Brand agency MBLM is putting the finishing touches on its 2019 Brand Intimacy Report, the largest study of brands based on emotions. The study shows that brands that reach consumers on an emotional level can create better, longer-lasting relationships and form strong bonds with their customers. According to the report, "Brand Intimacy is defined as a new paradigm that leverages and strengthens the emotional bonds between a person and a brand."
There are numerous advantages to forming a strong attachment with customers, but for investors, one stands out. As a whole, intimate brands tended to outperform established financial indexes for both revenue and growth over the past 10 years, according to the report.
Let's take a look at the five brands that millennials have the greatest affinity for in 2019, and some of the reasons why.
2018 was an important year for Nike (NYSE:NKE). The company made the bold choice to feature former NFL quarterback Colin Kaepernick in an ad featuring the tagline, "Believe in something, even if it means sacrificing everything." Kaepernick rose to prominence for kneeling during the National Anthem in the 2016 football season to protest police shootings of African-American men, a movement that quickly spread to other players. When Kaepernick became a free agent in 2017, NFL teams refused to sign him, effectively ending his career.
This ad campaign struck a chord with millennials because it squarely addressed a major social issue. According to Rina Plapler, partner at MBLM, "Nike is interesting. One could hypothesize their support of Colin Kaepernick could have created greater appeal among millennials this year, who generally have more liberal/social tolerance leanings."
It's worth noting that Nike was among the biggest movers on the list, moving all the way up from No. 21 last year.
Disney (NYSE:DIS) continues to be a perennial favorite among millennials, having appeared in the top five most beloved brands for a third consecutive year. The company taps into the nostalgia of this demographic, a strong factor among millennials who grew up with Disney. The company now lists Pixar, Marvel, and Star Wars among its brands, all of which boast a significant meaning for the group.
And as the get older, millennials are now sharing many of these experiences with their young families, further deepening the connection.
"Disney resonates with this age group because they grew up with the brand," stated Mario Natarelli, MBLM's managing partner. "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."
Streaming video provider Netflix (NASDAQ:NFLX) is popular across a wide variety of age groups, but nowhere is that more true than with millennials. This demographic is a product of the digital age and Netflix introduced its streaming video service in 2007 -- just as millennials were entering their prime earning years. The tech-savvy bunch became instant fans of binge-watching. Fifty-three percent of Netflix users admit to some level of intimacy with the brand -- the second-highest average among millennials.
Media and entertainment brands that provide a means of escape have a special place in the hearts of millennials, resulting from the need for distraction, control, and enjoyment. Coming of age during the Great Recession has also ingrained in millennials a greater level of price sensitivity than other generations, making them more likely to cut the cable cord and subscribe to Netflix.
Studies support just how attached to their devices millennials are: 80% admit to reaching for their phones first thing in the morning, 87% say their phones never leave their side, and 78% of millennials say they use their phones for more than two hours every day. The group also just expects their technology to work.
Despite the occasional misstep, Apple (NASDAQ:AAPL) has a reputation for simple interfaces and superior quality.
Apple, both as a company and as a brand, has long been known for its customers' unwavering loyalty to its products, earning those customers the title of fanboys and fangirls. Many millennials entered adulthood as the first iPhone was released in 2007, having grown up with the iPod, which represented the perfect gateway product.
According to Plapler, Apple "Apple... has had great appeal among the younger tech-savvy generations and plays a large role in how we consume, create and deliver information via our phones, watches, etc. (vital for millennials)."
Millennials are the first streaming-video-centric generation, and it's only natural that this would extend to YouTube, one of the pioneers of the genre.
"YouTube ranked 10th with millennials just two short years ago and has steadily made its way to the top," said Mario Natarelli. "The brand has demonstrated an ability to entertain a diverse millennial audience through its extensive content ... Millennials in particular bond strongly with media and entertainment and YouTube is doing a good job at building a brand that caters to the wants and needs of this audience."
There's love in the air
Each of the companies on this year's list has succeeded in forming an emotional attachment to its millennial customers. It shouldn't be a surprise that each of the brands that appear in the top five this year (with the exception of Nike) were also in the top 10 last year, though the order has changed. This shows that while it takes time to create this level of intimacy with customers, it can pay dividends over the long term.
For those interested in finding out which other brands made the cut this year, MBLM's full findings will be released on Feb. 14.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Danny Vena owns shares of Alphabet (A shares), Apple, Netflix, and Walt Disney. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Apple, Netflix, and Walt Disney. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool recommends Nike. The Motley Fool has a disclosure policy.