BOSTON: Retailers should update their strategies to accommodate the expectations and preferences of US millennial consumers or risk missing out on the opportunities presented by the growing e-commerce market, a new report has warned.
In a joint survey of more than 1,000 US retailers and millennial shoppers (defined as consumers aged 18 to 29), technology specialists Merchant Warehouse and RetailPro International found that 49% of retailers have not yet established an e-commerce presence.
Even though e-commerce sales are expected to grow to $440bn by 2017, it emerged that almost one-third (31.2%) don't have an e-commerce presence at all while only 7.5% are in the process of building one. The remaining 11.8% are researching the possibility.
The report, an infographic entitled "Buyer Knows Best: Retailers, Millennials and Omni-Channel Shopping", found that US millennials have purchasing power worth $200bn a year and that 40% of men and 33% of women of that generation "would buy everything online if they could".
Yet despite their inclination towards online shopping, the study found that US millennials are still buying mostly in physical stores, but they like to use their mobile devices while in-store to access information, discounts and reviews.
Nearly 85% researched products before purchasing, but far fewer (53%) found their shopping experience at their favourite retailers to be "seamless" – and 78% of those who did not find the process seamless said retailers' websites failed to deliver.
As well as recommending that retailers improve their websites, the report highlighted the potential worth of coupons and discounts.
It found that 75% of consumers said they would switch to brands that delivered real-time discounts and promotions to their mobile devices while shopping, yet only about a quarter (27.3%) of retailers offered mobile coupons to their shoppers.
Furthermore, 84% of consumers said they were more likely to visit websites of retailers with loyalty programmes, yet only 8.4% of retailers offered integrated loyalty programmes that covered all channels.
In a final, and dramatic, warning to retailers about the technical aptitude and purchasing power of the millennial generation, the report stated: "Bring your business into the future, or you may get lost in the past".
Data sourced from Merchant Warehouse, RetailPro International; additional content by Warc staff