If you have attended a retail of business conference over the last year, I suspect at least one speaker has addressed the need to get to know the Millennial shopper. I am one of those presenters that has been promoting the need to respond to a new consumer.
2017 is the year when the Millennial shopper starts spending more money in the retail environment that the Baby Boomer and we need to be develop our market now to grasp the opportunity and challenges this will present.
Millennial’s do think differently to Baby Boomers. One example is they start with the end solution in mind and as a result if a sales person wants to grasp a Millennial’s interest and engage them they must use a different technique to how they would engage a Baby Boomer. With Baby Boomers you need to proceed step by step and build the picture moving forward. Millennials’ want you to start with the solution and work backwards when providing the same advice.
Many retailers I speak to shrug their shoulders and say that the new generation will simply shop online or will walk in their store take a picture and compare prices to see if they can get a cheaper deal. In other words they do not have to change what they are doing, they also expect their turnover to decline. I do not agree that this has to be the case.
I agree that “Clicks” retailing will continue to grow and finding a better deal online will still be an option, but, consumers of all ages love shopping and they will continue to shop where they are enjoying the experience and are engaging with the a sales team and products on offer.
You cannot buy loyalty
Another myth is that loyalty is a thing of the past. Again, I am not convinced, I think it has changed. As a Baby Boomer myself I have grown up with loyalty schemes and loyalty cards and this has been a common technique used by retailers to gain my loyalty. I still have loyalty cards and use them on my travels and it still locks me in to specific businesses such as hotels, car rental companies and airlines.
Millennial’s are not generally looking for loyalty, they are looking for engagement and if a company engages with them they will tend to be more loyal to that company, yet research by Loyalty One indicates that 84% of Millennial’s would lock themselves into a retailer that supplied them with a loyalty points system.
They are not looking for the system where a card is stamped and they get a free coffee after the first 9 purchases, they need a different offer that links into an engagement process.
The indicators are that the new consumer will collect loyalty points if they can use those loyalty points to have a session with an expert.
When it comes to a grocer, they may use a grocer that provides loyalty points so they can have session with a food consultant who will provide advice on health, nutrition and cooking classes.
They could visit a garden centre that offered points that could be used to have lessons on how to grow vegetables or manage a balcony garden for a horticultural expert who will help them become more knowledgeable and aware.
A fashion store may, for example, develop a loyalty program that connect the consumer to a fashion consultant, whilst a pet shop may link into a vet or dog trainer.
It may also be possible for a group of retailers in the area who attract the same customer base to network a loyalty scheme between the.
An astute retailer could develop a loyalty club where the points could be redeemed on product or on lessons, this would appeal to both the Baby Boomer and the Millennial consumer.
Now is the time to rethink how you build a loyalty program, it may not be wise to throw the loyalty scheme away in the next few years, but it may be the time to reinvent it to appeal to a younger market.