What do millennials want? The now-familiar OTT narrative suggests they are deserting linear television on the main screen en masse in favour of on-demand programming consumed on portable devices. Establishment Survey data suggest the reality is less apocalyptic: not so much a rejection of linear as an embrace of television in all its forms, both traditional and new. Millennials want ready access to television in all the ways it can be consumed.
What do we mean by a millennial?
The term millennial is used widely in the marketing industry with little clarity about exactly whom it refers to. For most commentators, the definition is based on age: a millennial is someone born in the last two decades of the 20th century. This fits with the debate within the television industry, which focuses on the viewing habits of people who have grown up having access to a markedly different set of devices on which they are used to consuming television: PCs and laptops, followed in this century by smartphones and tablets.
It also fits neatly with the 16-34 age cohort that media planners and broadcast analysts regularly use in discussing programme audiences, so this is the definition we will use for this article: a millennial is someone in the 16-34 age bracket.
This is a broad range, and technology has moved fast over the past 20 years. Today’s 16 year-olds have grown up with a different set of viewing options to 30 year-olds, so in the analysis we have split this broad age group down the middle to see whether there are significant differences between 16-24 (younger millennial) and 25-34 (older millennial) age groups. Collectively these millennial age groups comprise 29% of the adult (16+) population, split 16% older millennial, 13% younger millennial. These proportions have remained remarkably stable over the past five years.
Device access for millennials
Since much of the debate within the industry is focused on the extent to which traditional viewing is actually declining in the face of new ways of consuming television, there is an obvious question to start with: are millennials less likely to have access to a working TV set? The answer is yes, but not by much: 92% of millennials have access to a TV, compared to 96% of all adults. There is no significant difference between the younger and older millennial age groups.
Access to a TV set has been declining slowly for the population as a whole. The decline may be slightly faster for millennial age groups, but the difference is small: the gap between the average for millennials and the entire adult population has increased from two percentage points in 2010 to four in 2016.
(An interactive version of this chart is available here.)
Do millennials have greater access to other devices on which they can watch television? The answer here is a much clearer yes. The most striking difference is in access to a smartphone: 90% of millennials (in both age groups) have a smartphone, compared to 69% of all adults (including 16-34 year-olds), and only 59% of over 35s. The smartphone is a device that is practically ubiquitous for younger people. However, even for millennials, the TV set is more pervasive: more millennials have access to a TV than to a smartphone.
Less surprisingly, millennials also have significantly higher access to a games console (50% vs. 35% for all adults). There is almost as great a difference between the younger and older millennial age groups (57% vs. 45% respectively) as there is between millennials and all adults. PCs and laptops have a much smaller difference between millennials and all adults (82% vs. 77%) while it is the same for tablets (68% vs. 63%).
The difference in access to these other devices is not especially surprising. Millennials, particularly younger millennials, have a strong incentive to exploit the portability of non-TV devices to enable them to control their own television experience, since in many households they will not have control over the main TV screen, and often will not want to share their viewing with older adults, particularly parents. It is hardly a new trend for younger people to want to watch television on their own.
Control of the TV is important: many millennials live in homes in which the head of household is not a millennial (45% of all millennials, and 67% of younger millennials), and in these homes they are unlikely to determine the television viewing arrangements. If we want to understand the viewing set-up that millennials want for themselves, we need to narrow our focus to those households in which a millennial is the head of household. We’ll call these ‘millennial households’. Here we can be more confident that viewing arrangements are millennial-driven.
These millennial households comprise approximately 18% of all households, split 14% older millennials, 4% younger millennials. These proportions have remained broadly stable for the past five years.
The age distribution within millennial households is very different from the population as a whole: it is heavily skewed to the age brackets for millennials and children. There are very few older adults in millennial households. For younger millennial households, the skew to the younger millennial age group is even more pronounced; there are relatively few children. The age distribution within these homes gives us a great deal more confidence that the viewing set-up will be determined by a person in the millennial age group.
The average size of millennial households is greater than for households overall: there are significantly fewer single person households, and nearly 25% of millennial households have four or more people, compared to 19% for the population overall. Older millennial households have more young children, which explains the larger household size.
Social grade is an even stronger differentiator. Millennial households are skewed towards C1 compared to the population as a whole, driven in particular by younger millennial households, for which the skew is pronounced. Among older millennial households there is a significant skew towards large households with lower social grades.
The next charts shows how millennial households vary from the population as a whole. For example, 31% of older millennial households are social grade C1 compared to only 28% of all households.
Employment status shows the reason for the skew in social grade: full-time education is the single biggest category for younger millennial homes. 45% of people in younger millennial homes are in full-time education. Under the social grade classification, homes where the head of household is in full-time education are classed as C1.
Younger millennial households are also skewed towards the D social grade, because young heads of households in work tend to be people who left full-time education relatively young, and are therefore less likely to have skilled, supervisory or managerial level jobs.
The preponderance of people in full-time education or in less skilled jobs means that disposable income for these younger millennial homes is likely to be significantly lower.
Device access within millennial households
What set-up do millennials choose to watch television when they are in charge of the household? We can examine this from three perspectives:
to what extent do they adopt a traditional viewing arrangement, i.e. have access to a TV set?
to what extent do they have access to other devices which are used for watching television?
what is their choice of platform and/or service?
Access to a TV set
Millennial homes do appear to use a TV set less for television viewing. Only 84% of millennial households have access to a TV set, compared to 95% of homes with an older head of household. However, the millennial figure is pulled down by the much lower percentage of younger millennial homes which have access to a TV set (73% vs. 86% for older millennials). This is because a high proportion of younger millennial householders are in fulltime education: student accommodation rarely provides TV access. This is hardly a phenomenon specific to the millennial generation: students have never had ready access to a TV.
If we exclude homes where the head of household is in full-time education, the proportion of younger millennial homes with TV access increases to 84%, and the overall millennial average increases to 87%.
It is clear that millennials are somewhat less concerned about watching television on a TV, but the figures do not yet suggest millennials are forsaking the TV set en masse. Ofcom’s recent qualitative report on linear vs. non-linear viewing reported that the TV set continues to be the favoured device for both linear and non-linear viewing across all age groups, including millennials. However, overall TV set access is very slowly coming down, and as it does so, millennial access is decreasing slightly more rapidly.
Access to other devices to watch television
The difference between millennial and older households is much more marked when it comes to claimed use of non-traditional devices to watch television. Millennials are around twice as likely to say that they use a mobile phone or games console to watch television, and about a third more likely to claim usage of a computer or tablet.
This suggests millennials are willing to consume television in different ways; it doesn’t necessarily demonstrate a diminished interest in television itself. Mobile devices like smartphones or laptops offer additional flexibility and greater opportunity to control what is being watched, for example when the main screen is already in use. As multi-purpose devices, they are also likely to be seen to offer greater value for money than a TV set, particularly when the household is considering a second device to complement the main TV. Younger households are likely to face greater constraints on spending power, and we have seen that millennial households skew towards lower social grades.
The greater role for non-traditional devices highlights the importance for broadcasters and content providers of having a comprehensive cross platform strategy if they want to reach millennial viewers, i.e. being able to deliver their programming seamlessly across all types of screen, not just the main TV.
Spending power appears to have a significant role in platform choice, particularly for younger millennials, who are more likely to have less disposable income. They are less likely to use pay TV platforms, especially Sky, and are more likely than older millennials to use free terrestrial only.
By contrast, Sky over-indexes on older millennials, which is likely to be connected to Sky’s appeal to families with children, as well as younger adults’ greater engagement with sports.
However, younger millennial households are not averse to paying for television: they are significantly more likely than other age groups to subscribe to Netflix, which is a substantially less expensive option than the full Sky platform, and 45% of younger millennial households do so. Millennials overall are twice as likely as older households to be Netflix subscribers, while younger millennial households are three times as likely.
Millennial households are more likely to subscribe to SVOD services in general, although the difference between millennial and older households is less marked for Now TV and Amazon.
Looking at what the Establishment Survey tells us, the overwhelming impression is not that millennials have given up on traditional television, it’s that they embrace television in all forms and modes of consumption: linear and non-linear, TV set and tablet. It is hardly new for each generation to want to assert its right to define its own ways of watching; older age groups had relatively few options for doing so, but technical progress has given the current generation many more ways to do so, and it is grasping the opportunity with both hands.