As Millennials have come of age in recent years, there is a greater sense of urgency among merchants and other industry players to better understand their consumer habits. Are they big spenders? Do they save? Do they just want experiences and not material objects?
A recent white paper put out by Synchrony Financial attempts to answer some of these questions and help us to gain more insights into how Millennials spend their money.
In order to better understand this new generation, the white paper draws comparisons between Millennials and the Baby Boomer generation, the latter still having the most disposable income. Boomers are responsible for almost 50% of retail sales compared to about 10% for Millennials
According to their research, it turns out that Boomers and Millennials share many digital shopping habits. Both Boomers and Millennials are comfortable with online shopping, browsing and researching. 55% of Millennials and 68% of Boomers have visited a mobile retail site on a tablet, while 90% of Millennials and 86% of Boomers research products online. Millennials are only somewhat more likely to own digital devices. 66% of Millennials and 54% of Boomers own a smartphone, while 46% of Millennials and 31% of Boomers own a tablet.
There are differences as well. The most significant for the payments industry is that Millennials are much more likely to use their mobile phones for a wider variety of shopping-related tasks, such as research, coupon usage and using mobile retail sites. Boomers have the devices, but are not as likely to use them for shopping.
The core insight about Millennials is that even if they as a generation don’t have the money right now, they are the future of retail sales. According to Synchrony, this means that “retailers who do not fully understand and engage the millennial customer may eventually find their strategies out of touch with their future core shoppers.”
For the payments industry, this insight highlights the importance of a providing a seamless omnichannel payment experience. Providing a seamless, effortless consumer interaction experience is increasingly becoming a necessity, especially if merchants want to increase sales with Millennials.
As our own Yana Persky wrote in the recent Rich Merchant Services 3.0 Brief:
Payment service providers can play a very important role in providing the omnichannel payment solution that would drive transactions from all channels through a single payment processing platform. Unfortunately, a single payment processing platform still remains a buzzword rather than a reality and to change it merchants need to make significant technology investments.
If you haven’t done so yet, be sure to read the whole brief. It’s full of great stats and insights on the latest industry trends.