In a recent article, Spencer Soper at Bloomberg contends that retailers should stop wasting so much time trying to win over millennials because they’re often broke. Instead, they should target older shoppers with more money to spend.
According to the report, for the past years, retailers have been obsessed with competing for the millennials’ business. “The truth”, he says, is that “millennials aren’t spending any money with anybody because they don’t have any.”
Not true. Millennials are buying. They are spending money on a whole host of products and services. Let’s take a look at what millennials are buying.
First, Millennials are the largest segment of first time home buyers. As a matter of fact, in 2019, 52% of first time home buyers were age 29-38.
Millennials are also the largest buyers of groceries, gas, restaurants, hobbies, electronics, cell phones, clothing. And, let’s not kid ourselves, they are the largest users of Uber, Lyft and other transportation services.
According to Forbes magazine, when shopping, Millennials focus on discounts. They value price over recommendations, the brand’s reputation, and even product quality. They follow brands online just for discount opportunities. 66% of millennials would switch brands if offered at least a 30% discount, and only a third see a brand to consider trends or product updates.
So, what does this mean to us as Direct Marketers?
Think Direct Mail
Since our focus is to target the best possible prospects for a given product or service and get our message right into their hands efficiently and cost-effectively I think we need to take a step back and look at what we’re doing.
Instead of trying to focus on millennials with cool new technology and an over-emphasis on social media, let’s work with the tried and true and target the age 45+ age group with integrated marketing approach, utilizing a combination of direct mail lists of millennials and online media – with strong creative, appropriate messaging and appealing offers.
Use the Right Offers
We know that millennials appreciate discounts. If you want to win over millennials, make sure you are offering a discount that entices them to open your mailer (or click on your message). Millennials can sniff out a lukewarm offer a mile away. You will waste all your efforts by offering a marginal discount.
Think Buy Now – Pay Later Programs
Buy now, pay later services are becoming more and more popular. Millennials, those aged 35 to 44 are very likely to have used a Buy Now / Pay Later (BNPL) service. Most people use BNPL services to avoid paying credit card interest or buy something not in their budget.
Marketing these within the offer, is an excellent motivator to get their attention. Millennials are big users of BNPL programs.
Millennials are the new financial powerhouse generation. Marketers need to learn what motivates their purchases and change up marketing to meet their expectations.