Forget Generations X and Y: Here comes Generation V

Much has been made of the stereotypical characteristics of the generations that followed the Baby Boomer era. The same can be said of the latest generation, but Gartner warns marketers to define them by their online actions rather than their birth dates. In a report released this week, Gartner said that traditional marketing methods won't work with this new group of consumers.

The latest group, dubbed Generation Virtual, or V, is made up of people from multiple demographic age groups who make social connections online - through virtual worlds, in video games, as bloggers, in social networks or through posting and reading user-generated content at e-commerce sites like Amazon.com, said Adam Sarner, senior analyst at Gartner.

The V generation is made up of people who are drawn to the Internet's "flat meritocracy" where people can gain status and acknowledgement through ways - like providing advice or recommendations or excelling at a video game - not generally available in the physical world. Basically, Generation V is made up of people who replace physical experience with an online experience, Sarner added.

The online distinction is important, he noted, because companies looking to sell products and services to this generation of consumers can no longer rely on traditional demographic data like name, age and address to tailor marketing messages. Generation V is more likely to interact with marketers anonymously - through an online persona made up of all their online behaviors, Sarner said.

"We have to start dealing with this idea of anonymous, multiple personas interacting with our businesses and how to do that," Sarner said. "[Businesses] are creating a world with processes to get them to purchase things. Virtual environments will be a way to orchestrate customer exploration, [but] underneath is the reality that they are providing goods and services."

Over time, gathering details about the online personas of consumers will become far more important than the mining of demographic data, he added. By 2015, Gartner asserts, more money will be spent marketing and selling to multiple online personas than money spent marketing to off-line consumers.

For companies to prepare to market to Generation V, Gartner recommends:

• Organizing products and services around multiple online personas;

• Selling to the persona not the person;

• Creating virtual environments as a way to orchestrate customer exploration toward purchases;

• Shifting investments from known customers to unknown ones; and

• Developing and retaining new employee skills to attract, connect, contribute and gain insight from generation V and their virtual environments.