Much ado has been made over the differences in the mindsets of Baby Boomers and Millennials. In regard to their habits as retail consumers, the adults of the Millennial generation have often been painted as volatile, demanding, brand schizophrenic, overly obsessed with online shopping, and disproportionately swayed by word-of-mouth and peer product reviews. To many, Millennials are a retailer’s worst nightmare: a legion of boogeymen destined to discombobulate the delicate balance of the consumer-retailer relationship dynamic that has thrived in the half century since Baby Boomers first reached the pinnacle of their market-shaping powers.
Though there are some legitimate reasons for retailers to be concerned about the waxing influence of Millennial consumers and the gradual waning of Baby Boomers, one must wonder if the majority of the hysteria over this changing of the consumer guard is rooted in a deeper fear of the unknown.
Baby Boomers have long been a well-known and understood population segment. Boomers are, after all, the nation’s golden generation having been born out of the pangs of war and into what many considered to be a new world ripe with hope and prosperity. They are the generation that grew up right alongside venerable titans of the retail and foodservice landscapes, including early incarnations of Walmart, CVS Caremark, and McDonalds. Now, however, more and more Boomers are moving into retirement age and are likely to become less active and influential in the retail segment even as they persist in being a relatively more affluent group of consumers, according to Americans in 2020, a market research report by Packaged Facts. The report forecasts that the number of adults age 65 and older will jump from 41 million people in 2010 to 56 million by 2020, accounting for a substantial portion of population growth in the coming years.
The graying of America leaves the future of the retail landscape in the hands of Gen Xers and precocious, but at times unpredictable, Millennials. The young adults that comprise the Millennial generation have different value equations for the products they purchase and consume compared to Boomers and seniors. Perhaps even more importantly, these young adults have an aggressive mentality when it comes to their consumption tendencies. They want what they want, when they want it, and they expect more for less. They are adventurous and are less likely to fall into the lull over strict brand loyalty, which was the hallmark of Baby Boomers. In essence, the Millennial consumer profile is built on convenience, flexible/non-existent brand loyalty, and price sensitivity. Essentially, these profile components are tied into each other. For instance, Millennials desire for convenience and lack of brand loyalty means that they are more likely to explore alternative distribution models (i.e., smartphone shopping, online shopping, direct delivery services, etc.) outside traditional retail venues, especially if they can find better prices through these non-traditional methods. They are also more likely to spread their shopping across a variety of brands and channels (including mass merchants, store clubs, drugs stores, online, convenience stores, etc.). The result is a brewing storm of pressure for established brands, retailers, and marketers to meet the shifting expectations that come with this power struggle.
Despite the obvious differences between these generations of consumers, Millennials are not the complete antithesis of Baby Boomers.
In fact, there are similarities that make them in many ways two sides of the same consumer coin. Millennials are renowned for their savvy new media knowledge thanks to the pervasiveness of smartphones, but Boomers are no slouches when it comes to taking advantage of the opportunities presented by new media and technology. According to market research company Radius, more than 85% of both Millennials and Boomers routinely research products online, both are regular users of social media, such as Facebook, and both increased their purchases of technology products in 2013. Being aware of such overlap between the generations provides marketers opportunities to reach both segments simultaneously, while also aiding in the transition to more Millennial-focused forms of marketing content in the future. Millennials and Boomers both also tend to be focused on quality or price/value when shopping, despite Boomers’ more intrinsic brand loyalty. The fact that brick-and-mortar retail stores are favored by both when shopping for most everyday packaged goods, apparel, and electronics, serves as further evidence that the transition from Boomers to Gen Xers to Millennials will not be the apocalypse so many anticipate.
There is irony in the fact that Bob Dylan, one of the most prolific and highly regarded figures of the Baby Boomer era, is adored for his chameleonic tendencies, his deliberate manipulation of his public persona, and his knack for making himself heard even in a sea of voices. The man’s a walking, mumbling, guitar-strumming Twitter feed unto himself. He may be more of a Millennial than anyone born in the 1980s, 1990s, or 2000s. And as Dylan proved in his appearance in a recent Chrysler Super Bowl commercial, the Boomer voice hasn’t been silenced quite yet. Indeed, it is mingling nicely with the rising tide of voices from the mouths of Millennials. Each generation may march to the beat of a different drum, but in the end all that matters is that they bother to march at all and that they do so with a purpose. It’s up to retailers and marketers to discover that purpose, to unlock the secret motivations of why Millennials do what they do when shopping. If indeed there is nothing so constant as change, why then live in fear of the inevitable? Those that embrace change embrace the future. Thus, retailers and marketers that embrace Millennials today, even while holding firmly to their longtime dependence on Baby Boomers, will be better equipped to withstand any changes looming on the horizon.