Generation Y, Showing the Way for Retailers in the Digital Age

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Generation Y or Millenniums, comprises of individuals that were born between 1980 and 1994, and make up about 25% of the world’s population. Gen Y is therefore an important cohort for retailers to target because of its size and purchasing power. Retailers, as with the other generational cohorts (Baby Boomers, Generation X and Generation Z), need to know what the shopping behaviors of the Gen Yers are. But first we need to know who Generation Y is?

Who is Generation Y?

Generation Y individuals came of age during a period of economic growth, a strong emergence of social media and reality television, and the disappearance of modernist values, supported by internationalization and strong influences from popular culture 1. They are perceived as more focused on living large and carefree compared to more serious previous generations.

Some describes the Millenniums as most diverse; underemployed; lazy; entitled; self-centered spoiled brats. However, most of them feel frustration, fear, doubt and even anxiety taking their first steps “in the real world”. Since they are most of the time connected to the internet, Generation Y hears the ‘bad’ news about inflation, unemployment; changes in public policies in real time. Digital communication technology is part of Gen Y’s existence.

The Millenniums have grown up with technology and it has captured their lives. Hussein 2 (2016) stated that 87% of Generation Y always had their smartphones at their side, day and night. Further, he said, 78% of them spend over 2 hours a day using their smartphones, and 68% considers their smartphone to be a personal device.

“Gen Yers are multi-taskers who use their mobile phones for just about anything: social networking, to find a job, and to get grassroots-generated information about products, services, schools, employers and travel destinations” suggests Parment 1 (2013).

Also, Generation Y actively contributes, shares, searches for and consumes content – plus works and plays – on social media platforms 3.  The table below, published by the American Press Institute, indicates how and when Gen Yers use different social media network sites.

How Millennials use different social media network sites

Fifty seven percent of Millenniums indicated that they use Facebook daily, while 54% used YouTube occasionally. How can retailers engage with this tech savvy and connected cohort?

Used dailyUsed occasionally
Facebook5731
YouTube2954
Instagram2623
Twitter1321
Pinterest1025
Reddit815
Tumblr714

The shopping behaviour of Generation Y

Retailers that understand the shopping behaviour of their customers may enjoy an advantage over their competitors. Generation Y are generally not loyal customers. Therefore retailers should provide them superior customer value or any other advantage, such as a lower price 1. Gen Yers are very flexible in terms of buying expensive and cheap products – to define themselves.

Gen Y buyers select and consume products that helps to define them. The products must show what is important to them and what they value in life. They will choose products that express some aspect of their own personality or image. Hence the Millenniums visit numerous shops regularly, in effort to stay in tune with what is ‘in’ at the moment. As a result they often visit clothing stores without having a pronounced need.

The Millennials – the largest generation in US history – are entering their peak spending years. Lindsay Drucker Mann, a vice president in Global Investment Research at Goldman Sachs, explains how companies are responding to their growing economic influence:


However, the Y Generation is  the cohort that does most of their shopping online.

Online shopping behavior of Generation Y

The association that Gen Y has with digital communication technology makes the internet an obvious channel for retailers to interact with them. However, cautions Parment 1 (2013), Generation Y wants to decide when, where and how companies communicate with them. They take the opinion of others into account when making a buying decision.

Retailers should note that Generation Y freely discusses various issues with their friends on social media platforms like Facebook. Gen Y considers friends to be credible sources that have a big influence of how this cohort evaluates products and brands4.

Jaz Frederick, writing in PFSWeb.com highlighted some trends among Millennials and online shopping:

  • the average consumer aged 18 to 34 invests $2,000 per year on digital retail sites;
  • millennials show the highest growth (32%) in mobile sales;
  • smartphones are the most-used shopping device for the Y Generation.

Retailers need to be found online and make sure that Millennials have great experience when visiting their pages.

Concluding

The Generation Y is a complex cohort. Nevertheless, they are the generation who must lead humanity into the digital age. The Millennials will dictate to retailers what technology to use and what content they want. Ultimately, Gen Y is paving the way for all of us to face the realities of the digital age. Please have patience with them…

A Marketing Plan helps you to communicate the right content to the right audience.

Read also:

  1. Selling to the Young Ones, Generation Z
  2. Know Your Clever, Less Distinctive Customers – Generation X
  3. Shopping Behavior of The Baby Boomers
  4. Demographic Segmentation – Dividing the Market by Generations

Notes:

1 Parment, A. 2013. Generation Y vs. Baby Boomers: Shopping behavior, buyer involvement and implications for retailing. Journal of retailing and consumer services, 20(2):189-199.

2 Hussein, Z. 2016. Assessing the purchase intention of Malaysian Generation Y in mobile shopping. IJASOS-International E-journal of Advances in Social Sciences, 2(5):424-431.

3 Bolton, R.N., Parasuraman, A., Hoefnagels, A., Migchels, N., Kabadayi, S., Gruber, T., Komarova Loureiro, Y. and Solnet, D. 2013. Understanding Generation Y and their use of social media: a review and research agenda. Journal of Service Management, 24(3):245-267.

4 Viswanathan, V. and Jain, V. 2013. A dual-system approach to understanding “generation Y” decision making. Journal of consumer marketing, 30(6):484-492.

Image:

Pixabay.com

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