August 21, 2013
Retail Customer Experience: What Will It Take to Solve the Millennial Mystery?
Through a special arrangement, presented here for discussion is a summary of a current article from Retail Customer Experience, a daily news portal devoted to helping retailers differentiate the shopping experience.
In 1939, Winston Churchill famously called Russia "a riddle, wrapped in mystery, inside an enigma."
These days, the same can be said in reference to Millennials.
As brands continue to study and decode the Millennial demographic in order to effectively woo them into their businesses, it’s important to remember how much things have changed in such a short amount of time. Lessons from business school’s Marketing 101 don’t apply anymore.
This is according to Jeff Fromm, executive vice president at ad agency Barkley. Fromm has 25 years of brand marketing experience and is the founder of Barkley’s Millennial Marketing Conference, as well as co-author of Marketing to Millennials: Reach the Largest and Most Influential Generation of Consumers Ever.
He spoke on a panel at the Retail Customer Experience Executive Summit this week in San Diego, sharing the five following insights about Millennial consumers:
- "The definition of brand value we’ve known has died. It’s not enough to have functional and emotional products, we’ve now entered an era of participation economy," Mr. Fromm said. Participation means the consumer helps co-create products and services, through social media or other marketing channels.
- Participation is important because consumers now want brands that have a purpose that aligns to their personal values. "It’s about me now, not the brand," Mr. Fromm said. "Useful is the new cool." An example of this is Yelp Monical, an app that allows users to point their smartphone in a certain direction and then list restaurants in that direction.
- Krispy Kreme’s Hot Light mobile app is an example of "useful," according to Mr. Fromm. The app, originally introduced in 2011, alerts users whenever their local Krispy Kreme rolls out hot, fresh doughnuts. The brand’s Hot Light has long been an iconic part of its history, which "lives to thrive" through this app, Mr. Fromm said. The app generated 42 million searches in the first year alone, before many brands even had such a mobile component.
- Millennials don’t necessarily embrace things that used to work for a brand. "They embrace disruption in the industry," he said.
- Finally, Mr. Fromm calls Millennials the savviest group of consumers ever. This is mostly because they’re digital native," rather than "digital learned."
Discussion Questions
What would your list of the distinct attributes of the Millennial consumer include? What does the Millennial definition of a useful product mean in practical terms for retailers?
Poll
BrainTrust
Recent Discussions
More Discussions
How Can Retailers Crack the Gen Z ‘Riddle’?
Gen Z is becoming an increasingly important consumer demographic, but an elusive one to map. How…Does Bath & Body Works’ Scented Holiday Campaign Pass the Sniff Test?
Bath & Body Works is kicking off a new campaign with scent being at the fore…Which Tech Will Solve In-Store Inventory Woes?
Three major tech lineups are looking to solve retail inventory problems. Which is most suited?
Millennials are no longer bound by the marketing methods of “old media.” They don’t read the print newspaper and they watch conventional network or cable TV less frequently. Habits altered by tablets and the ability to binge-watch (without commercial interruption) can’t be ignored by advertisers.
As a result, in some ways Millennial consumers are more dependent on peer influence to help form opinion than their parents or even their grandparents. Technology has moved “word of mouth” from the backyard fence to the social network and the review site, but it is a powerful and growing influence on behavior.
All generations, beyond just Millennials, are influenced by peer-to-peer interactions. For decades, the biggest contributor to purchase influence has been friends and family. That’s why it’s vital for retailers and brands alike to ramp up customer/consumer engagement in an integrated manner—in the community, online, and in the stores.
Creating a mutual feedback loop that allows for a more productive relationship around shared purpose is a clear path to success. That’s how interactions can become transactions.
Friderika “Frida” Wollweber is a pro in the area of Fashion Marketing and is the founder of Fashion Seduction Blog (www.fashionseduction.com) which is dedicated to her style as well as her interest in luxury fashion.
Her read on the Millenials:
The Russian issues of the old days were easy compared to the challenge that retailers face today. Just be authentic and serve them well, and these Mill’s will come back with friends!
Tom…Father of 4 Mill’s….
Instant gratification. That is the new norm for the Millennial—they expect to get it when they need/want it. Useful is being ready to use when they want it to solve a problem and not be intrusive to the transaction. Cool without purpose has no relevance to the Millennial.
If the question—as written—is, “Is there something unique about Millennials’ consumer behavior?” then the answer may be “No.”
Millennials share the same consumer ecology as Boomers, Gen Xers, Gen Ys, etc. They use the same technologies and are shaped by the same zeitgeist. They aren’t the only cohort to use social media, or apps, or anything else for that matter.
Perhaps marketers would be better served trying to understand actual changes in the big social/cultural picture rather than perpetually focusing on trying to jam entire generations into neat, discrete pigeon holes.
Just a thought.
Retailers should strive to be cool and relevant for Millennials. I tend to think Millennials relate things to themselves not in a selfish way, but in a relevant way. Being digitally native, they’re constantly thinking what now, what next, how can I make it faster, how can I make it better, and how can I move quickly to the next important thing?
When products are useful, they have properties that are helpful in everyday life. There’s a social component involved because that’s how we live—socially. In practical terms for retailers, it’s not about scaling up, it’s peeling back. Millennials have seen all of the marketing tricks from the past, and don’t require any of those. Millennials would like you to come from a “real” place, stripping down all artifice and showing the brand in a socially impactful way.
As a Millennial, I think we’re still figuring out who we are since most of us are at that stage in life. The usefulness of a product to define ourselves is in practical application. Personal branding is a reality that can’t be ignored.
Education takes time and costs a lot of money. We all know this, but fail to realize the necessity in continuance. Companies willing to invest in market research must do so at closely tied regular intervals with a willingness to start over if the information obtained can not be put to profit-taking use.
Monitoring what software and hardware platforms are teaching and entertaining at elementary, high school, college, and post grad levels will give marketing gurus a direct knowledge of where and when to approach people growing into the consumer market. The Information Technology industry uses this opportunity to teach individuals at an early and ongoing pace the benefits of their specific products. This is how young adults are aware to ask for product by name and to purchase at a specific site. Discovery and participation in these places of work and play can bring early and growing reward.
Distinct attributes for Millennials include intelligence, hightened awareness, BS adverse. This is a problem for marketers because they are having difficulty pulling the wool over they eyes of the Millennials. Apparently they value honesty and are the first to sing the praises of that which makes sense to them. It’s going to be hard to peddle stuff to them in the same way as their ultra materialistic parents.
I’m the mother of two Millennials. One important characteristic is their belief that anything can/should be instant. When they’re in pursuit of a product, they’ll make a quick decision about what they’ll buy, and where. Our generation would put up with out-of-stocks, but Millennials won’t. Better inventory visibility is going to be a must.
I don’t really buy the idea of grouping an age range and thinking they as a group have unique characteristics. There will always be far more different needs across individuals than there are unifying characteristics of the group.
Having said that, the world is clearly getting faster. “Instant” is more important than ever, across many age groups. Yes, for Millennials, it is native, but it’s true for older folks too and will be even more true for my post-Millennial 4 year old.
What it means is that companies need to devalue intensive planning and increase the value of rapid innovation and experimentation. This isn’t new either, but it is accelerating. Trying a much broader range of innovation ideas + a “fail fast and double down of success” mentality will be the only sustainable way forward.
I like the impact Millennials wield as consumers and think the term “participation economy” is spot-on. Lately we have been commenting on the implications of crowdsourcing, crowdvoting and curation in retail and Millennials are driving these changes, and therefore, our conversations.
One facet of Millennials that needs to be mentioned is their desire to act on their social conscience and the fact that this affects their consumer behavior.
I think a deeper definition of a “useful product” should include the need to have a social connection, and even better, make a social statement.
Also want to add that I am truly impressed with the Millennials that I work with on a daily basis.
Forgive me for a direct plagiarization, but Ed Dennis says exactly what I wanted, only better… “Distinct attributes for Millennials include intelligence, heightened awareness, BS adverse. This is a problem for marketers because they are having difficulty pulling the wool over they eyes of the Millennials. Apparently they value honesty and are the first to sing the praises of that which makes sense to them. It’s going to be hard to peddle stuff to them in the same way as their ultra materialistic parents.”
This is the problem. Marketers are trying to use old mindsets to sell a generation with a very different mindset. This generation is not enamored with big homes, big cars, logos on their shoes or purses (unless they are knockoffs). This generation finds the materialistic values of previous generations foolish. And they are correct.
1. Communicate Value
Simply put, Millennials are strapped for cash and are especially price driven. They’ve adopted frugal shopping behaviors to keep their budgets in check. Millennials are deal-seekers and coupon-clippers and are more likely to give up their favorite brands to save.
2. Make an Emotional Connection
Purchase decisions don’t come down to price alone. Millennials seek products that promise fun and help them on their quest to live well for less, and they are particularly open to products that create a two-way avenue of communication.
3. Millennials as Brand Evangelists
Along the line of the two-way connection, Millennials make fantastic brand evangelists! When new mothers of past generations needed a diaper brand recommendation, they turned to a close girlfriend or even their own mother for advice. But today, with one Tweet or Facebook post, Millennial moms can survey their entire social network. Millennials really do take advantage of their infinitely broad reference pools. They not only search product websites, but personal blogs and online reviews, which exist in turn, because Millennials actively broadcast their opinions over new media.
“Mr. Fromm calls Millennials the savviest group of consumers ever.”
Riiiight. For years retailers have tried to crack the “women’s market,” “the gay market,” “the boomer market,” “the senior market,” etc., and now it’s the Millennials.
The desire of marketers to lump people into discrete groups in order to make their own jobs easier has never before worked because people are different from one another. It’s not going to work with Millennials either. Look for trends across segments and try to hit those.