Millennials are individuals who are born between 1980 and 2000. They are peculiar in many ways. First, they are the last generation of the 20th century. They are the first generation that can be rightly called a truly digital one.
They have been exposed to the inconveniences of the analog era and are eager to adopt digital technologies that can reward them with a better lifestyle, everyday conveniences, and choices like never before.
For Businesses that are keen on growth, millennials pose both a challenge and an opportunity. After all, they create $600 Billion worth of business in the United States alone (Accenture).
Compared to the previous generation of customers, millennials have unique behavioral traits. These traits make them a difficult market to enter and capture for businesses of all kinds.
Life hacks for millennials to simplify the workday.
So, what makes a millennial customer different from their predecessors? There are five major traits that make millennials different:
- Millennials are informed, buyers
- Millennial customer loyalty is fickle
- Millennials place impetus on experiences
- Millennials prefer to access, not ownership
- Millennials want sustainability
Millennials are informed, buyers
Armed with smartphones, mobile apps, and round-the-clock access to the internet, millennials have the facility to run deep research before they arrive at a buying decision. From review websites to online stores, and even social media hashtags, they mine every possible information about the business, brand, and the product that they are going to purchase.
In fact, a staggering 89% of millennials look to their network for recommendations. Also, a substantial 59% of them would also take to social media to recommend a purchase that they are pleased with. (Source)
In other words, millennials are far more concerned about parting with their money for purchases. They are informed buyers. They do not buy at the drop of a hat and need proper evidence to establish that their purchase is going to be worth it.
Millennial customer loyalty is fickle
According to PwC, the average millennial customer would switch loyalty if they feel that they are not treated right. PwC reports that, in the US alone, 59% will walk away after several bad experiences, (17% after just one bad experience). So fickle is the loyalty of millennial customers.
The massive proliferation of online shopping, an abundance of options, and also multiple choices have made millennials compulsive consumers of experiences. They seek every single facet of their purchase to be personalized — bespoke to their wants and needs.
Perhaps, this behavioral trait of millennials is also one reason that has led to mushrooming growth of loyalty programs; simply because loyalty programs and schemes give millennials a reason to stay loyal to a brand and even consider pardoning a negative customer experience.
Millennials place impetus on experiences
“78% of millennials would rather spend their money on experiences than any coveted goods”. There is a prime reason why they have adopted a contrary attitude compared to their previous generation.
To begin with, millennials earn less than their parental generation. Also, the price of major assets like housing and automobiles has also gone up considerably. Along with that the cost to own and maintain them has also increased to a level that puts a strain of the millennial income.
As a result, millennials are more focused on enjoying the present with unique experiences and activities that let them enjoy time affluence and make them work less for earnings. To quote Taylor Smith, CEO, and co-founder of Blueboard, “Millennials aren’t spending our money on cars, TVs, and watches. We’re renting scooters and touring Vietnam, rocking out at music festivals, or hiking Machu Picchu.”
The rise of on-demand taxi-hailing services, the dwarfing levels of property investments compared to rentals are indicators of this millennial preferences.
Millennials want sustainability
Millennials are well-informed that global warming and its subsequent climate changes are its highest point. They are also aware that the choices that they make in spending have a direct and indirect effect on reducing sustainability. As socially conscious customers, millennials are willing to pay extra to purchase sustainable products that cause less or no harm to the environment.
When it comes to choosing brands, millennials show a strong inclination towards brands that have eco-friendly products and offerings. They are keen on reducing their carbon by refusing single-use plastics, choosing reusable products, and reducing plastic consumption.
In fact, they are even willing to take conscious ‘lower-carbon-footprint’ holidays, unlike their previous generations that left larger carbon footprints. The availability of sustainability-certified choices is also aiding their cause. As a result, they have become habitual to expecting multiple sustainable choices from brands.
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If a business is a person, what does a millennial expect from it?
Considering the traits mentioned above, there are three major expectations that millennial customers have from businesses. This is irrespective of what they are planning to buy and when.
Right from the first interaction they have with the business and beyond the first transaction, millennials expect businesses to delight them with great experiences. It is the customer experience that makes a millennial stick to a brand. In fact, they are willing to pay at least a 16% price premium on products and services for a slightly superior experience (PwC: Future of Customer Experience). This remains consistent across every industry including hospitality, travel, tourism, entertainment, etc.
Here’s what businesses can do to target this need of millennials.
Remember that great customer experience stems from great customer support. A business must have all the necessary customer support tools like a business management tool like ProofHub to streamline processes, a helpdesk system, a virtual phone system for customer support, an active social media support system, etc. to deliver great customer support.
Millennials are not great fans of complicated processes. They rank convenience as a high priority when it comes to making a purchase decision. In fact, the massive growth of online shopping and decline of in-store purchases is due to the convenience factor. Convenience also takes other forms like minimal maintenance, on-demand access, scheduled delivery, personalized services, and the likes.
This has created new challenges and opportunities for traditional services like banking, insurance, financial services, healthcare, etc. Almost all these industries are undergoing a significant digital transformation that will enable them to connect with customers through web applications and mobile apps.
Amazon. Netflix. These are perhaps two solid examples of businesses that have built empires out of a millennial customer base. Unlike their previous generation, millennial customers have been raised in an environment where choices are abundant. Each choice gives the individual millennial customers to set them apart from a crowd an aura of exclusivity.
Also, numerous choices make millennial customers feel that they are in absolute control of what they intend to buy. The choices give them the opportunity to compare various models and brands before making the purchase. The choices are not restricted to products but also to payment options and deliveries.
Also read: A Key to Working With Millennials
What’s inside the millenial’s mind?
The millennial customer’s mind has been an unsolved puzzle for businesses and marketers. Unlocking it gives access to a trillion-dollar market that is only going to grow with time. However, millennials are not easily swayed by traditional marketing. They value experiences over possessions, choices over restrictions, and convenience over ownership. Again, this is just the tip of an iceberg. There is still more to the millennial customer that we can only understand with the passage of time.
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Inside The Minds of Millennials: What Do They Expect From Businesses was originally published in ProofHub Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.