What do Millennials and Generation Z consumers want from retailers?
Four generations of consumers coexist today: the Baby Boomers, born between 1945 and 1968; Generation X, born between 1969 and 1983; Millennials, born between 1985 and 1993; and Generation Z, comprising those born from 1994 to 2002. Catering for the needs of younger generations is key for many businesses’ long term growth strategy, as millennials currently form the largest generation in the US labor force. FashionUnited has taken a look at the latest research about millennials and Generation Z to find out who they are and what they want.
They mistrust businesses and want to see them do more for society
Only 48 percent of millennials believe corporations behave ethically and that business leaders are committed to helping improve society, according to Deloitte’s 2018 Millennial Survey. The consultancy firm interviewed 10,455 millennials and 1844 Generation Z respondents in Australia, Canada, China, India, the UK and the US. 67 percent of surveyors believe most businesses have no ambitions beyond wanting to make money.
An overwhelming amount of Millennials and Generation Z members (over 80 percent) consider social and environmental practices to be just as important as a company’s financial results. Criteria deemed as highly important for the surveyors include: positive impact on society and the environment; inclusion and diversity in the workplace; job creation and career development opportunities for employees; and innovative ideas, products and services.
American footwear brand Toms exemplifies the kind of fashion company millennials like. Toms is best known for their “one for one” program, in which a pair of shoes is donated to a person in need with every product purchased. “We’re in business to help improve lives”, the brand says on its website. According to a worldwide brand value index made by marketing agency Enso in 2016, Toms ranks higher than Nike among millennials, even though the former is only a fraction of the latter’s size.
While both are believed to be “post-PC” generations, older millennials are more likely to buy desktop and laptop computers than any other age group, including Generation X and Baby Boomers, according to Deloitte. The consultancy firm says millennials see smartphones and PCs as complements, not substitutes. A study about online shopping habits conducted by KPMG in 2017 corroborates this argument. They interviewed 18,430 consumers from the Baby Boom, Gen X and Millennial generations. Only 11 percent of surveyed millennials said their most recent online purchase was made via a smartphone.
But millennials might be the last generation to prefer PCs. According to Pew Research Centre’s latest report on teens, social media and technology, published earlier this month, smartphone access is nearly ubiquitous among US teenagers, while having a home computer varies by income. A staggering 95 percent of American teens have access to a smartphone in 2018 (a 22 percent increase in comparison to 2014), while only 88 percent of them own a desktop or laptop computer. 45 percent of the surveyed teens said they are online “almost constantly”.
They are getting more and more visual
While blogs, Facebook and Twitter dominated the social media landscape four years ago, photo and video-based platforms are taking the lead in 2018. Only 51 percent of respondents reported using Facebook in Pew Research Centre’s most recent research with US teens, down from 71 percent in 2014. YouTube, Instagram and Snapchat are far more popular than Facebook among consumers aged 13 to 19, with 85 percent of Generation Z consumers using YouTube, 72 percent using Instagram and 69 percent using Snapchat.
As the last generation that has lived part of their lives in a world without widespread Internet access, Millennials are slower than Generation Z in using Snapchat and Instagram. Only 54 percent of Americans aged 25 to 29 are Snapchat users, while 57 percent of them use Instagram.
Youtube seems to be the safest bet for businesses looking to reach both generations via social media, as it is used by 80 percent of Millennials. Chanel is a good example of a brand that is performing well on YouTube: the brand’s channel currently has over 1.1 million subscribers.
They enjoy shopping online just as much as they enjoy brick and mortar stores
One may be led to believe physical shopping is at risk, considering how much time Millennials and Generation Z spend online. But nothing could be further from the truth. While these two generations are indeed savvy online consumers, they still enjoy shopping at physical stores. 48 percent of surveyed Millennials in KPMG’s 2017 survey reported their most recent online purchase was from an e-tailer. However, the same research pointed out Millennials have a much higher demand for instant gratification than older generations. They are almost twice as likely to say they’d rather visit shops to get their product right away, rather than buy online and await delivery.
Another recent study carried out by behavioral marketing firm SmarterHQ in 2017 claims 50 percent of Millennials not only do go to physical stores, they actually prefer going to them as a primary means of shopping. Although more connected and more inclined to use smartphones, Generation Z isn’t much different. A study released last week by commerce marketing company Criteo points out that 65 percent of Generation Z consumers dislike buying things without being able to touch them and 34 percent of them frequently research about products online, but buy them in store.
"While specific shopping habits may vary, Gen Zers are native omnishoppers who like to visit stores but still prefer to take care of their shopping needs online. In order to deliver a personalized experience on all touchpoints, brands and retailers need to employ a data-driven approach to connect Gen Z customers with unique, on-trend products", said Criteo’s Chief Strategy Officer, Jonathan Opdyke, in a statement.
Pictures: Courtesy of Toms, Pixabay