Value is Key to Captivating the Vast Millennial Audience
- Millennials account for 86 million people and have the potential to grow to 88.5 million by 2020. According to the Boston Consulting Group, Millennials are currently spending $1.3 trillion per year. Millennial Shoppers: Positive Mindset Points to Future Growth, a new IRI study, offers advice to trigger purchases from this demographic.
- Initially, Millennials are more sensitive to price than other consumers, with 84% saying that price is a key driver of brand decisions.
- In order to save money:
54% use shopper loyalty discounts
53% use coupons from home
46% refer to in-store circulars
37% react to signs and displays in-store
15% acknowledge online advertising
- To pursue deals:
54% use online resources to find coupons
41% use smartphones to find coupons
25% say smartphone apps with deals influence their brand decisions
40% say “more than half of their last CPG basket was purchased on deal
25% are buying more on deal in 2014 than in 2013
- To save more:
70% compare shelf prices on everyday items
66% compare prices across retailers in the same area
58% choose a store that has the lowest price on needed items
50% comparison shop on retailer websites
47% seek out store brands
- In the first quarter of 2014, 41% of Millennials felt as if their financial position improved in the past year. This can create the opportunity to encourage limited splurges on upscale food items and personal care products. As Millennials evolve into married life and/or parenthood, supermarkets will be fighting for their loyalty. According to Facts, Figures and the Future, in order to succeed with Millennials, retailers need to offer values that they demand, as well as be engaging, transparent and socially responsible.
- A recent Nielsen study found – “More than half of global consumers are willing to pay extra for products from companies with positive social, environmental impact”. Millennials are not willing to pay more for a national brand because it is familiar, instead they want to buy fairly priced products. They also want brands that represent values like sustainability and fair trade with clean ingredient labels.
- When a national brand they wish to buy is not available on the shelf, four in ten choose the store brand; one third pick a different national brand but one in eight look elsewhere for the national brand they initially wanted.
- The Millennials are slowly becoming the consumer group to fight for. With the oldest portion of the group in their married years and the youngest portion of the group just graduating high school, a variety of companies are vying for their attention.
- As Facts, Figures and the Future suggests with their findings, retailers need to evolve with their consumers. The desires of this vastly broad group will continue to drive trends, especially as they gain the buying power of older generations. This group will gravitate to whichever brands satisfy their needs, and will likely desert any brand that does not live up to their standards. Many companies are willing to jump at the opportunity to fit into this group’s lifestyle, so with this fickle group, a brand cannot just sit back and assume that they’ll come around eventually, because they won’t. They’ll continue to get what they want — any combination of value, sustainability, transparency, etc. — and will go to whichever company provides the right combination of those qualities.
- The right way to target this consumer group varies throughout categories, however few things remain the same. Millennials are looking to find a deal, whether they are using specific apps, coupon sites or loyalty programs. Further, brand names are no longer the priority they used to be, specifically in grocery shopping. Companies can gain attention from this consumer group by emphasizing money-saving tools that they offer. This may be in the form of an app, a coupon booklet, or an online deal.