Invest in Millennials
If you aren’t selling to millennials, you’re missing a growing market. Millennials are the future of the consumer electronics industry. According to Millennials: The New Face of Retail, a recent study by the Consumer Electronics Association, millennials are larger purchasers of CE products and accessories than any other generation. To top things off, intent to purchase CE in the next 12 months is also higher among millennials.
One thing is for certain, accessories retailers and manufacturers cannot afford to ignore millennials. According the U.S. Census Bureau, there are approximately 86 million millennials in the U.S. between the ages of 13 and 31. This represents a huge portion of the American population (27 percent), and is roughly the same size as the baby boomer population.
Being the first generation to grow up in the digital world, it’s no surprise millennials are more likely than other generations to be early adopters of new technology. This generation is driven to have the latest and greatest because the digital landscape is constantly evolving and advancing. As millennials age and gain more purchasing power and influence, it is important for retailers and manufacturers in the tech industry to understand how they learn about and eventually adopt technology.
When it comes to buying CE accessories, three-fourths of millennials purchased accessories in the past year, which is more than any other generation. Smartphones, laptops and gaming devices were the most popular purchases for millennials in the past year, and it is likely that these were also among the top products for which they bought accessories.
However, not all millennials have the same purchasing behaviors and influence. With an almost 20-year age gap between the youngest and oldest millennials, it’s important to understand the differences between the two major groups of the generation (youth and adult) in order to maximize promotional and selling tactics.
“Youth millennials” refers to individuals between the ages of 13 to 17. While they currently spend less on CE devices than other generations, averaging $229 in past year, youth millennials averaged $80 on CE accessory purchases over the past year, outspending baby boomers (born between 1946 and 1965) and the silent generation (born between 1928 and 1945). It’s critical to gain their brand loyalty now because they will continue to invest in CE products and services as they age and their incomes rise.
“Adult millennials” are between the ages of 18 to 31. In general, they are bigger CE spenders because they have more disposable income than youth millennials. They spend an average of $724 on CE products per year and are spending more on CE accessories than any other generation (on average $174 in past year).
Despite spending less than adult millennials and other generations, it’s important not to underestimate the influence of youth millennials. Youth millennials have a lot of sway in getting the products they want through others. At one point or other, almost all youth millennials indicate they have requested CE from their parents (93 percent), or have had their parents purchase CE products for them (94 percent). In addition, half of youth millennials indicate they “always” or “usually” request CE devices from their parents.
The same goes for CE accessories. In the past year, youth millennials were highly likely to ask for and receive CE accessories as gifts. Similarly, 36 percent of adult millennials were likely to ask for and receive accessories as gifts in the past 12 months.
Youth millennials have a greater inclination for exerting influence compared to their adult counterparts. In the past year, 41 percent of youth millennials gave advice on what to purchase and one-third gave advice on where to shop for CE products to either their friends or parents. Among adult millennials, one-third gave advice on what to purchase and one-fourth on where to shop.
Since millennials are likely to ask for and receive CE accessories, retailers and manufacturers should capitalize on gift advertising for this market during holidays. Targeting family members and friends of millennials will help maximize promotional strategies. Make sure to pair relevant CE accessories with the core devices the generation desires. Guiding a visual connection for friends and family could help spur an additional accessory purchase they hadn’t considered before. Moreover, keep in mind that millennials can create a magnifying effect on purchases because they are likely to hand out advice to others. Providing a comfortable and fun shopping experience is critical if you want your younger shoppers to share their positive experiences with their social networks.
Research is an essential part of the CE and CE accessory purchase process. Two-thirds of adult millennials and half of youth millennials report they carefully research their CE purchases. Millennials learn about the latest technology through many of the same channels as other generations. Millennials say the Web is their most popular tool for conducting product research: Roughly three in five millennials use the Web as a resource when researching CE products and accessories.
What sets millennials apart from other generations is that they are generally more social in their quest to research products. This generation is more likely to discover new technologies through their friends, especially younger millennials. They are likely to ask family and friends about products and test out a product owned by someone they know before purchasing. In addition, youth millennials are more likely to learn about new technologies through advertising, as they have more free time for consuming TV, the Internet, radio and magazines.
Just as they are influential, millennials can be influenced. Millennials highly value word-of-mouth reviews and trustworthy digital resources when researching products. When trying to reach this generation, create messaging that sounds like it’s coming from a friend. This will be critical in reaching youth millennials. Likewise, encourage your social media followers and fans to share their candid thoughts about your accessories products on their own networks. If millennials see positive reviews coming from credible sources, they are more likely to be influenced to make a purchase decision.
CE accessories retailers and manufacturers are likely to influence millennials in brick-and-mortar stores. Brick-and-mortar is the dominant channel for purchasing for the generation. One reason for this behavior is because millennials think it’s important to test out the product before purchasing. Seventy-six percent of millennials purchased accessories in the past year through brick-and-mortar stores, and 66 percent consider physical stores their primarily channel for purchasing CE accessories.
Adult millennials make most of their CE accessories purchases at brick-and-mortar retailers. However, due to higher spending in general, adult millennials are among the highest revenue generators of online CE accessories purchases. So, in order to reach youth and adult millennials, it’s important to have a multi-channel presence (if possible) in stores and online. All promotions should encourage testing before purchasing and include product demonstration videos so millennials can view how the product enhances their core devices and their lives. Since consumers cannot physically test products online, it could be beneficial to offer a small trial period following the purchase with time to make a fully-refunded return if not satisfied.
Chances are that millennials are buying your products. Are you doing everything you can to maximize your marketing promotions for both the younger and older segments of this generation? If you plan carefully and work to understand the purchasing behaviors of this generation, you have the potential to create a loyal generation of customers for years to come.