PLANNING FOR 2020: ARE YOU READY FOR THE MILLENNIALS?
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1 PLANNING FOR 00: ARE YOU READY FOR THE MILLENNIALS?
2 PLANNING FOR 00: ARE YOU READY FOR THE MILLENNIALS? Diverse, connected activists, the ME ME ME generation, amiable, tech-savvy, yet minimally employable Millennials (the cohort born between 198 and 001) are simultaneously hailed as adventurous technological innovators and lazy, entitled kids who have abandoned human interaction in favor of a Twitter feed. Yet whether admired or scorned, the truth is that they are highly relevant to the Consumer Packaged Goods industry. pick up private label tissues and milk, but pay a premium for produce from the farmer s market or soap from a local artisan. For the Millennial consumer, it s all about trade-offs. The key, as a retailer or manufacturer, is making sure that your product isn t the one being traded out. AVERAGE BASKET RING THE MILLENNIALS ARE COMING By 00, millennials over the age of 5 will make up 0% of the US population. 1 Their purchasing power is nothing short of staggering. With current spending power to the tune of $00B, Millennials will be responsible for 30% of retail purchases by Contrast this with members of the Boomer generation, whose in-home food spending could decrease by as much as $15B. 1 It is clear that both brands and retailers need to position themselves to win as Millennials come of age. PERCEPTION OF VALUE The key to understanding Millennials retail behavior is a consideration of what they value and what they are willing to pay for. After coming of age in an era of political and economic turmoil, Millennials are remarkably valueconscious. They are willing to pay a premium for specific qualities they deem worth it. While Millennials are 1% less likely than Boomers to prefer branded products, they are also 15% more likely than Boomers to pay more for natural or organic products. 1 The brand itself is less important than what it stands for. They may be happy to $38 GREATEST GEN $45 BOOMERS FIGURE 1 4 $5 GEN X $53 MILLENNIALS Millennials are valuable shoppers, with an average basket spend 3% higher than the average shopper. HOW DO YOU FIT INTO THE MILLENNIAL VALUE PROPOSITION? Knowing what Millennials value and what they will pay for is an important first step in remaining relevant to this generation. Three key characteristics of Millennials influence their retail behavior: they are socially conscious, seek new experiences, and intertwine their digital lives with their offline reality. Seurat Group Planning for 00: Are you ready for the millennials?
3 CONSCIOUS CONSUMPTION their own greatest adventure. This contest appealed to Millennials worldly and eclectic interests, and smartly made Dos Equis a part of this energetic mindset. 5% OF US MILLENNIALS BELIEVE THEY CAN MAKE A GLOBAL DIFFERENCE FIGURE 5,6 1 IN 3 LOOKS FOR BRANDS THAT HAVE A POSITIVE IMPACT ON THE WORLD This explains why idea brands - brands that connect a product with a cause - are especially popular with Millennials. For proof, look to shoe company Toms and glasses maker, Warby Parker, both of which donate a pair to a person in need for every purchase made. In 4 years, Toms Shoes amassed an estimated $33M in sales, 7 while Warby Parker cleared out its inventory in the first three weeks of business, and amassed a waiting list of 0,000 people. 8 Both brands have authentic, well-developed brand stories that Millennials highly value. PLAN ON...STAYING ON THE CUTTING EDGE Whether it means introducing seasonal colors, special edition flavors, or ethnic-inspired products, it is crucial that Millennials perceive your brand as fresh, dynamic and a trusted partner in their search for the newest great thing. Invest in innovation to keep abreast of the latest trends in your industry, and be aware of the opportunity that e-commerce provides in terms of expanded assortment and customization options. STAYING CONNECTED Perhaps the most universally agreed upon characteristic of a Millennial is that they are masters of technology. Today, 75% of Millennials have a profile on a social media site and 83% report sleeping with their phones next to their beds. 9 PLAN ON... CREATING BRAND, PRODUCT, AND RETAIL EXPERIENCES THAT RESONATE WITH MILLENNIALS Careful attention must be paid to developing a cohesive brand story and communicating that story to consumers and shoppers. Whether it s involvement in an admirable cause, a focus on sustainable packaging, or simply the promise of consistently high quality, you must give shoppers a substantive way to connect with your brand. For Millennials, the brands they choose are a reflection of their values; make sure your brand embodies values they want to reflect. QUEST FOR NEW Millennials crave new experiences and adventures. They are 5% more likely than Boomers to say that they would like to try everything from opera to rock-climbing, and % more likely to want to visit every continent in their lifetimes. Smart brands understand and cater to these adventurous tastes. Dos Equis, an American beer brand with a Millennial-male target audience, launched Stay Thirsty Academy, a website celebrating consumers unique accomplishments and offering grants to help them have This constant connectedness affects their consumption behavior in two ways: 1 Digital natives expect seamless integration of their virtual and physical lives They turn to their virtual networks to find and share opinions. H&M, an apparel store popular with teens and twentysomethings, demonstrated a keen understanding of the millennial mindset when they created their Goldrun app. The app allowed shoppers to virtually try on items in store windows, share the look on Facebook, and receive 10% off their purchase. In one campaign, shoppers could interact with the brand on multiple devices and receive peervalidation in the form of Facebook likes on their chosen looks. The importance of creating a shareworthy brand cannot be overstated. 70% of Millennials say they are more excited about decisions if their friends agree with them, 10 and 84% say that user-generated content online has some influence on what they buy. 11 Seurat Group Planning for 00: Are you ready for the millennials? 3
4 PLAN ON...INTEGRATING ONLINE AND BRICK AND MORTAR EXPERIENCES Investing in your firms omnichannel capabilities is a wise choice early on, as early movers in achieving fully integrated digital and brick and mortar experiences are likely to maintain an advantage in this realm. Providing an outlet online for Millennials to celebrate your brands serves both as a way to create greater emotional connectivity with the brand and as a valuable source of feedback from the next generation of buyers. Millennials are often treated as an enigma, but they have a core set of values and habits that can be studied and understood, just like any other generation. By engaging them with an authentic brand story, appealing to their desire for new, and staying ahead of the digital curve, you can earn a spot on these shoppers lists. Remember, 00 and the Millennials- are coming. Are you ready? Contact the Seurat Group to learn more about ways to ensure your brand or retail experience is ready for the Millennials. info@seuratgroup.com Sources: 1 Jefferies and Alix Partners. Trouble in Aisle 5. June 01. Barkley. American Millennials: Deciphering the Enigma Generation Accenture. Seamless Retail for Millennial Customers. Getting It Right Yarrow and O Donnell. Gen BuY. How Teens, Tweens and Twenty- Somethings are Revolutionizing the Marketplace Teléfonica Global Millennial Survey. 013; SocialMedia Today. Harnessing the Power of the Loyalty Generation. June SocialMedia Today. Harnessing the Power of the Loyalty Generation. June WSJ. Charity Gives Shoe Brand Extra Shine. 010; Warby Parker Co-Founder Says Initial Vision Was All About Price Warby Parker Co-Founder Says Initial Vision Was All About Price Pew Research Center. Millennials: A Portrait of Generation Next. February Retail Customer Experience.com. Idea brands will win big with Millennials: Here s how to attract them. September 013;. 11 Bazaarvoice.blog. Millennials Will Change the Way You Sell. January 01 Seurat Group Planning for 00: Are you ready for the millennials? 4
5 Contact us at: (03) Connecticut Office: 41 North Main Street, Norwalk, CT New York Office: 1115 Broadway, 11th Floor, New York, NY For more information about Seurat group visit SeuratGroup.com
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