Customer Radar Blog

CX in 2019: Catering for millennial customers

08 November 2018

The new wave of younger customers has been challenging the paradigms of what is required of businesses when it comes to customer experience. Call them millennials if you will, or Gen Y, Gen Z - they are reshaping traditional ways companies think about anything from purpose and reputation to the way they ship their orders. This is because of what was important to customers belonging to one of the previous generations, may not be as important to the younger audience, and vice versa. It is also said that this new generation is the first one in a long time to be worse off than their parents, surging costs of living slashing their disposable incomes and their ability to own assets.

Instant availability of information and purchases in the digital age have caused changes to the millennial's spending behaviours. Today's millennials are spending more than twice the budget on dining and takeaways as they are on clothing. This comes in contrast to eight years ago when the clothing retail spend outweighed food takeaways spend by around 30%.

The increase in food spending correlates with a general increase in online grocery and clothing shopping activity over the last few years. Businesses are increasingly being aware of the shifting needs of their audience and some are pivoting quickly to benefit from this shift to customer-centricity. The requirement for convenience has allowed grocery chains such as New World and Countdown to offer ‘click-and-collect’ type services as well as online shopping with a delivery service. Uber has diversified into the food delivery space with Uber Eats, cashing in on the customer need for ease and flexibility.

When it comes to online shopping, getting the mix of user experience and convenience is crucial, with direct implications on business revenue and customer longevity. 40% of all millennial online shoppers will abandon their shopping carts if they don’t find convenient or timely shipping options available. As the shipping options are usually presented at the end of the buyer journey, shoppers are turned off returning to the business website in the future. Businesses are not only missing out on revenue but can also jeopardise their online reputation, as 34% of millennial shoppers globally will leave a negative online review following a poor delivery experience and 56% won’t come back at all.

The kiwi millennial shift to more of instant gratification and ‘experiences over things’ is often tied to the change in their living circumstances, as mentioned earlier, causing them to spend more and save less. This modern mix of eCommerce, convenience and shifting attitudes is a great benefit to businesses across the retail, hospitality and accommodation industries. It’s easier and more affordable than ever to travel and stay somewhere thanks to the proliferation of discount travel aggregation sites like Skyscanner and Webjet, while cheap accommodation is made possible at every tier of consumer spend through, Airbnb.

FMCG and hospitality companies, empowered by market research and customer feedback, are diversifying their product and service range to carer for millennials. Where the baby boomer generation’s pub patrons based most of their decisions on price and value, millennial drinkers are considering factors like the environment, sustainability and health factors when ordering a tipple. 62% of millennials would intentionally avoid a product or service from a business seen to have a negative impact on the environment, and 65% of millennials drink more than 3 types of alcoholic drinks (compared to baby boomers who stick to 2 or less). Alcohol producers are taking note and changing their offerings to suit - local and international companies increasingly concentrating on low-carb and low-alcohol options.

In order to anticipate consumer behaviours and achieve sustainable growth, companies need to learn from its present and future customers. Innovating and shifting with the times should be at the top of the agenda for any agile business. What has worked yesterday may not work tomorrow, and where better to learn about customer needs but directly from the customers. Talk to us at customer radar to get your business set up with a seamless, live customer feedback programme today.


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