By Rieva Lesonsky
Millennial consumers bring their own share of challenges to small business owners hoping to effectively market to this age group. A SymphonyIRI report released in June and reported by MediaPost has some insights into what Millennials need, what they want and how to target them as customers. The report, which defined Millennials as between the ages of 18 and 34, portrays them as a huge generation that will have a massive impact on purchasing.
For now, however, Millennials are struggling on modest incomes in a tough economy. For instance, 32 percent report they have trouble affording weekly groceries, compared to 22 percent of consumers overall. Not surprisingly, their spending habits are fairly conservative; for instance, in the past 18 months, they reported less financial confidence than average shoppers. They are more likely than the average consumer to be cutting back on expenses by dining out less often, limiting hair salon or spa visits, and cooking at home from scratch. And a whopping 86 percent said low prices were the first or second factor influencing where they shop.
But price isn’t the only factor Millennials care about. Millennials prefer retailers that are fun to shop at, and also want products that are relevant to their needs. Unique among generations, they are the first generation that’s “always connected.” The report cites University of Michigan research that 80 to 90 percent of Millennials use social media, three out of four have a profile on a social networking site, and 80 percent sleep with a cell phone next to them.
Clearly, digital media influence Millennials far more than they do the average shopper. Millennials in the study are more than three times as likely to be influenced by smartphone apps, recommendations or information from social media, or mobile advertising than the average consumer. They also rely heavily on peers when making purchasing decisions—and peers include not just friends and family, but anyone in their age range or life stage.
As you might expect given their modest incomes, Millennials are more swayed than the average shopper by low prices, coupons and loyalty card discounts. Surprisingly for this digital group, old-fashioned marketing methods such as in-store signage, product packaging and newspaper ads also carry more weight with them than they do with the average shopper. What mattered least was previous use of a product. That’s both good news and bad news for small business owners, meaning that while it’s easier to capture new Millennial customers if you show them a good value proposition, it’s also easier to lose your existing customers if they see something better come along.
SymphonyIRI suggests these tips for targeting Millenials:
- Monitor trends among Millennial so you can anticipate and proactively address changes in their shopping needs and wants.
- Connect with Millennials on an emotional level by offering innovative products, packaging and marketing that help them achieve their goal of “living well for less.”
- Use both new media and traditional marketing methods to reach Millennials at all phases of their lives.
Image by Flickr user J. Cortazar (Creative Commons)