What customers can prove the hardest to convince? Millennials!
What category of customers will come to dominate the market in few years? Millennials!
The change in the consumer market will be momentous. For most companies, it will spell out disaster. For a select few, it will mean a new period of prosperity.
Understanding the new type of customer that they are going to face is essential for the success of companies all over the world. Tech-savvy, largely immune to the typical promises of the sales industry and appreciative of simplicity and efficiency, millennials are something new in the consumer market.
In fact, labeling them as “consumers” would not go well with this crowd.
Addressing them with success in the upcoming years is however at the core of commercial survival and success for companies and brands.
1. Millennials are a tough nut to crack
The marketing industry has a history of constant evolution. From billboard to SEO, it has always managed to establish a connection with the average people, the customers, and to exploit that connection. The marketers’ thorough understanding of how a customer thinks is their bread and butter.
Millennials, however, are an entirely different kettle of fish.
A Gallup study shows that as customers, only 1 in 4 millennials are emotionally and psychologically attached to a brand, product or company. They lag behind all other generations in this respect.
The same study shows that millennials are currently spending an average of $85 per day and account for 28% of the daily consumer spending in the U.S. Surprisingly, when it comes to comes to spending, this generation’s economic behavior is more conservative than that of Gen Xers, coming closer to that of Baby Boomers.
The same Gallup study estimates that the $13 that separate the spending levels of millennials and Gen Xers in the same period costs the U.S. economy at least $949 million each day.
At the same time, members of the youngest generation are much more likely to spend greater sums on impulse.
How do you address a customer that is usually conservative with his money but who is also likely to spend a week’s salary for fun?
Every new generation has its preferred method of communication, the one to which they are most likely to respond.
While older generations were greatly impressed by signs, posters and TV commercials, millennials hardly notice them. Instead, they respond to stimuli coming from other directions.
One of the biggest stereotype regarding the newest generation is that they spend their entire day on social media and that they hold likes, shares are re-tweets in the highest regard.
One would expect them to prefer social media for communicating anything.
However, a recent survey uncovered that just over half of millennials prefer communicating with a company via email, followed by phone and text message. Social media messaging came in 4th with only 4% of respondents preferring it.
What does this say about the way in which millennials think?
Evidently, there is a psychological separation of methods. If they exchange social media messages among each other with ease, millennials do not consider it an appropriate medium for communicating “serious” topics such as jobs or products.
Another important issue is the downfall of the phone. More sophisticated than ever, phones nowadays have lost their initial purpose – that of making calls.
Millennials, for one, dread talking on the phone and prefer text messages. A different Gallup poll showed that 68% of Americans aged 18 to 29 send or read text messages “a lot”.
This refusal of speech is inherent in the new generation. But why do millennials prefer written words? For one, they grew up during the exact period in which instantaneous messaging was surging.
Most of all, typing out your thoughts allows you to put them in order and give them shape before facing another person. This is perhaps the single greatest reason why millennials prefer texting.
As an added bonus, texts and emails can be opened and re-read as many times as you wish, as opposed to a stressful and singular phone call.
3. How to Improve Customer Service
What can companies and marketers learn from the erratic economic behavior of millennials and their psychological separation of communication channels?
Before devising a marketing strategy to address millennials, you should also take into account the fact that the youngest generation is used to being vocal. Millennials are used to self-expression. A one-way channel between them and companies would not only be unpopular, but would be openly opposed. As an example, millennials despise TV.
Moreover, as they are used to constant ads clogging their visual space, they will not respond in any way to marketing done in the old-fashioned, repetition-based way.
What companies need to understand in order to successfully pitch their products and their brand image to millennials is the way in which they use each communication channel.
When it comes to social media, the promotional pictures and videos that you could find on the street or in a TV commercial do not impress. Instead, customer-centered campaigns that allow feedback, as well as contests or any other form of communication that requires active participation from their part, are all appealing to millennials.
For them, engaging with brands is a social experience. Millennials eat, shop and have fun in groups. As a result, they also more likely to make decisions as a group.
This feature of the new generation lays behind the recent importance that reviews have acquired for online retailers. This is true for the online as well as the offline environment.
Millennials are more likely to follow the recommendations of their friends as well as those of disinterested strangers, rather than believe the seller. Playing on this social side can bring immense benefits to companies.
Any technology that is meant to address the needs of millennial customers has to be simple, intuitive and functional. Used to an array of sparkling products that do not actually function, millennials value simplicity and effective usage.
What takeaways can companies get from studying millennials?
First of all, while promotion should be done on social media – in an engaging way –, customer support and service should be done through the more “official” channels, primarily email. Instead of calling, company representatives should text.
Millennials also care about who they buy from. A company looking to address millennial customers in particular should therefore look to establish its values clearly.
If the customer is king, the millennials will soon experience their coronation.
While their accession foretells rivers of honey for cool start-ups and other types of companies, it promises that scorched earth will await those who do not understand them.
Abigail Owens is an e-commerce consultant. She advises entrepreneurs and small business owns in matters of social media, branding and UX/UI. One of her latest projects is called TemplatesInfo, a collection of free printable templates, focused on increasing productivity and keeping organized.