[{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/www.the-future-of-commerce.com\/2014\/05\/06\/the-age-of-the-millennial-what-that-means-for-retail\/#BlogPosting","mainEntityOfPage":"https:\/\/www.the-future-of-commerce.com\/2014\/05\/06\/the-age-of-the-millennial-what-that-means-for-retail\/","headline":"The age of the millennial: What that means for retail","name":"The age of the millennial: What that means for retail","description":"They\u2019re the most talked about generation in retail, but also the poorest. They love to shop, but are less likely to make a purchase. So what\u2019s the millennial appeal? Why are so many retailers in a race to win this demographic, when their characteristics appear to be less than conducive to the bottom line?","datePublished":"2014-05-06","dateModified":"2021-08-04","author":{"@type":"Person","@id":"https:\/\/www.the-future-of-commerce.com\/contributor\/admin\/#Person","name":"From The Editor","url":"https:\/\/www.the-future-of-commerce.com\/contributor\/admin\/","identifier":2,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/f6b4d01c0a2a6beaf559e7b1674e57e2132bcc97fb9c5917786acc398639d6a6?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/f6b4d01c0a2a6beaf559e7b1674e57e2132bcc97fb9c5917786acc398639d6a6?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"The Future of Commerce","logo":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2023\/01\/logo-foc-schema-app-1.png","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2023\/01\/logo-foc-schema-app-1.png","width":172,"height":60}},"image":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2014\/05\/millennials-studying.jpg","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2014\/05\/millennials-studying.jpg","height":350,"width":550},"url":"https:\/\/www.the-future-of-commerce.com\/2014\/05\/06\/the-age-of-the-millennial-what-that-means-for-retail\/","about":["B2C Commerce",{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/commerce\/","name":"Commerce","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Commerce","http:\/\/www.wikidata.org\/entity\/Q26643"]},{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/marketing\/social-media\/","name":"Social Media","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Social_media","http:\/\/www.wikidata.org\/entity\/Q202833"]},{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/commerce\/trends-commerce\/","name":"Trends","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Fad","http:\/\/www.wikidata.org\/entity\/Q787045"]}],"wordCount":1171,"keywords":["E-commerce","Marketing","Retail"],"articleBody":"By\u00a0Kelsey LindseyThey\u2019re the most talked about generation in retail, but also the poorest. They love to shop, but are less likely to make a purchase. So what\u2019s the millennial appeal? Why are so many retailers in a race to win this demographic, when their characteristics appear to be less than conducive to the bottom line?The answer is in the numbers. Comprising of nearly a fourth of the population, Accenture\u00a0predicts\u00a0the millennials’ $600 billion in annual marketplace spending will rise to $1.4 trillion by 2020, representing 30% of total retail sales.To better reach this group ranging in age from 18 to 33, retailers can turn to Pew Research Center\u2019s extensive survey released last month,\u00a0\u201cMillennials\u00a0in Adulthood.\u201d From institutional detachment to economic challenges, the characteristics and insights stemmed from this report may just help form the future of retail.They\u2019re facing a range of economic hardshipsWhile millennials are the best-educated generation of young adults in American history, they are also one of the most monetarily lean. Recent graduates are leaving college with a staggering $27,000 average student loan debt, and the Center for American Progress\u00a0claims\u00a0that a\u00a0recent study\u00a0shows \u201cthat Millennials are more likely than older Americans to face direct economic problems.\u201d These hardships\u2014coupled with an economic outlook shaped by lingering impacts of the Great Recession\u2014make it imprudent for retailers to overlook millennials\u2019 financial challenges.These hardships have conditioned millennials to search for the best prices in retail. “They were born and raised in tight financial age and retailers have to adjust to that,” says\u00a0Marti Tedesco, senior director of marketing at Baynote. And with unlimited access to information through smartphones, they have unlimited tools to save, using\u00a0geo-targeted promotions\u00a0and\u00a0in-store price comparison\u00a0apps to cater to their demands to find the right price, now.But this impatience can come as an advantage for retailers, according to Jason Baker, a principal at retail consulting firm Baker Katz based in Houston. Baker predicts that physical stores will maintain a competitive edge over online competitors based solely on their ability to provide millennials what they want, when they want. No shipping speed can compete with the seconds-fast gratification of purchasing in-store, at least\u00a0not yet.Millennials\u2019 tight budgets may also be contributing to the\u00a0growing popularity\u00a0of fast fashion. Unable to afford the pricey, quality clothes of luxury brands, some turn to retailers like H&M and Zara to fill wardrobes with affordable, fashion forward basics and trendy pieces. While others in the industry\u00a0disagree\u00a0with this budget blanket statement, asserting that the tide will eventually change toward more quality and sustainable goods, the success of these retailers (and the conversion of some\u00a0to fast fashion) is a sign of the expanding road of fast fashion.They\u2019re digital nativesEmploying the buzzy term \u201cdigital native,\u201d Pew Research describes millennials as the only generation to have mastered new digital platforms\u2014mobile technology, the internet, and social media\u2014without any adaptation. These technological advancements are so innate within millennials\u2019 lifestyles that retailers must adopt strategies to connect through digital devices\u00a0in store. Maintaining a savvy, navigational, and engaging website has become the norm for retailers — one established years ago. Technological expansion beyond the web is a critical next step to reach this generation accustomed to multi-platform interaction.According to a MIT report titled \u201cBeyond the Checkout Cart,\u201d 80% of store shopperscheck prices online, with one third of these shoppers comparing prices in physical stores on their mobile phones. Capitalizing on this instinctive trend (and to prevent the consumer from fleeing for a better price elsewhere), retailers have integrated\u00a0mobile-friendly features into the in-store shopping experience.Visitors to Macy\u2019s enormous flagship store in New York can use its free\u00a0app\u00a0to access menus to in-store restaurants, book reservations for Santaland, and obtain in-store directions. Nationwide, the retailer offers a barcode\/QR code scanner that gives guests instant access to product descriptions and videos. This strategy has brought Macy\u2019s distinctive\u00a0success, with $2.19 billion in operating cash flow last year.They\u2019re less loyal\u2014so they expect morePew\u2019s survey also notes that millennials tend to be less loyal to political parties and religious organizations, and less trusting of others when compared to previous generations. This disaffiliation may have transmitted itself somewhat to industry trends, with the one-brand consumer becoming more and more obsolete. But while the constant state of deal-hunting by millennials has decreased the reliable business of yesterday, it still may be possible for companies to attract younger consumers that will stay loyal to them for years to come.To accomplish this task, brands have created content that interacts with millennials. The first step is to gain consumer trust and interest through discreet advertising and an interaction outside of the product. Writing for\u00a0Quartz, chief economist Venkatesh Bala states that retailers\u2019 \u201crelationship with millennials must continue long after they exit the doors.\u201dBrand-produced\u00a0magazines, a strong Pinterest\u00a0presence, and\u00a0social\u00a0mediaaccounts\u00a0focused on the brand\u2019s lifestyle rather than the product are three examples of successful\u00a0content marketing. Kate Spade\u2019s\u00a0Behind the Curtain\u00a0blog offers multiple \u201ccolumns\u201d that include\u00a0guides\u00a0to trendy cities and\u00a0how to\u2019s\u00a0for making glitter fortune cookies and perfecting a French twist. Besides the company\u2019s name and logo branded at the top of every page, this blog is more of a lifestyle publication than website pitching Kate Spade wares\u2014a discreet marketing strategy that might have contributed to some of its\u00a0recent success.This type of customer engagement has positive long-term effects for companies beyond short term interactions. Reporting on new research by Garner, Inc.,\u00a0Loyalty 360\u00a0claims that \u201can actively engaged customer is more willing to participate with the organization through multiple different channels\u2026they are more willing to provide feedback when asked, make best use of the products or services on offer, and make suggestions on how to improve them.\u201dFree People clothing brand is a prime example of this content give-and-take retailers are experiencing with younger customers. The company\u2019s professionalBLDG 25 Blog\u00a0offers \u201cinsight into the illuminating culture of Free People,\u201d covering many aspects of the \u201ccreative, independent, impressively-bold and free-spirited FP girl\u201d with little mention of the company or its products. This investment seems to have paid off: A visit to Free People\u2019s retail website will reveal active reviews on many of their products, including\u00a0photos of customers\u00a0modeling its wares.Examining trends associated with these three millennial leanings, retailers might be able to attract this seemingly fickle demographic and their long-lost loyalty. This can have positive repercussions, especially if millennials\u2019 confidence in their long-term economic prospects stem true\u201485% believe they make, or will make, enough money to lead the lives they want in the future. Call it timeless optimism, blind confidence, or stubborn denial. Either way, it makes for good retail.  Relationship status: Complicated.AI in e-commerce is critical, but obstacles around data privacy, talent, and integration are slowing adoption. Our powerhouse panel has the stats + strategies you’re looking for. 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