Friday, June 24, 2016

Millennial Consumer Trends

“Millennials,” generally defined as individuals born sometime between the early 1980s and 2000, are a different sort of consumer than their Generation X predecessors.  For this reason, millennials require research in order for businesses to understand how best to target this generation.

And studying millennial consumer trends is worth it:  By 2020, spending by millennials is expected to reach 1.4 trillion dollars annually.

What do they buy?  Why do they purchase what they do?  Understanding the millennial’s mindset is crucial for business owners who want to keep up with the latest trends.  Read on to discover some of the characteristics that separate the millennial generation from any type of consumer that preceded them.

 

Millennials love technology

Millennials were introduced to technology at a young age.  As computer games and video games developed, technology was suddenly a venue for entertainment, a topic of conversation, and even a social activity.  Chatrooms became popular, and now people could communicate live with their friends or even complete strangers while developing their typing abilities.  By participating in these sources of entertainment, millennials quickly developed an intuition for how technology worked.  This intuition would work in their favor in the following years as new technology was developed.

While a source of entertainment, technology also became essential to every part of life.  Students began to use libraries less and Internet sources more.  Paper maps became obsolete with the invention of Mapquest and the GPS.  Anyone could share ideas or information with the world.  They posted their art, their writing, their poetry.  They learned how to set up online stores and take online payments.  They shared their knowledge and “how tos” with the world.

We can’t forget Bill Gates, still the richest man in the world today, who inspired many.  Millennials live in awe of this man who had started from nothing, only to develop the most widely-used computer operating system in the world.  And a possibility grew in their minds: “I could be someone too.”  This idea fostered the creativity and motivation that would later drive them to develop new technologies to unbelievable proportions.

Today, millennials still love technology.  They use technology to purchase technology.  They love their handheld devices, which function as miniature computers on which they can browse the internet, read books, listen to music – and of course, communicate with phone calls and texts.

How can the business owner take advantage of this trend?

Offer the purchase of goods or services via internet, apps, and even texting when possible.  Businesses should accept Paypal payments and all credit cards.  And any business that sells any sort of service or technology must be fully supported in warranties and customer service.  These practices appeal to the millennial generation today.

 

Millennials are in debt

Instant gratification is very attractive to millennials.  They want faster internet speeds and one-day shipping, and they would rather purchase a couch in “ten easy payments” than save up over time so that they can pay cash.  They owe tens of thousands of dollars in student loans – so they rent, because they can’t afford houses – and when they do buy houses, they add hundreds of thousands to their debt.  In deference to credit cards, tactile cash is rarely used, which lessens the psychological impact of spent money.

Whether or not it is wise to engage in these practices, instant gratification is what millennials want.

How can business owners provide instant gratification to appeal to millennials?

Offer financing programs on every large-ticket item and you’ll be more likely to attract this particular generation.  Advertise “free two-day shipping with a purchase of over $50” and “interest-free financing” and you’ll catch the interest of the average millennial.

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Millennials value community

Despite their “I want it now” tendencies, millennials are finding ways to save money while connecting with their communities.  Many have no problem using programs like Ride Share Online, buying used items from their neighbors on Craigslist, or enjoying “sharing” programs like Airbnb.  They want local; they want handmade.  They want connections, not transactions.

Interestingly, there is a theory that this “sharing economy” ultimately leaves millennials poorer.  Services that emphasize connections and community are facilitated by profit-making companies that have successfully taken advantage of the millennial’s love for community.  A company that can promote a feeling of connection to others will attract the millennial.

How can businesses connect with millennials on a community level?

Get involved.  Get your staff involved in charity. Serve meals to a homeless shelter, have a food drive to support your local food bank, hold a school supply drive to help schools provide low-income children with resources, or hold a “fun run” to raise money for a good cause.

As people associate your brand with community, they will You’ll watch your brand quickly become known as a business that gives back to the community.

 

Millennials are healthy

If they’re not, they want to be – or at least, they’re willing to buy whatever products or foods appear to help them accomplish that goal.  And businesses are happy to respond:  Not only there are plenty of health products and new ways to exercise available, but millennials like to “subscribe” to programs that offer special smoothies, supplements, aromatherapy oils – just about anything, and especially those things that offer to improve health.  Key words like “detox,” “holistic,” and “superfood” abound in advertising.  “All natural” could mean nearly anything.

How can businesses make their products sound “healthy?”

If your product isn’t already in the health product/food business, you may still be able to take advantage of this trend.  “Healthy” buzzwords are used to describe all sorts of non-consumables.  We see shampoos advertised as “gluten-free.”  Yarn is “vegan.”  Toothpaste is organic.

Tack on one of these labels to any item, and suddenly it is associated with health food, which is what millennials want.

Bonus: Millennials don’t just value physical health.  They love the earth and want to fix its environment problems.  They want businesses to be “green,” so plant trees.  Take advantage of renewable energy sources.  Install some solar panels.  And make sure your website tells everyone how you take care of the environment.

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Millennials don’t like advertisements

Internet browsers offer ad blocking extensions.  Free services like Spotify become ad-free with a monthly subscription.  Some radio stations advertise fewer commercials as a way to keep listeners from changing the station; television commercials are become more creative, more inspirational, and funnier in order to engage audiences.  They need to make these extra efforts, because millennials don’t like to feel manipulated.

If ad campaigns are becoming less effective, what other marketing tactics can businesses use to gain customers?

With the rise in popularity of social media over the last decade, millennials feel compelled to share whatever they are thinking.  And if they are impressed with a product or company, they are more likely than ever to share this fact with their friends.  It works like a free marketing campaign, which is why businesses sometimes offer incentives for people who “like” or “share” their pages on social media.

How can businesses take advantage of this “sharing” phenomenon?

Find and engage influencers who will tell their audiences about your product.  Millennials  listen to people they respect.  Then, let your product speak for itself.  Costco, for example, does no traditional marketing, yet was named #1 retailer in the United States by Consumer Report.

 

Conclusion

Millennials are truly a unique group, living in an age that has a completely different worldview and economy than existed when the Generation Xers were young adults.  These differences shape a completely different type of consumer than the past generation.  By studying the influences and mindsets of millennials, the business owner can more clearly understand what millennials want – and then they will be fully equipped to meet demand.

What are some trends you’ve noticed in the millennial consumer?

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