Targeting Millenials has been the focus of retailers all across the Globe for some time now. It does not require a wise man to fathom the fact that in the time to come, this trend will continue. The potential purchasing power of Generation Y along with their total strength existing in the world is what is making the retailers stand up and take notice. The following numbers provide a fair indication.
According to data provided by KPMG,
Out of a massive 2.5 billion millennials worldwide, around 90 million are from North America alone. The estimated annual buying power in America alone is over US $200 billion.
Out of the total strength of new moms, a hefty 83% belong to the millennial category. Around 61% of millennial new moms feature in the workforce.
The total spending power of millennials will be more than any generation by 2018.
According to Statista.com, the annual expenditure of Generation Y is expected to rise from US $600 billion in 2013 to US $1.4 trillion by 2020. Retailers know that individuals belonging to the millennials category are tech savvy and have a high purchasing power. But they still need to be influenced and stimulated for a purchase. Retailers are trying to accurately trace their shopping habits and figure out what they exactly want. Here is what every retailer across the globe should know about their millennial consumers.
They believe in reviews over advertisements
A 2015 study by Forbes revealed that a negligible 1% of individuals believe that advertisements could make them trust a brand more as opposed to 33% relying on blogs and reviews before making a purchase.
A 2016 study by PWC claims that 67% of customers feel that their shopping behavior is influenced by social media reviews.
A recent study by Hanover Research tells us that around 50% of millennials use their mobile phones to research about products and reviews.
Millennials believe in the reviews of their close associates and peer group. For this purpose, they indulge in checking blog posts and reviews before making a purchase. Retailers and brands should encourage things like brand reviews, personal stories from existing customers, etc across various social media platforms like Facebook, Twitter, Instagram, etc to generate interest instead of wasting time and effort over devising the perfect advertising campaign.
They appreciate social engagement with brands
Millennials love social media. This fact has been long established. Hence, they naturally like to resort to social media for engaging with a brand. Therefore, brands and retailers should try and develop connections over social media across various platforms to best attend to their consumers. According to a 2015 survey by Forbes, 62 % of millennials are more likely to be loyal with a brand if it engages with them over social media. Whether the idea is to attain brand information or lodge customer service complaints, millennials prefer doing it by engaging with their brands online over social media. The following statistics totally support this fact.
According to Microsoft's New State of Global Customer Service Report (2016),
47% of millennials use social media to lodge a complain about a brand's customer service and 52% use it to use customer service questions.
64% of the people feel that social media is the most effective channel for brands to provide customer service.
Indulge in CSR: It is possible to attain brand loyalty among millennials. For that, retailers need to consistently indulge in giving back to the society. Various studies have depicted that millennials closely associate themselves with brands that aspire to do something for the society, instead of just earning profits and 75% of people agree to this according to a recent study. According to the 2015 Cone Communications CSR study, nine out of ten millennials would switch brands to the ones that actively engage with CSR. Not only do they feel for their community but also appreciate brands that make a contrubution. This is one way brands can expect brand loyalty.
Proliferate Loyalty programmes: Another way of earning loyalty is by the proliferation of loyalty programmes. Millennials want fun in return of them sticking to a brand and this fun is often in the form of discounts, coupons, reward points, etc that make up the loyalty programmes. According to data provided by Entrepreneur.com, 69% of people belong to a retail loyalty programme and 70% of them are happy with the programmes. With number of options and channels available at their disposal, it's important for brands to provide effective loyalty programmes to their customers if any type of loyalty is to be expected in return.
Smartphones Predominant, but other tech devices popular too
It's no rocket science to understand that smartphones is the 'Go-to' device for shopping for majority of the retailers' consumer base including the millennials. Entrepreneur.com (2015) also claims that 89% of millennials use the smartphone to connect to the retailer. Laptops, tablets and desktops account for 75%, 45% and 37% respectively. Forbes states that 30% of this population is scheduled to purchase a wearable device in the next five years. This means that retailers should definitely have a mobile first strategy for the consumers, but should have an effective strategy laid out for the other devices as well. Various findings reveal the amount of comfort that millennials derive out of using mobile apps for shopping. All these various aspects have to be kept in mind by retailers as they look ahead for a brighter future.