It should be no surprise that Millennials and baby boomers are two key demographics with opposing shopping habits. But the two diverse groups are also shaping global retail trends. Millennials are helping to drive the need for richer digital and personalised experiences and baby boomers have the spending power that their younger counterparts lack. Retailers are challenged to address two very different segments of the population as they aim to respond to progressive trends, embrace technology and ultimately advance their businesses.
A recent study conducted by Oracle Retail called The Power & The Money surveyed 13,250 consumers across 12 countries including Australia; Brazil; China; France; Germany; Italy; India; Japan; Mexico; Russia; UK and U.S.
The research uncovered that retailers are poised to meet the varying needs of its consumers – not with different approaches for different audiences but by being brands that can give every individual the experience they are looking for. To understand how to address the differing needs of both sets of consumers it’s important to know their respective shopping habits. The research found that 40.7 per cent of Millennials shop online at least once per week, while only 16.4 per cent of baby boomers shop online at least once per week. Millennials are also more apt to research items online and then buy the items at the actual storefront (42 per cent), or buy something online and have it delivered to a retail store near them (24 per cent) – a practice also known as click and collect.
Older shoppers (74 per cent of baby boomers) still prefer to shop in-store compared to Millennials (59 per cent) and 20 per cent think it is far more important to be able to see and touch products before they buy compared to their younger counterparts (just 8.7 per cent). Notably, baby boomers are more likely to abandon an in-store purchase because of poor customer service. Nearly a quarter have walked out because staff couldn’t answer their questions. It’s clear this group would benefit most from empowered associates with more information at their fingertips.
Technology is key
Technology plays a significant role in the way Millennials and baby boomers shop and mobile technology in particular highlights a big discrepancy. Only 4.8 per cent of those boomers make purchases using an app, or mobile website on their mobile devices vs. 36.8 per cent among Millennials. It’s not surprising there is such a mobile divide given baby boomers did not grow up with a device in hand, however retailers can’t assume the store is for older shoppers and online and mobile are for younger shoppers. In fact, these trends may hold the key to getting more Millennials in-store but conversely may help steer more baby boomers online.
Nearly 32 per cent of baby boomers say that they would shop online in order to check real-time inventory in physical storefronts. And, 60.4 per cent said their overall shopping experience would improve if retailers provide more promotions and offers that are more relevant to them. This indicates that personalisation, whether in store or online, can play an even more important role in the future of the overall retail shopping experience.
Mobile is everywhere. Getting baby boomers to shop using their mobile devices may be a more difficult issue to solve, but for Millennials shopping online and shopping on an app or mobile device is second nature. Many (36 per cent of Millennials) want even better mobile services. They also prefer more payment options to conduct their mobile shopping, such as PayPal or Apple Pay (48 per cent). Surprisingly baby boomers (33 per cent) also want payment choices though they are less active with app and online purchases than their younger counterparts.
Despite some of the vast differences in shopping habits and preferences there is some common ground among younger and older consumers.
The research shows consumers are increasingly concerned about issues such as authenticity, transparency and responsible sourcing. They want to know what their products are made of and where and how they are made. These findings highlight the clear need for retailers to ensure more information is available about their products and their supply chains. This information can and should exist in the same place and be easily searchable. Retailers need to ensure they have that information and can structure it in a way that can be served up to consumers on multiple devices, in-store, online and on mobile.
They each note convenience as another key factor when shopping (eight per cent Millennials to 11 per cent baby boomers) indicating that a quick, painless and simple shopping experience still reigns. Those surveyed also cite value and quality assurance as important aspects when making a purchase. Millennials tend to follow the bargains online more so than baby boomers and they also see quality assurance as more important -- likely because they have less expendable income and need to be more conscientious with how they spend their dollars.
Millennials and baby boomers also have a similar opinion when it comes to brand loyalty. Both segments have left a store without making a purchase due to a lack of choice or availability of products (38 per cent Millennials, 42 per cent baby boomers), and if items are out of stock they have no qualms about going to a competitor, rather than waiting for the item to become available (35 per cent Millennials, 37 per cent baby boomers). In the future consumers would welcome technology that lets them check live availability of items as they enter a store (30 per cent Millennials, 27 per cent baby boomers), or the ability to use location-based services to find items in large stores. This suggests innovations which are subtle and practical will improve engagement especially with baby boomers.
These innovations will also prove a ‘springboard’ to further innovations. Once consumers are using their mobile phone to assist with one aspect of the retail experience, it will be easier to provide further mobile and online services.
Across Europe, most consumers think that retailers should be adapting technology to improve their shopping experience by having more promotions and offers that are more relevant to them (51 per cent Millennials, 60 per cent baby boomers). Millennials (28 per cent) want more personalisation, such as receiving targeted deals based on past purchases whereas 29 per cent of baby boomers want to be left alone in between purchases.
But few things divide the Millennials and baby boomers more than innovation. The research reveals older demographics are less immediately excited by technology and innovation. Over a third (37.5 per cent) of over-60s dismissed in total a wide range of potential innovations, saying they have no interest in them at all, compared to just 8.3 per cent of the Millennials. When presented with instances where innovation could provide an immediate benefit to their retail experience – such as getting better answers from shop staff armed with smart devices – baby boomers were keener to consider them.
While not all consumers are ready for technology such as drones making deliveries, 42 per cent of Millennials and 34 per cent of baby boomers do want to see new and improved, more convenient, delivery options. Retailers should consider integrating more third-party courier and delivery services, or on-demand taxi applications such as Uber into their delivery options. This would give consumers more choice, more control and more transparency.
Generally, consumers indicated they would be most excited to use new technologies such as scanners that scan a trolley full of goods in one go, wearable technology that automatically detects, scans and pays for items, and virtual reality technology that enables you to see how items would look in your house underscoring a seamless shopping experience.
There’s no question that the shopping experience for Millennials and baby boomers will evolve – it’s just a matter of what that evolution will look like and how the retailers respond.
Image source: Shutterstock/View Apart
Jeff Warren, Vice President: Retail Strategy & Solutions Management, Oracle