By: Mayer Danzig, SVP of Product Management, Research Now
On May 14, CNBC reported that Retail’s woes deepen, sparking a selloff and depressing stocks (Macy’s, Dillard’s, Kohl’s, etc.) …as more sales shift online, helping the likes of Amazon and Wayfair. To remain competitive, says Thomson Reuters Director of Research Jharonne Martis, retailers must reduce store footprints, retrench in ecommerce, and appeal to Millennials.
To understand what Millennials really want, we recently surveyed 800 Millennials (Shopper Intelligence/Research Now, May 15-16, 2017.) For their top Mother’s/Father’s Day shopping destinations, they named Amazon, Walmart, Target, and Macy’s (as a distant fourth.) If Wall Street’s doom-and-gloom predictions ring true --- where digital online/mobile ecommerce wins, and brick-and-mortar languishes cataclysmically --- then how did Walmart, Target and Macy’s garner 3 of the top 4 shopping spots? Furthermore 4 out of 5 respondents told us they did less than half of their shopping online, for popular items like flowers, clothing, gift cards, and cosmetics. Brick-and-mortar appears to occupy a share of Millennials’ minds and wallets still, but how?
When asked if there are any physical products they would never buy online, 40% cited food/grocery and automobiles. On the other hand, 2 out of 5 Millennials listed books, clothing/apparel and electronics among items they would always buy online. There are clearly significant differences in consumers’ need to ensure freshness in perishable consumable goods like food and flowers, versus the need to experience and “try before they buy” high-dollar-value purchases like automobiles or brand-name apparel.
Once they have decided to make a purchase online, 80% of Millennials will purchase in-app and not on a retailer’s online website. This has clear implications for retailers’ online-vs-mobile app ecommerce strategy.
But how do they find out about new products to begin with, and why do they choose one retailer/e-Tailer over another? To answer these questions, we had to refer back to the not-so-distant past.
Last November, when we asked 1200 Millennials how they found out about the best Black Friday or Cyber Monday promotions, respondents ranked Online Searches (39%) and Online Ads (36%) ahead of TV Ads (15%.) When pressed further about which communications tactics ultimately influenced where they shopped, respondents ranked Word-of-mouth (89%) and Online Advertising (87%) the highest, the most popular purchases being clothing, consumer electronics, entertainment, and gift cards.
Affluent Millennials --- those earning household incomes of $100K or more --- showed the greatest percentage increase year/year in Holiday Promotion shopping intent, including both in-store Black Friday and online/mobile Cyber Monday. Simply put, even affluent Millennials are value-conscious and sensitive to promotions.
One comparison was especially surprising. 20% of Millennials planned to shop exclusively at brick-and-mortar retailers for Mother’s Day/Father’s Day, versus only 5% for the Holidays five months prior. Putting the pieces together, this paints an interesting picture. Perhaps brick-and-mortar can play an important role still in the customer journey. A place where fresh flowers and produce can be perused up close, smelled, and tasted; a new Tesla can be sat in and test-driven; and the new $500 Big Baller sneakers can be ogled and tried on for size --- in short, experienced.
So, what does this all mean? Millennials appear to be complex, value-conscious and wise. They seem to positively exemplify Google’s Zero Moment of Truth when making purchase decisions. Favoring authenticity (word-of-mouth) over promotion they rely on the former --- together with personal experience --- to verify the quality of the latter.
Savvy retailers and e-tailers understand the importance of marketing to and activating Millennials the “right” way - across each stage of the customer journey: amplifying messages of “value” via Online Search and Ads to drive Awareness; rewarding Ratings, Reviews, and Referrals to generate positive word-of-mouth; providing a physical venue to allow Millennials to try and experience products; and last but not least, making the products easy to buy --- whether it be in-app, in-store, or online.
Predictable omni-channel marketing for the consummate omni-shopper.
About the Author: Mayer Danzig serves as Senior Vice President of Product Management at Research Now where he is responsible for defining and developing the next generation of Research Now offerings. Danzig is a digital business executive with nearly 20 years of professional experience in business development, operations, and product management. Before Research Now, he served as Chief Digital Officer for Kantar Retail where he led the transformation of the company’s online business and achieved double-digit growth by launching new products and extending the reach of existing online services. Prior to Kantar Retail, he held various product leadership roles at Thomson Financial (now Thomson Reuters) and CCBN (acquired by Thomson), where he led the turn-around of Thomson’s flagship research product and was awarded a patent for an interactive investor webcast solution.