Obsessing about Millennial Shopping Habits Is Dangerous
For distribution success, it’s important to keep in mind that the generation we’re a part of isn’t the only thing that influences the way we purchase.
Current times in the retail and consumer goods industry seem prime for presumptions, powerful opinions and easy fixes. In the world of sales, this has too often led us to mistake technology for the whole solution to our problems, instead of only part of the solution. Many retailers have discovered, to their horror, that filling their stores with technological gadgets didn’t increase sales or entice customers. Something similar has happened because of the obsession with generations, particularly with millennials’ shopping habits.
This is not to say that different generations don’t shop and consume in different ways. They certainly do, and it’s essential to keep that in mind. But age is not the only factor that defines us as customers, just as it is not the only factor that defines us as people. There are many other factors, such as gender, income level, culture, income bracket and disposable income.
OTHER ELEMENTS THAT DEFINE US AS CUSTOMERS
Shopping habits are influenced by demographics. To start with, being a man or a woman not only influences the kind of products we buy, but also the way we choose to buy them. For example, according to a study by First Insight, men buy more on the internet and in department stores, and more frequently research via Amazon before going to a physical store.
Also, our income can affect us in obvious ways – we don’t buy what we can’t afford. When it comes to millennial shopping habits, that is a particularly acute issue. A study by the United States Federal Reserve suggests that millennials consume less than other generations simply because they are poorer than members of earlier generations at their age.
Finally, culture and available opportunity where we live shape our preferences in buying, both in the kind of product (which explains the obsession with luxury that Chinese tourists who were raised in poverty have now that they can travel to Europe every year) and the way of acquiring it (in Argentina, unreliable technology and infrastructure result in internet sales being just 3% of total sales).
We tend to overlook other aspects of shopping, too, when we are obsessed with these different generations. For example, it’s easy to forget the distinct differences among generation members and how priorities change over the course of our lives. Today, a millennial may be a little less than 40 years old or a little less than 20. Of course, there is a significant difference between what the youngest and oldest in this group want to buy and their means to pay for it. Being a college student with no commitments is completely different from being married and having children and a mortgage.
And if this were not enough, the past 15 years have taught us that consumer habits can be powerful … and are not limited by the fact that people belong to one generation or another. A report by KPMG shows that Generation X (people born between the mid-1960s and the end of the ’70s) buys more from the internet than millennials. And baby boomers (who are between 63 and 81 years old) make online purchases with the same frequency as millennials. When the categories we use to classify consumers are too rigid, they end up falling apart.
These findings have led some analysts and experts to reject generations as a useful way for understanding customers. But this conclusion is just as presumptuous as the one that generations are the key to our identities or that technology is the solution to all retailer problems.
COMMON TRAITS OF CUSTOMERS ACCORDING TO THEIR GENERATION
These generational studies do help us find the best way to attract our customers. The fact that the studies are not perfect doesn’t mean they’re not useful.
For example, it’s interesting to know that baby boomers (born between the 1940s and the middle of the 1960s) appreciate immediate service, with little or no red tape, that’s repeated and stable. They tend to place more value on the solidity and quality of the product or service than on flexibility and price. And, because of their age, they place greater importance on products having to do with energy, health and well-being. Generation X (born between the mid-1960s and the end of the 1970s) tends to be especially interested in products for the home, the family or small children. Members usually do some research before buying and are more concerned about whether the product serves its purpose than what it costs.
And the millennials and Generation Z? The former, born in the ’80s and ’90s, pay more attention to price, their shopping experience, personal attention, having lots of choices, and speed of delivery. The patterns of Gen Z (born in the 21st century) differ from millennials’ shopping habits. For instance, because they depend on an allowance from their parents and usually live at home, price is crucial. They research potential purchases on the internet and prefer to try out products before buying them.
All this information should be carefully evaluated, and after doing so, it’s almost certainly possible to determine how to turn it into greater satisfaction for customers and more sales for retailers and brands. Be very careful about presumptions and easy fixes. They’re reasonable for the people who propose them, but can be costly for those who decide to apply them to their stores.