EXPERIENCES ARE UNFORGETTABLE.

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1 Micro-Moments Are Nice. EXPERIENCES ARE UNFORGETTABLE. Millennials Brands Who Bring Them Experiences, Not Things MARCH 2016

2 Micro-Moments Are Nice. Experiences Are Unforgettable. We are an always-on society, constantly connected to our devices. Instant media and communication is at our fingertips with a barrage of marketing messages daily. Yet it s harder than ever for marketers to capture attention, engage and spend quality time with their audience. It s time to redefine how we think about engagement and music is the perfect conduit. Particularly for marketers obsessed with Gen Y. This generation s attachment to technology allows them to manage their world easily and efficiently and on their terms. It s the first generation where digital is both a marketer s friend and foe to capture attention. Music is a universal language that transcends age, gender and Music is a universal language that transcends age, gender and cultures. cultures. It is a powerful connector and Pandora has been digging further into the relationship our listeners have with music to dissect its role in important moments, daily routines, defining mindsets and of course connecting marketers with their coveted audiences. As a daily habit for more than 80 million people every month, we create personalized music moments all day, every day. Those are important, real life moments. BUT what happens when you layer on experiences to every day moments? Those experiences become life stories. They become memories. They become unforgettable. Read on to see how the power of music experiences can help you win the hearts, minds and even wallets of one of the hardest-to-crack generations. 2

3 EXPERIENCES TRUMP THINGS. Never has there been a more discussed, misunderstood, stereotyped and generally confusing generation as Millennials. They are hyper-aware, but multi-tasking. They have more options, but less loyalty. They are always connected, but 56% of Millennials feel more and more disconnected from the physical world (compared to just 33% of Boomers 1 ). And 67% of Millennials would rather spend their money on experiences than things. That is 10% growth from when we asked this same question last year. But you can t always put one coat of paint on a whole generation. 74% of women prefer experiences over things. That is significantly higher than males (58.5%). So, what does this mean for brands who are ultimately trying to sell things? Gen Y s craving for experiences gives us incredible insight into their mindset. There s an opportunity for marketers to leverage experiential to play a powerful role in their engagement strategies, whether those experiences are on the scale of a multi-day music festival or a singular surprise-anddelight experience on mobile leading up to an event. And through our Pandora SoundBoard panel, we also found that while Millennials crave experiences, the buying of things still plays a critical role in enjoying those experiences. 67%OF MILLENNIALS WOULD 1. U.S. Census Bureau, 2013 RATHER SPEND MONEY ON EXPERIENCES THAN THINGS 3

4 MUSIC TOPS THE CHARTS FOR MOST DESIRED EXPERIENCES Concerts and music festivals both hit the top five list of most desired experiences for Gen Y listeners. This shows that not only is music a universal language, but live music experiences are craved and treasured. This is proven in the attendance for concerts and festivals. They crave them and they attend them. 81% 60% 49% 32% 26% Travel Concert Movie Music Festival Sporting Event Adults 18+. Question: Which experiences would you rather spend your money on? 4

5 GETTING INTO THE MILLENNIAL MINDSET Let s understand the Millennial mindset on why they are choosing these experiences. We asked what the most important factors were for deciding to attend a music event, and this is what they told us: 1/4 th admitted it was because they were afraid that if they didn t go, they would miss out. The FOMO effect! That is why the road leading up to the event is just as important as the event itself. Marketers can help create the excitement by finding ways to be part of the fear of missing out. Make the before part of the experience. 25% say FOMO is a driving factor to attending a music event. FOMO The FOMO Effect Fear of missing out or FOMO is a pervasive apprehension that others might be having rewarding experiences from which one is absent Przybylski, A. K., Murayama, K., DeHaan, C. R., & Gladwell, V

6 MAKE IT PERSONAL. There are bigger driving factors than FOMO, though. Let s take a look at what motivates Gen Y to attend music events. A third of Millennials (32%) said the event being free was a deciding factor for them. 49% said it was because their friends are going events are social, shared experiences. 55% said it was the atmosphere the experience once they are there means a lot to them. That s the value brands can bring. How can your brand enhance the atmosphere? Add to their experience? An overwhelming 95% said that it was an artist they knew and liked. That seems like a no duh moment, but considering that a popular artist is ranked #5, this is interesting. Millennials know what they want and what they want is an artist that means something to them personally. 95% 55% 49% 32% 31% 25% ARTISTS (AS ALWAYS) DRIVE THE MOTIVATION FOR MUSIC EVENT ATTENDANCE Artist I Know and Like The Atmosphere Friends Are Going Whether It s Free Popularity of Artist Fear of Missing Out Adults 18+. Question: What are the most Important factors for attending a music event? Millennials know what they want and what they want is an artist that means something to them personally. 6

7 AND WHAT HAPPENS WHEN FOMO BECOMES A REALITY AND THEY ACTUALLY CANNOT ATTEND? Welcome, live streaming. With the acceleration of technology, live steaming has become more accessible and has improved in quality. It is becoming a more popular way for people to handle their FOMO and experience the music from wherever they are. This is important for brands to think about. Live streaming is a fabulous extension to the onsite experience and brands can get the credit for taking those experiences beyond the stage. OF MILLENIALS SAY THEY WOULD LIVE STREAM A MUSIC EVENT 7

8 MILLENNIALS LOVE BRANDS WHO BRING THEM EXPERIENCES Music events increase key brand metrics including awareness, positive opinion and purchase. 82% say they noticed a brand sponsoring a music event. That is a 12% increase from when we asked the same question last year. And 1 in 3 have a more positive opinion of that brand after the event. But this hard-to-reach, hard-to-engage, hard-to-resonate-with audience not only notices sponsors. They embrace them. Overall Younger Millennials ages as well as African American and Hispanic year-olds are the most positively affected by a brand s sponsorship of an event. More than 1 in 3 Millennials are more likely to actually purchase the brand s product after seeing it at an event. Even though experiences trump things, experiences can help lead to purchasing things. Notice a brand sponsoring a music event Have a positive opinion of the brand after attending an event 8

9 THE SHOW ME YOU KNOW ME GENERATION Personalization is the key to driving affinity for your brand and it can easily trigger surprise-anddelight moments with people who matter most to you. Here is an example of how we do it at Pandora: Those 80+ million active, logged-in listeners act like human beacons, generating over 1 billion data points every day. Music becomes an amazing translator of behavior, lifestyle and mindset. We see what artists people are listening to, how often, what time of day, what device and so forth. With this we can do two things really well to create magical, memorable moments that connect artists, fans and brands. First, we can see who is trending in a particular market and partner with that artist to connect them with their fans. Second, we can see who within that geographic is listening to the artist whether they have added the artist s station or thumbed up one of their songs. Now imagine a fan of an artist receiving an invitation to attend a FREE concert for an artist they already love. That is a powerful way of showing a person that you recognize what they like by delivering an unexpected treat with a free experience. Speaking of free younger Millennials (18-24) are 35% more likely to want to attend a music event than older Millennials (25-34) if the event is free, as they have less disposable income. The unexpected, personalized and free experience drives an emotional connection for Gen Y and brands, and can be the lynchpin to long-term loyalty for a generation where brand loyalty does not come easily. 9

10 Moments Are The Cake Experiences Are The Icing. Remember, experiences trump things. If micro-moments are the cake, experiences are the icing. Please reach out to your Pandora representative or contact us here if you would like to hear more about how Pandora can help you create unforgettable experiences through the passion point of music. 10

11 11

12 WHEN PANDORA PLAYS, YOUR MESSAGE WORKS. METHODOLOGY: A survey ran on the Pandora Soundboard in January 2016 surveying Pandora listeners A18+ about their attitudes and opinions regarding events and concert attendance. A total of N=3,755 A18+ answered the survey. Data has been weighted by gender and age to match Pandora s registered user data.

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