Are Millennials The Key to Growing Retail Sales And Re-energizing Our Brands?

Yes, but not in the way that most people think.

Over the last several years, significant financial and human resources have been invested on cracking the millennial code. And with good reason, by 2016, Millennials will represent more buying power than any other generation (and in some industries, they are already there). Retailers and brands are banking on the growth of their “fair share” of the Millennial business to the point where several have added positions dedicated to marketing, brand and product development specifically to this target group. Is this the answer?

With so much attention paid to this group, the “discoveries” have been pretty wide spread. We’ve seen them. . ."a generation of apathy", "ready to take on the world", "know it alls”, “expect too much too soon". . .yet these same descriptions were used to describe Gen X, Baby Boomers and even the Silent Generation when they were coming of age. The fact is that Millennials are about as diverse as any generational group, perhaps even more so given the social and global trends in place today. As the Millennial code is cracked, what we see is many little pieces and not just a cohesive group that can be easily marketed to.

What is true about Millennials - they are more globally linked and more technologically savvy than previous generations. They focus more on purpose and seek to incorporate that into their everyday lives. They are embracing the “sharing economy” and look at their careers more as a series of projects, less a series of positions. But this has less to do with the Millennials as a generation and more to do with the world as it stands today and the current economic realities. Millennials are simply more prepared for this new reality because the trends are “native” to them - they grew up with these trends and are able to adapt to them more quickly than the rest of us. However all generations are facing these economic trends and those of us who are “immigrants” - meaning these trends feel more foreign to us - will take more time adapting to them. Because of this, Millennials are the key to growing retail sales and brands NOT simply because they are growing in economic importance but because they are the advance scout to what we are all facing and how all generations will eventually adapt to this shifting world.

Some key trends to observe.

BRANDS NAME IS DIMINISHING IN IMPORTANCE WHILE MORE PREFERENCE IS GIVEN TO QUALITY PRODUCT THAT OFFERS STRONG VALUE. This trend doesn’t mean that brands aren’t important, it just means you can’t disguise bad product and service with a known brand name. The new power brands will be built on the foundation of great product, great service and and a “kick ass” experience. This provides opportunity for new brands, or brands seeking to re-establish themselves or reach a new customer.

CONSUMERS SEEK RELATIONSHIPS WITH PEOPLE, NOT BRANDS, AND ACCEPT ADVICE FROM PEERS RATHER THAN “EXPERTS.” Should brands be on social? Absolutely, yes, and its hard to believe that companies are still asking that question. But consumers don’t want to engage with the brand, they want to engage with the people behind the brand. They want to read reviews from other customers. This means getting your associates and customers involved in a real, authentic way. Which means risk, and that your brand needs to be on solid footing, but the potential reward is out there.

PURCHASES WILL ME MADE LESS ON WHIM (READ: CHEAP PRICE) AND MORE ON NEED, VALUE AND PURPOSE. Consumers are asking the questions “do I need this, does it serve a value, does it have a purpose” more frequently and are less likely to succumb to the discounts on products that they simply don’t need or want. Product built simply for margin purposes and sales that attempt to encourage multiple purchases are slipping - while many luxury brands are rebounding and consumers are not afraid to pay more when the purchase is warranted.

IT WILL BECOME MORE COMMON FOR PEOPLE TO HAVE MULTIPLE SOURCES OF INCOME AND COMBINE THEIR PURPOSE AND PASSIONS WITH THE WORK THAT THEY DO. Understanding that careers are no longer built on one job, or “nine to five” should help brands to understand why they need to be available when and where the consumer wants to interact. And this new consumer isn’t separating their “business” from their “personal” lives - they are living with purpose and expect those that they interact with to do the same.

HOW COMPANIES BEHAVE, HOW PRODUCT IS SOURCED, HOW PEOPLE ARE TREATED WILL CONTINUE TO INCREASE IN IMPORTANCE. It isn’t just about worrying if “Sixty Minutes” is going to catch something - the internet has created millions of journalists who review and report on everything. How you act as a brand can impact your advocacy positively or negatively much more than at any time in the past. For those following the Market Basket situation, you can see how the actions of a company and its board can impact both associates and customers and cause both to either support or walk away from your brand:
https://www.bostonglobe.com/opinion/editorials/2014/08/06/market-basket-only-solution-bring-back-arthur-demoulas/fT2g89pXs8eOGsCI9zioLK/story.html

PRODUCT IS KEY, BUT THE EXPERIENCE CAN BE THE DIFFERENCE MAKER. Brands need to start with better product. As prices begin to climb, the consumer is becoming more selective with where they are going to spend there money. But while it starts with product, those brands currently winning the space are creating experiences - either direction or indirectly - that appeal to the brand’s consumers in an authentic way. Whether it is creating a richer on line experience, creating a physical space that inspires the senses, or engaging with consumers outside of commerce (music, sports, etc) - the formula is no longer “buy low, sell high.”

Yes, Millennials represent a new consumer, one not tied to long term brand relationships and one poised to take the economic mantle within the coming months and years. However this is simply not about the Millennials, they are merely the advance scout, the most adaptable to economic shifts and consumer behavior trends that are impacting us all. Five different generations are now working and living side by side and understanding how Millennials adapt can lead brands to make changes that can attract us all. And win.