One size doesn’t fit all when it comes to millennials
Millennial consumers aged between 18 and 37 are the largest generation in US history
Millennial consumers make up one of the most exciting target groups for fashion and footwear brands and retailers - but new research suggests that one size doesn’t fit all when it comes to tapping in to their growing purchasing power.
Millennial consumers aged between 18 and 37 are the largest generation in US history, representing nearly 30% of the population. But instead of treating them as a single group with the same tastes and desires, marketers must move past simplistic generalisations and instead understand their unique qualities.
The latest research released by IRI categorises millennials into six distinct segments, and says they will spend nearly $290bn on CPG (consumer packaged goods) products – including apparel and footwear – by 2020.
"At 79 million strong, the millennial generation has a tremendous amount of spending power that is growing rapidly," says Robert Tomei, president of consumer & shopper marketing at IRI. "This is the largest generation of young people since the baby boomers."
Millennials "are much more than the sum of their stereotypes," the research suggests, and dispels five top myths:
- The "Me Me Me" Generation: This label doesn’t completely fit millennials: the reality is that 90% equate success with being a good friend, 68% equate success with working for a cause they believe in (compared to 56% for Generation X and 58% for baby boomers), and 58% equate success with being of service/contributing to their community.
- Avoiding the "Traditional" Path: Millennials are embracing "traditional" on their own terms and timeline. Overall, 73% are employed, 28% are married, 37% own a home and 38% have kids. While success follows many traditional paths, the key difference is that the timing of millennials’ life stage milestones isn’t as linear as previous generations.
- Tied to Mobile Devices 24/7: As the first generation of digital natives, millennials are comfortable with technology. However, not all are early adopters or constantly connected. For instance, 48% say they would be able to function without their smartphones, 45% say they’re early adopters of new technology and 29% regularly use a mobile app to pay for purchases.
- No Brand Loyalty: Millennials are loyal to brands that prove themselves worthy, but they also enjoy the hunt for a good deal. Overall, 44% say they are loyal to brands they buy, and 52% will choose quality over price. However, two-thirds are working with limited budgets, so a good number are value conscious by necessity.
- Traditional Marketing Doesn’t Work: Millennials are strongly influenced by recommendations through social media, blogs, product reviews or other online resources. On the flip side, 66% also respond to loyalty cards/discounts, 65% to couponing and 50% to store circulars—all traditional marketing tactics.
The six unique faces of millennials
The research uncovered that millennials fall into six distinct segments:
- Free Spirits: 13% of millennials are young, single, college-educated trendsetters who are impulsive and social.
- Struggling Wanderers: 21% are not highly educated, are struggling financially and are not strongly digitally connected.
- New Traditionalists: 22% are educated, affluent millennials who are married, are values-driven and have good financial habits.
- Concerned Aspirationalists: 13% are mothers who are both cash- and time-strapped. They are social media devotees and are convenience- and price-driven.
- Conscious Naturalists: 15% are eco-conscious mothers who desire minimally processed foods and prefer locally grown. They also are less digitally reliant and are fiscally cautious.
- Confident Connectors: 17% are ethnically diverse, socially conscious leaders who are digitally savvy and shop in specialty stores.
"Millennials are the most racially diverse, highly educated generation in history," adds Tomei. "Their path to purchase isn’t a straight line, so marketers need to keep this in mind and get creative. This means paying attention to their specific needs, ensuring they have the right product mix and customising their media and messages to be relevant to those needs."
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