Mark Bunney of Ingenico Group, provides insight into how Millennials will define the future of customer loyalty.
Gen Z has dominated headlines lately as brands work through how to market to these emerging buyers. But why are we focused so heavily on these new consumers when we’ve barely started feeling comfortable with millennials? Looking ahead is important, but in the case of Gen Z, brands are just chasing the shiny new object. Millennials now have the buying power to cause seismic sales shifts for brands and, most importantly, have changed how we’ll understand loyalty forever.
Millennials can indeed be loyal, but their version of loyalty is a unique one. A generation ago, loyalty meant deals and discounts. Millennials are fickle, but loyal to brands that can offer them an engaging experience and meet their needs at any moment, anywhere. What’s more, millennials and Gen Z are renowned for being incredibly tech-savvy, as they’re the first age groups to grow up with smartphones as their personal computers and are open to using technology to get the experience they want. For merchants, this means rethinking everything from the roles of their salespeople to the technology used at checkout to appeal to and meet Millennial needs.
Millennials are increasingly ditching logos and luxury brands for unique experiences. In fact, over one fourth of American millennials in a recent Deloitte survey reported no luxury purchases of $500 or more in the last 12 months, whereas the survey average across all groups was only 16%. This doesn’t mean millennials aren’t investing in things that elevate their social status, they just value a unique experience over a luxury purchase. Fyre Festival – the infamous music festival disaster – offers the perfect view of this into millennial values: they were willing to invest in attending the exclusive experience, as it was clearly falling apart around them, because of how much they wanted to flaunt it to their social media followers.
This experience-driven mentality extends into nearly every industry and underscores the necessity for brands to offer unique experiences to set themselves apart from the competition. Whether it’s turning a knowledgeable staffer into a mobile point of checkout or using self-service kiosks to lead to more product discovery, brands can be doing so many things to offer non-traditional experiences to a non-traditional generation.
At the same time, we live in an age defined by instant gratification, with everything available at our fingertips. Consumers can make purchases, get rewards, and more with a single click of a button – anytime, anywhere – making technology an enabler and catalyst for their experience.
Millennials want to feel important, be served instantly, and have their shopping experience be as seamless and painless as possible. Whether they’re making a purchase online, in a checkout lane, or interacting with a mobile checkout employee in an aisle, this generation of shoppers expects their experience to be fluid and frictionless. Brands that fight or ignore that stand to lose the loyalty of these fickle-minded and fast-moving shoppers.
So how can retailers and other merchants tap into these trends and produce alluring, fast, and frictionless experiences for their customers to drive loyalty? To start, businesses should turn to technologies that both create more valuable experiences for their customers and make the more transactional elements of the experience quick, painless, and more invisible.
Brands that successfully provide their customers with a unique experience are ones that invest in technology to ensure customer communication is interactive, simple, convenient and flexible across all channels. These brands showcase how engaging the shopper can happen in many forms, but always ties back to getting Millennials what they want efficiently. And this is an expectation that will only continue to grow in future generations like Gen Z as they come into more buying power.
Take Sephora for instance, where payment has become just a final, simple part of a more intimate shopping experience with their associates. In-store, staffers are cosmetics experts that will do your makeup, offer product samples and guide any customer from product recommendations through to purchase. When it comes time to actually make a purchase in-store, staffers offer mobile checkout, converting a sale painlessly without forcing the customer to wait in line or otherwise waste time on the less enjoyable parts of the traditional shopping experience. The payment becomes a more invisible part of shopping versus a nuisance that caps off the experience.
It is imperative for retailers to take these extra steps to become experience-oriented and use technology to get millennial shoppers what they want efficiently while freeing them from the more dreaded elements of the traditional checkout experience. Brands that invest in offering more than just a transaction will be rewarded with the loyalty of an otherwise-fickle generation of shoppers. So before chasing Gen Z, merchants’ shiny new object, brands must invest in creating experiences that will capture the loyalty and attention of an increasingly-powerful generation of millennials.
Mark Bunney is director of go-to-market strategy for Ingenico Group