Gen Y Labs

Social Networking Makes Gen Y More Productive

Social Networking is a touchy subject among many employers these days. Many older managers feel that Social Networking software can do no good, and simply leads to a less productive work force. For this reason, I imagine that many of you work in offices (I know I did all summer) where social networking tools have been banned.

But is social networking really such a negative influence on our productivity? A recent story in the San Francisco Chronicle discusses not only the positive impacts that social networking can have on productivity, but its necessary place in an office full of Gen Y workers who demand constant connectivity.

The article makes 2 great points:

1. Gen Y is more comfortable using social media instead of traditional communication channels  

2. Encouraging social networking usage in the work place is a great way to attract top quality talent to your organization. Gen-Y wants to work for “cool” companies, and promoting social networking use is a great way to improve your corporate image.     

By encouraging social networking use in the office, you kill two birds with one stone. You improve your young employees’ productivity while making them happier. Seems like a good idea to me.

$0.99: Gen-Y's Golden Price for Digital Content

As I was sitting around my dorm today, everyone was talking about the new Jay-Z album.  The record is without a doubt one of the best of the year, and should be in contention for best album when the Grammy awards come around. As good as the Jay-Z album is however, I could only find one person in my dorm that bought a copy of it.

This led me to the interesting question:

 “Why has nobody in college bought the album of the year?”

 It turns out that a big part of this is the recent ITunes Store price increase. In April, Apple announced it would increase the price of “in-demand” songs from $0.99 to $1.29  in an effort to boost revenues.

Apple’s new pricing structure has angered many loyal customers (Gen-Y in particular, but more on that in a second), cutting sales by roughly 12% since February. Apple however is claiming success for its new pricing plan, as Billboard reported that revenues are up despite lower sales.

Despite the fact that Apple and the record industry raised their revenues, I feel that they have made a huge long-term mistake by abandoning their $0.99 pricing strategy.

A recent Gen-Y Labs informal survey of college students across the country shows that $0.99 has become a magical price in the eyes of Generation Y. In fact, 85% believe that $0.99 is a fair price for digital music.

 A further question reveals that roughly 70% of responders are willing to pay for digital music when songs are priced at $0.99. When the price is bumped above one dollar however, we see a completely different story. Only about 1 in 10 responders agree that $1.29 represents a fair price for digital music, and only 1 in 3 survey respondents would choose to pay $1.29 instead of downloading content illegally.

The creation of ITunes was a gift to both Gen Y and the record industry.  It provided consumers with music that was cheaper than in stores, and thus encouraged people to buy their music instead of pirate it.  Through low prices, the ITunes store created good will between the consumer and the record labels for the first time since the beginning of the internet, and as the years have gone on more and more young adults choose to buy their music instead of steal it.

 By raising prices, the record companies have totally ruined any progress that they had made in convincing Generation Y to pay for media content instead of pirate it. This is a horrible decision, because in 10-15 years the music industry’s bottom line will be completely dependent on Gen-Y paying for content instead of using online sources to pirate it. It is my belief that any pricing policy that encourages piracy now will simply cause bigger troubles for the music industry down the line.

What do you think?