HRC Advisory President Farla Efros authored an article discussing millennial spending habits for Retail Insider.
The Millennial generation represents approximately 26% of the Canadian population, or about 9 million people. The population is growing quickly, with spending predicted to exceed that of baby boomers.
The group defines itself partly by technology, including the number of devices one possesses. Remarkably, Canadian millennials average over three devices per person. Social media acts as their primary medium of communication, versus the 'old days' of watching the news, reading the newspaper or speaking on the phone. They define themselves by how many friends, followers or 'likes' they receive daily. They communicate via Instagram, Snapchat, Vine, Tumblr and/or texting—they often leave Facebook, as it 'belongs to their parents'.
But don’t be fooled – in some cases, Millennials do like 'the classics'. Many prefer hard cover books to digital and enjoy going out to see movies in a real theatre and on the big screen.
Millennials care about the environment and often make purchase decisions based on environmental responsibility, sustainability and/or giving back. They opt for recycled/reusable sports bottles over packaged bottled water, and are mentoring their parents to do the same.
Having been raised by “helicopter parents,” this group is optimistic with unrealistic expectations resulting in a very demanding, savvy generation with a lot of “entrepreneurial” spirit. This makes them potentially difficult to manage and hold on to in the everyday workforce, with many companies today struggling to hire and keep Millennial employees past the 2 year mark.
The shopping journey for them is different than the norm, they use technology to gather options – and opinions. 68% of Millennials are looking for a form of peer acceptance prior to making the purchase.
They are highly opinionated and influential trendsetters, seekers and promoters of new brands – Triangl bathing suit, Brandy Melville, Forever 21, Top Shop, Uniqlo, Apple, to name just a few. They learn about brands via social media and then openly discuss their likes and dislikes as a way to learn about what is 'now'. They are smart, trendy, savvy and they know how to extend their dollar. But beware, as they get bored quickly. In a recent study by Indiana University’s Kelley School of Business, when 600 fashion-savvy Millennial students were asked about brands such as A&F, Hollister, Timberland, Michaels Kors and Uggs, they indicated that they had 'grown tired' of these brands which had previously been their go-to items.
The Retailer’s Dilemma: Where is the opportunity?
The Millennial generation demands constant innovation and without it, retailers are at risk of becoming obsolete. But what does innovation really mean? How do retailers innovate fast enough? And how do they satisfy a generation of low loyalists, or loyalists that have low attention spans without alienating or putting at risk other parts of their current business and long time customers?
Retail strategies to capture Millennial consumers:
• Master the 4-Fs – be Fast, Fashionable, Feasible and Favoured
• Turn browsers into buyers by speaking their language
• Innovate through unique offerings that they can’t get anywhere else
• Speak their language (like H&M with the runways)
• Entertain them with parties and selfies
• Keep them in-store longer with charging stations to keep their devices working and free WiFi to help them share with friends
For today’s retailers, it is a balancing act that requires a clearly defined strategy that is nimble, forward thinking, fully integrated and leverages a deep understanding of this ever-changing consumer. Retailers recognizing the uniqueness of Millennials are more likely to see success than those who fail to recognize their nuances.
Source: Retail Insider