Maximising your share of millennial spending
Around 2 billion potential customers
Millennials are classed as those born between 1980 and 2000, and now account for approximately 27% of the global population. That’s around 2 billion consumers. Within Europe, they constitute 8% of the population – or about 160 million potential customers.
In 2015, millennials spent US$2.45 trillion globally – so if you can offer these consumers the right payment process, and options, you could soon reap the benefits.
What are millennials looking for?
Millennial shoppers have three key characteristics. They are:
a) Tech savvy
Millennials have grown up using technology. Their mobile phone is a central part of their lives. They use their phone to socialise, share information, research and purchase. It’s probably no surprise that millennials have a higher propensity to buy online than any other age group.
Due to things like student loans, many millennials are in debt, and although they still make purchases, they are careful with their spending. Whilst quality is a key purchase driver, price is more important to them. So offering more, and cheaper, delivery options (such as free delivery or pick up from store), or targeted personalised promotions, can go a long way to developing loyalty.
Use of social networks like Snapchat and Instagram are popular amongst millennials. They are more likely to share their whereabouts and recent purchases via social then other age groups. Brands who can find a way to interact and engage with consumers via these platforms will help build long-term relationships.
Millennials and shopping
Although price is a key driver, millennials are also looking for a great shopping experience. And while they have a propensity to buy online, the in-store experience is still important. They are looking for tailored offers and a personalised experience – through all channels and interactions with a brand.
It’s therefore key that retailers focus on their omni-channel offering. When a millennial walks into a store, they assume merchants know what online purchases they’ve made. They expect recommendations based on past purchases. And above all – they want to feel valued. Our Worldpay Total product can help you achieve this.
Millennials are also one of the most influential groups in fashion sector. Recent figures show that they account for 25% of all spending dollars – and this is only expected to grow as their spending power increases.
"Millennials are tech savvy, social and frugal consumers" - Lee Goddard
Millennials and Travel
European millennials took approximately 150 million outbound trips in 2015. The length of the journey – and the type of accommodation booked – is very similar to other age groups. But generally they spent less on their visits.
The biggest difference in millennials comes when you look at what they want from their trips abroad. They are seeking authenticity – but also want control over their activities. Millennials are also looking to experience new cultures and engage with local people.
They are also more comfortable with travel providers holding their data, as they believe this will enable their provider to offer more personalised itineraries. This offers travel companies the ability to open up new revenue streams by upselling travel add-ons to millennials, with relevant, timely offers which aid a seamless travel experience.
Millennials’ shopping journey involves multiple devices – so it’s key you optimise your website, and payment process, for web, mobile and tablet.
When it comes to payment methods, millennials' use of mobile means eWallets should definitely be included. Their financial situation also means they are looking for options which will allow them to either pay in instalments or delay payment. For example, according to our research, 48% of Brazilian millennials would pay for their vacation in instalments if it was available.
One solution is Klarna – the ‘buy now – pay later’ e-invoicing payment method which is growing in popularity across Europe.
Klarna gives customers flexible payment options, allowing merchants to offer them the ability to pay on delivery or in instalments. It’s currently used by over 70,000 online merchants, serving 65 million consumers across Europe. We’ve recently added Klarna to the suite of payment options our customers can offer. So, if you operate across Europe and want to attract more millennial shoppers, download our brochure now.
If you want to find out more about the purchase behaviour of millennials, and how it differs across markets and categories, visit our ‘Why Do They Pay That Way’ interactive tool.