Millennial's

The Millennial generation is very different to their parents.

And whilst you might think this is an obvious statement, There’s one key fundamental difference…

Spending habits.

Millennials are far less likely to buy something out of convenience which is the core of many retail company’s business models.

Millennials consider every purchase, wait for that bargain or the end of sales.

Could it be nicknamed the “Groupon Generation”!?

You could say this generation is super cautious with wealth preservation.

But here’s the interesting thing. In the respect of being more cautious with retail and impulse buys this doesn’t transfer into any kind of financial planning.

Millennials don’t use financial advisers or mess about with things like pensions, it’s a live now culture! I’ve heard this lack of planning referred to as the ideas of

“Living an accidental life”

Not planning for the long term on the basis that “It will be ok somehow” It’s fascinating.

The under-35 generation may be digital natives today, but this generation’s interest in technology (and the older generation’s initial distrust) is timeless.

UBS recently published an in-depth study of millennials and their habits and behavioral patterns. So why are all of the big banks so keen to study this enigmatic generation as if they were from another planet?

It’s simple, millennials do not engage, for the most part, However, and hence all the research and fuss, Millennials are about to benefit from one of the largest intergenerational wealth transfers in history and the banks and fund managers are paying serious attention. In just three years global millennial wealth could stand at $24 Trillion, according to UBS, up $7 trillion from 2015. It’s a snowball of wealth, literally.

“The largest intergenerational wealth transfers in history”

Some key points:

UBS observed that millennials have particular traits that differ from other generations. They particularly favour convenience, multi-channel communication, and transparency from businesses (and wealth managers).

In contrast to other generations, millennials prefer to engage with companies and purchase their products using a variety of channels. They value digital communication and social media as a means to be inspired, compare prices, and select goods and services. In 2014, 47% of millennial consumers used social media as part of their shopping experience versus 19% of non-millennials, according to Deloitte Digital (Navigating the New Digital Divide, 2015). Yet they combine this digital interaction with in-store collection more frequently than other age cohorts — 19% of millennials bought their shopping basket online and then collected the goods or services in store, versus 12% of non-millennials according to the same survey.

Millennials show a higher propensity than other generations to be transparent and share personal information if doing so gives them an advantage such as a financial or experiential incentive, or if service is thereby more personal. On this point, 23% of millennials would be willing to share their cell phone number, 21% their purchase history, and 15% their household income (compared to 11%, 12%, and 6% respectively for Baby Boomers), based on data from an October 2015 study conducted by the University of Columbia Business School and Aimia (What is the Future of Data Sharing? Consumer Mindsets and the Power of Brands).

“Millennials are obsessed with technology”

The assumptions that Millennials are obsessed with technology and themselves, to their own detriment, do not conform to the facts. All age groups rely increasingly on technology and are aware of the world’s economic and social imbalances.

Millennials and non-millennials alike are being increasingly drawn toward platform-companies, with technology powering an open, information sharing infrastructure to match financial and human capital with user needs. The convenience, connectivity, and pull of platform companies, where relevant communities are a key value proposition, will encourage firms to refine their business models and provide valuable content that is customized toward clients’ particular affinities.

Individuals will increasingly demand innovative means by which they can tackle problems of social inequality, as technology and extreme connectivity throw light on issues across the globe to more people. Corporations, governments, and non-governmental organizations will progressively drive innovation and develop solutions that meet this demand and marshal capital (both financial and human) into the most purposeful projects.

The millennial generation is fast becoming a major force in the world economy. Their varied tastes and evolving demands are influencing other generations too. The potential implications are big for everyone.

So how well do you know the millennials?