry). The Millennials are radically different from previous generations in their attitude towards the notion of ownership. It is a generation that truly challenges the paradigmatic model of acquiring and owning goods; thus, it radically re-defines the American Dream with its constituent elements—owning a house and an automobile. Given their population size, this generation will have a lasting impact on our future. Various contributing factors are at play in these shifting attitudes: ever-accelerating use of the Internet, mobile technologies, spread of social, and crowd apps, among which Facebook and Snapchat are probably the most representative ones. Symptoms of this paradigmatic transformation include such phenomenon as “shared economy” or “collaborative consumption.” The prevalent traits of this generation seem to be a decreasing value of solid commitment, emphasis on the “provisional” rather than the “permanent” and a certain form of existential “nomadism“ or “tourism” allowing an individual to become a collector of experiences rather that things. This behooves us to re-examine establishes notions: “What it means to own things or ideas? Is the notions of ownership as exclusivity and control of any use in the, catalyzed by digital technology, rapidly changing social-economic landscape?” The idea of ownership is undergoing a change that will affect the way businesses are conducted from marketing to sales.
Who are the Millennials? In a nutshell: Americans age between 15 and 34 who grew up with social media technologies and smart phones, representing the most diverse and educated generation to date. More than 40 percent identify with a race or ethnicity other than Caucasian, which is roughly double compared to the Baby Boomer generation when they were the same age. About 60 percent of adult Millennials have attended college, while 46 percent of the Baby Boomers did so (The Council of Economic Advisers). Most significantly, they have come of age during a time of rapid technological, digital change, globalization, and economic and political turmoil. Not surprisingly, Millennials have developed a very different set of skills, behaviors, and expectations from their predecessors. They came to be known as the first generation of “digital natives,” and their affinity for digital technology and social apps helps shape not only how they spend their money but also how they function socially (Goldman Sachs).
Equally importantly, Millennials were raised on “sharing” models from Napster to Spotify to Netflix, which resulted in branding them as “the cheapest generation.” Crushed by student debt and stuck in a arduous job market, Millennials seized opportunities provided by changing business model brought about by digital revolution and less willing to pay for things previous generations did not question, including music, newspapers, and cable TV. The Millennials are more selective about the content of the above; they certainly prefer to get goods and services instantaneously. They are constantly looking for alternative ways of obtaining more value while accumulating less property.
Furthermore, Millennials have been slower to move out and marry. Their socially progressive attitude allows them to embrace, alternative to traditional, marriage and lifestyles. When they live on their own, they prefer small, urban apartments rather than sprawling suburban houses. Consequently, they don't have much room for as many goods. Where there is simply no space to hoard the physical, the virtual will suffice (Goldman Sachs). What really matters to them is access and instant consumption anyway. As Rachel Botsman puts it: “I believe (…) our relationship to satisfying what we want is far less tangible than any previous generation. I don’t want the DVD; I want the movie it carries. I don’t want a clunky answering machine; I want the message it saves. I don’t want a CD; I want the music it plays. In other words, I don’t want stuff; I want the needs or experiences it fulfills.” (Botsman) This has changed the music industry and the popularity of Spodify is a good example. Why own music when you can stream it on demand?
Thus, Millennials’ shifting attitude towards ownership can be articulated as a preference for “experience” over accumulating stuff. This generation is satisfied with limited and temporary control over things; they are just fine with “access” to them when they need them. After all, in a constantly evolving digital reality, possessing thing is no longer needed, nor it brings joy. To the contrary, it becomes an unnecessary burden: Why commit to something that may change tomorrow? Rich Radka writes: “In societies saturated by hyper-consumption, the joy of acquiring and holding the new object in your hands and knowing with satisfaction that it’s yours, is familiar. Equally recognizable though, is that creeping anxiety when the sheen starts to fade and your mind gets distracted with a new, better, life-improving version and at this intersection ownership becomes a pain, a burden” (Radka). This shift in values also allows us look at the Gen X and their attachment to physical goods from an interesting perspective.
This mindset signifies a radical departure from the traditional American Dream where to “make it” meant to secure status, freedom and security by accumulation of goods that could be them passed down to the next generation. This is no longer viable in a new reality where many possessions with a speed of light are changing from treasure to junk, from security to liability, from freedom to burden (Radka). Moreover, the established notion of ownership might be fundamentally incompatible with emerging rules of digital and shared ownership. The element of control, so fundamental to the traditional notion, is costly, extremely difficult to enforce, and insufficient in a digital environment. Even if restrictions are to be strictly enforced on the Internet, it is questionable whether they would be beneficial. An argument might be made that such overregulation could stifle creativity and progress.
Even though the Millennials are the champions of this collaborative sharing phenomenon, individuals of all ages seem to adopt similar behaviors and attitudes to varying degrees. Digital technology obviously enabled social networking, which in turn facilitates collaborative consumption; however, the root of the shift seems to stem from realization that one get more value by owning less property or at least giving away some of its exclusivity. It is entirely rational to monetize on a summerhouse that remains unused for most of the year, a spare room in a city, an empty couch in a living room, a car we only use on weekends, or even share custody of a beloved pet when we go away.
One could make a compelling argument that the seeds of sharing economy were always with us but it really took the right digital tools, using social networking, and mobile apps to realize it. The Millennials are truly the first generation of the digital age so they embraced the notion of collaborative consumption organically. Other factors, obviously played a role—as Rachel Botsman emphasizes—environmental, reduced spending power, and resurgence of communities (Botsman). They all are facilitating the rise of collaborative consumption. The Millennials recognize this it as a viable an alternative to having unused stuff on shelves. The days of “more is better” may be numbered.
Still, there is a noticeable disconnect between the traditional business model clinging to the old paradigm of property and the new notion or provisional “access.” This is undoubtedly a very turbulent and disruptive moment for certain types of businesses as they struggle to adjust. No industry, however, seems to be immune to the forthcoming change. And yet this seemingly disruptive push of Millennials for sharing economy can be viewed as wave of renewal of basic human bonds. Botsman believes that perhaps the most important effect of collaborative consumption lies in the way technology is “enabling trust between strangers” (Botsman). We found ourselves now living, she asserts, “in a global village where we can mimic the ties that used to happen face to face, but on a scale and in ways that have never been possible before” (Botsman).
The need for social interaction is a powerful primal force behind the shifting preferences driving a preference for experiencing over owning. The new attitude encapsulated in a phrase “Rent, Stream, and Experience” foreshadows a new social reality where increasingly possessing exclusive rights to something is becoming irrelevant, and where “access” will be the new “have.” As one of the Millennials put it: “Our increased aversion to ownership is not a shortcoming, it’s an opportunity. Valuing experiences means we don’t want just one thing; we want a little bit of everything (…) Possession is finite; access is unlimited” (Bradshaw). This is surely just the beginning of our new approach to ownership and wealth that has the potential to leave lasting imprint on generations to follow. Perhaps, the next generation—a social generation or Gen S—will elevate and amplify this new attitude.
Botsman, Rachel.The Case for Collaborative Consumption. TedxSydney. May 2010. Accessed 8 April 2015.
Bradshaw, Leslie. Rent, Stream, Experience. I am not interested in owning very many things, et tu? Medium. 8 December 2014. Accessed8 April 2015.
Cassie, Ron. Baltimore 2.0: How the millennial generation and a new “sharing economy” are transforming the way cities function. Baltimore. January 2014. Accessed 8 April 2015.
Fry, Richard. This year, Millennials will Overtake Baby Boomers. Pew Research. 16 January 2015. Accessed 8 April 2015.
Goldman Sachs. Millennials: Coming of Age. Goldman Sachs. Infographic. 2015. Accessed 8 April 2015.
Radka, Rich. Changing Models of Ownership: Part I. 8 February 2011. Accessed 8 April 2015.
The Council of Economic Advisers. 15 Economic Facts About Millennials. Report. Executive Office of the President of the United States. Washington, DC, 2014.