It’s a fact. Millennials spend money. They’ve been spending money for years, and according to recent statistics, they are continuing to spend their money at an increasingly fast pace. By 2018, this group of 18 to 34 year olds (which is currently 80 million strong), will easily surpass baby boomers’ spending with an astounding $3.39 trillion!
Retailers are well aware of the millennials’ extraordinary strength, power and influence, but many are at a loss when it comes to targeting this important demographic. With the gift giving season quickly approaching, it’s easy to understand why retailers all over the country are scrambling to find the best ways to communicate with this influential group, gain their trust, secure their loyalty, and capture a significant piece of their holiday spending dollars.
With previous generations, retailers found it somewhat easy to create brand loyalty. They knew they could count on repeat business to take them through the holidays. Not so much with millennials. With this demographic, repeat business and brand loyalty are much more difficult to come by. Studies have shown that millennials are the least trusting generation, so retailers need to work that much harder to gain their confidence.
If targeting millennials is on your holiday TO-DO list, here are three things you need to know in order to understand how they think and how they shop.
They’re Fine with Early Holiday Promotions
Millennials have grown up watching the holiday season kick-off earlier and earlier. According to a study by RichRelevence, they are the least annoyed by seeing holiday sales and promotions before the official start of the season, and come to expect them before Halloween is even over! This is certainly something for retailers to consider when marketing to millennials. Yes, it’s okay to start pushing holiday specials early!
They Don’t Buy Right Away
Even though they are okay with holiday promotions starting earlier in the season, it’s important to note that it doesn’t prompt millennials to buy any sooner. A study conducted by Nielsen found that millennials put off holiday shopping longer than other age groups because they know that the holiday season is loaded with deals whether it’s October, November or the day before Christmas! Don’t be discouraged if sales are sluggish early in December. They are sure to pick up.
They’re Ready to Spend and Love a Good Bargain
It is estimated that millennials spend approximately $600 billion annually, and The National Retail Federation (NRF) expects an average increase of 4 and 4.5% in millennial retail spending this holiday season. While millennials are ready and willing to spend money, they are always looking for good bargains. In one study by Accenture, one millennial mentioned that if she is unable to use her online coupon or discount in the store, she will walk out without purchasing anything! Lesson learned; honor the store’s online coupons whenever possible or provide a similar in-store discount to keep the millennial happy.
Kill ‘Em With Kindness!
Many retailers are concerned that millennials don’t seem to show strong loyalties to any particular brand. However, millennials tend to disagree. Studies show that they appreciate and value a shopping experience that is targeted to them. They like to walk into a store and be asked how they are. They want to go online and easily find what they need. This holiday season, industry experts believe that personalized coupons and emails are sure to help millennials feel connected to a retail brand, so consider including them as part of your holiday marketing plan.
Understanding who the millennial is and how he or she thinks and shops is imperative to creating the promotions and events that will draw them in and encourage them to open their wallets.