NEW YORK: As the Millennial demographic enters its peak spending years it becomes more important than ever for brands and retailers to understand its shopping behaviors, which differ in many ways from those of previous generations, two new surveys suggest.
A study by global management consulting firm L.E.K. Consulting surveyed 3,800 US consumers, including 2,200 Millennials and 200 teenagers and stressed that retailers who want to court Millennials should think more about sub-segments than the whole population.
“By far the most important distinction among Millennials is whether they have children, and their level of education,” according to Shang Saavedra, says Retail Practice consultant at L.E.K.
“Millennials with children and at least a college education spent sharply more than the next-highest spending group in several categories,” she added.
This trend was most evident in home (68% more), but also footwear (56%), electronics (52%), and apparel and personal care (49% each).
Millennials were also far more likely than older generations to pay a premium for convenience and to spend longer online researching purchases.
And while all generations value “brand authenticity”, they define it differently. For older generations, an authentic brand is “genuine” and “timeless”; for Millennials, product quality is less important that “honest values” as they demand products and brands that are associated with social good.
A separate survey on brand loyalty by the International Council of Shopping Centers’ (ICSC), based on a poll of 1,015 US adults, reported that Millennials show the greatest brand loyalty and are less affected by negative brand experiences.
Some 58% of this group said they would buy the same brand of products no matter what. And 80% – more than GenXers (76%) or Baby Boomers (66%) – liked to buy exclusive store branded products because they got good value for their money.
Further, the greater the variety of brands a store offered, the more likely Millennials were to frequent the store, with 80% of them citing variety as a driving force in visiting a store.
Data sourced from ICSC, L.E.K. Consulting; additional content by WARC staff