Market research firm MBLM has released its latest Brand Intimacy Report, which measures the emotional attachment consumers have to various brands. The study reveals that a strong connection is a key ingredient to a better relationship with customers. This translates to better results for the company over the long term, and likely will have a positive effect on its stock price.
There's additional evidence that these customers are willing to pay a premium for those preferred brands. Let's look at the brands that have the strongest attachments for millennials and why.
5. Nintendo (NASDAQOTH:NTDOY). Having grown up with Nintendo, millennials have an emotional attachment to the company and its games. The first of the millennials were just old enough to begin playing Super Mario Brothers when it launched in late 1985, and continued with fan favorites like Zelda, Final Fantasy, Tetris, and Pokemon. Nintendo acknowledged those ties last year in a Father's Day press release, saying, "For dads today, especially the millennials, Nintendo was a big part of their childhood."
Not content to rest on its laurels, the company is enjoying a resurgence with the popularity of Pokemon Go, its mobile augmented-reality game, which sends users on a virtual scavenger hunt for its characters. In its most recent quarter, Nintendo reported hardware sales that rose 19% over the previous year, and reports indicate that the release of the next-generation game is imminent.
4. Apple (NASDAQ:AAPL). Most millennials would have just been entering their earning years with the release of the iPhone in 2007. The introduction of the iPod six years earlier and it's 80% market share provided a perfect transition.
Research shows that, as a group, millennials are the most dependent on their phones. Over 78% of millennials use their phones more than two hours per day, 80% reach for their phones first thing, and 87% report that their phones never leave their sides.
Millennials have grown up with technology and expect it to work, so dependability is important to them. Reader's Digest called iPhones the most trusted mobile phone brand for 2016. That level of familiarity, coupled with reliability, breeds a certain attachment.
3. Netflix (NASDAQ:NFLX). Netflix is becoming the new normal, and nowhere is that more apparent than among millennials. As a group, this demographic was born in the information age and is more tech savvy than previous generations, so streaming Netflix is a natural.
In the decade since Netflix began streaming, it has been embraced by the generation that now outnumbers baby boomers. MBLM's Managing Partner Mario Natarelli said, "We found that escapist brands performed especially well -- mostly in the media and entertainment industry -- due to...the need for distraction, control and enjoyment." Netflix and chill, baby. Netflix and chill.
2. Amazon (NASDAQ:AMZN). Millennials grew up watching their parents order items in the little smiley boxes, and now embrace it themselves. Placing orders from a website, or on a mobile app, is a cinch for this tech-comfortable bunch. Previous studies have shown millennials view Amazon as their most relevant brand, as well. It applies as an escapist play in the same manner as Netflix, via its Prime streaming service.
Millennials' social networking proclivities play a part, as they share their product opinions, and solicit the views of others. This plays directly to Amazon's DNA of customer reviews. As consumers, millennials also collaborate with the brands they connect with, and according to studies, they believe that Amazon has the best customer service.
1. Disney (NYSE:DIS). As much as any other company on the list, Disney taps into the nostalgia of millennials, while remaining a part of their present. From the young stars on the Disney channel to some of millenials' comic book favorites coming to life on the big screen, Disney has always been there.
According to Mario Natarelli, MBLM's managing partner, "Disney resonates with this age group because they grew up with the brand. It has kept up with their changing interests and now includes popular franchises like Star Wars and Marvel... Disney is also a mainstay for young families."
Millennials, as a group, feel strongly about their values, as well as the companies they interact with. Walt Disney was known for his strong sense of family values, and that affinity toward his customers still permeates the company he founded.
Each of these companies has succeeded at creating an emotional connection with its customers, in general, and the millennial generation, in particular. This research shows that strong positive feelings from consumers can be one factor supporting strong company results and better stock performance. This provides investors with another criteria for choosing a winning investment.
Can you feel the love?
Danny Vena owns shares of Amazon.com, Apple, Netflix, and Walt Disney and loves these companies. Danny Vena has the following options: long January 2018 $80 calls on Walt Disney, short April 2017 $105 calls on Walt Disney, long January 2018 $85 calls on Apple, and short January 2018 $90 calls on Apple. The Motley Fool owns shares of and recommends Amazon.com, Apple, Netflix, and Walt Disney. The Motley Fool has the following options: long January 2018 $90 calls on Apple and short January 2018 $95 calls on Apple. The Motley Fool has a disclosure policy.