Millennials vs Gen X : How can you adapt to their shopping habits?
You just have to do a search on Google Trends to understand the fascination of marketers for the Millennial generation. They are between 18 and 34 y.o. and you probably want to target them by all means. In the US, they are 80 million people (more than baby boomers and generation X, the 35-50 y.o.). They spend more online and will account for 30% of retail sales by 2020.
You get it, you’d better try to understand the shopping habits of this new generation. They are often described as digital natives who spend their time on their smartphones and only buy products online. Is this really the case? What makes Millennials different from their predecessors, the Gen X?
We have investigated by focusing our research on the 4 main stages of the purchasing process : Product discovery → Purchase motivations → Purchase → Loyalty
Product discovery : Millennials vs. Gen X
Millennials discover products on their smartphones, a lot on social networks
Millennials love to discover products on their smartphones. 79% of them say that they have discovered new brands, products or services on their smartphones. It’s not very surprising when you consider that Millennials check their smartphones approximately 150 times a day.
Social networking accounts for one in every five minutes spent by the 18-34, mostly on their smartphones. It is mainly on Facebook, Instagram and now Snapchat that Millennials find their inspirations. No wonder that brands targeting Millennials are investing heavily on these platforms.
Like Millennials, Gen X is addicted to smartphones but it favors emails and online search to discover new products
If you think that people of the Gen X love the desktop and spend most of their time on that device, well you are wrong. In the US, the 35-54 spend 63% of their digital time on mobile (smarphones + tablets), not far from the 18-34 (69%).
The Gen X likes to ROPO (Research Online, Purchase Offline). They spend a lot of time on the web to learn about the products they love, before going into store.
Unlike Millennials, the best way to reach the 35-54 remains emails. Gen X shoppers have always loved this communication channel, their Facebook at that time. Plus it’s easier to measure your ROI with emails than social networks for example.
Purchase motivations : Millennials vs Gen X
Millennials love affordable and ethical products that resonate within their community
Millennials are sensitive to brands that “give back to the community”. They like the idea that their purchases can have meaning. Brands like TOMS in the US (for every pair of shoes you buy, they give another pair to a child in need) or Faguo in France (for every product you buy, they plant a tree in France) have taken advantage of their ethical positioning to build a strong and loyal customer base among the 18-34.
The community also plays a key role among Millennials’ purchase motivations. 84% of them explain that user generated content had an influence on the products they purchased. This is also a generation that is very likely to buy on the impulse.
Despite the importance they give to product quality, Millennials are very price sensitive. Whole Foods gets that and will launch in May 2016 the 365 Stores, stores specially dedicated to Millennials where they will be offered organic products at an affordable price. In these stores, they will also find unusual services and products (tattoo shops, coffee shops, bike sellers…).
Gen X shoppers are more down to earth and more immune to fashion trends
Gen X shoppers are more down to earth. They are looking for high quality products but at the right price. Their thinking is “it’s okay if it’s expensive as long as the quality is worth it”. Watch the success of brands like Made (no intermediaries, affordable quality products) or more recently Loom (“clothes that last and don’t cost a fortune”), a fashion brand launched by Merci Alfred, a very popular French media website.
Gen X shoppers are less influenced by fashion trends than their little brothers. They have experienced the transition from a rising economy to a sluggish one and are more skeptical about the sincerity of brands’ messages. You have to be transparent and consistent to convince them to buy your products. They tend to prefer niche products capable of expressing their personality and avoiding the “one size fits all”.
Purchase : Millennials vs Gen X
Millennials are buying more and more on mobile but it doesn’t mean they have stopped shopping in stores, on the contrary…
Millennials can’t stop staring at their smartphones. No wonder that they discover and buy more and more products on this device. A study made by IAB in October 2015 in the US showed that Millennials are more likely to buy on their smartphones than the rest of the population (43% versus 28%).
It is then very important for retailers to offer purchase experience perfectly designed for mobile. Indeed, if you can easily reach Millennials on their mobile phones through social networks, you need to streamline your mobile checkout to convert them (page load time, form simplicity…).
These new mobile purchasing paths must however be part of an omnichannel strategy. 68% of Millennials say they want a seamless shopping experience, across all channels. Starbucks is a great example of a successful omnichannel strategy. They developed a mobile app that allows their users to purchase with their smartphones or to order their coffee ahead and pick up in store without having to queue.
Gen X shoppers buy more and more online and also favor seamless omnichannel purchase experiences
Gen X shoppers took the habit of buying online with 52% of the 35-50 who reported having already made a purchase online. They have also adopted new omnichannel habits, like click and collect or reserve to store.
The only difference with their younger brothers, is the speed of adoption of new shopping habits. For instance, 92% of Millennials say they love showrooming (the fact of searching products on mobile while visiting a store) against 80% of the members of Gen X.
Gen X shoppers are also less impulse buyers than Millennials and love to take the time of benchmarking products. It is therefore important to give them enough information about your products.
Loyalty : Millennials vs Gen X
Good news, Millennials are very loyal as long as you take good care of them…
You fear that Millennials will not be loyal to your brand ? Yet, Millennials can be extremely loyal provided that the brand experience address them well. They are 64% to be as or more loyal to brands than their parents.
Gen Y shoppers want to be pampered by the brands they are loyal to. This requires a dedicated communication that tells a story and reflects a real brand identity. Brands like Madewell or the French success story Sézane know perfectly how to speak to their communities.
Millennials are also fond of loyalty programs. They look for personalized promotions that are easy to use (for instance with their smartphones when they buy in stores). Sephora knows this. In addition to providing a fun store experience tailored to Millennials, Sephora personalized promotions based on customer’s profile. Sephora has gone even further by creating the VIB program, a program specifically designed for mobile and that enables its members to benefit from exclusive rewards (private shopping sessions, studio passes…).
Gen X shoppers, loyal, demanding and “straight to the point”
Gen X shoppers are also loyal with 40% of them standing by the brands they love. Unlike the Millennials, members of the Gen X don’t need that brands tell them a story. What matters most to them is an outstanding customer service. Honest and transparent brand communication is a great way to win the heart of this generation.
Just like the Millennials, Gen X shoppers love loyalty programs but mainly to save money. They don’t want to engage with brands. To make them loyal, adopt an easy-to-use loyalty program, where they can quickly see how much money they are saving.
What if they were not so different?
It’s not always easy to tell the real difference between Gen X shoppers and Millennials. Indeed, the 35-50 have quickly adopted new technologies. As for Millennials, mobile first doesn’t mean the end of the store visit, quite the contrary actually. Millennials want a seamless omnichannel purchasing experience where the brick & mortar perfectly fits with the new mobile habits.