Can they be categorised by birth year or is there more to Generation Z than just age?
Consumers born between 1980 and 2000 are part of the first generation to grow up online. They are the first digital natives. But are they really so different to older consumers?
A new study from Accenture has shed some light. The company surveyed 6,000 consumers, including 1,707 millennials and the results were surprising.
Whilst online shopping is certainly popular with millennials, they still appreciate bricks and mortar stores with 82% preferring to shop in store and 68% wishing to use a mix of smartphones, computers and physical stores. Checking products in a nearby retail store before buying it online is common practice, with 41% admitting to doing this.
The preference for bricks and mortar was greater for certain categories, including beauty with 91% of millennials wanting to shop in drug stores rather than online. Department stores were also popular with 84% preferring these to online and 83% preferred shopping in store for discount/mass merchant products.
Millennials also appreciate loyalty schemes, with 95% wanting to feel like a valued customer. Coupons were said to be the most effective way of winning their loyalty, with money off vouchers sent via email or mail the most popular. Other channels, including text messages, were popular with more than half of this age group.
Millennials are more careful with their money than stereotypes would have you believe. According to a recent survey by Segmint, 30% of consumers in this age bracket are using credit cards to earn credit on summer purchases rather than as a means of funding. Instead, millennial consumers use savings accounts to fund summer spends.
Rob Heiser, President and CEO at Segmint, commented: “Millennials are often wrongly perceived as a group and miscast as carefree when it comes to personal finances. However, the data within this study shows that’s just not the case. It’s important for marketers to understand that this group is actually very conscious of how they approach purchases and are actively taking steps to manage the implications of their spending. These insights are critical to maximising engagement with this attractive group, whose growing purchasing power cannot be denied.”
One thing, however, is clear. This generation is incredibly important to brands. Millennials currently spend around $600bn each year in the US alone. Accenture estimates that this will grow to $1.4 trillion by 2020, when their spending will represent 30% of total retail sales. Ignore them at your peril.