The next big thing is already here: Millennials.
Millennials, those born between 1980 and 2000, are America’s largest living generation. Currently, there are more than 80 million Millennials in the U.S., spending upwards of $600 billion each year. By 2020, it is projected that Millennials’ spending in the U.S. will rise to a whopping $1.4 trillion annually and represent 30 percent of total retail sales.
These young adults possess immense buying power, leaving many small business owners wondering how to tap into such a lucrative revenue stream.
Five ways small businesses can attract millennial shoppers:
Think access, not ownership. Millennials are less interested in buying and owning products than previous generations. Instead, they’re turning toward services that allow them access (think Airbnb and Uber) without the responsibility of ownership. As a result, a “sharing economy” has emerged. Small businesses should consider ways they can tap into the notion of sharing. Local hardware shops offer a tool-sharing program. Used bookstores can offer a paid membership for customers that want to “rent,” read and return.
Create sharable experiences. If the sharing model isn’t a fit for your business, create sharable moments. In general, Millennials prefer experiences to ownership. Rather than simply selling, provide engaging experience Millennials can share with family and friends – and on social media. Offer interactive events to showcase your products and services. If you’re an arts and crafts store, for example, host a scrapbooking workshop where participants can enjoy making something while getting to know you and your specific offerings.
Show your authenticity. Millennials want to engage with companies that are authentic in the products and services they provide as well as the causes they support. Many Millennials don’t trust advertisements; they aren’t moved by flashy ads, big promises, and ‘wow’ factor. They seek authentic brands, messages and interactions. According to Forbes, 62 percent of Millennials say that if a brand engages with them on social networks, they’re more likely to become a loyal customer. On your website and social channels, provide helpful resources, be responsive and share candid moments that show off what makes your business – and its employees – unique.
Showcase sustainability. Millennials have a propensity for environmentally-friendly brands and products. In fact, 73 percent of Millennials are willing to spend more on a product if it comes from a sustainable brand. Retailers should make a point to showcase products that are grown and sourced locally. Grocery stores and other retailers can offer discounts to shoppers who bring reusable bags.
Give back to make an impact. At the end of the day, Millennials enjoy the satisfaction of doing their part to make the world a better place. They care about being socially responsible and want to engage with companies that are involved in local events and give back to the community. Participating in or sponsoring a nonprofit event? Tell your customers, take pictures and promote it online. By setting a good example through your company’s actions and providing community involvement opportunities through partnerships, events, and sponsorships, your company can inspire Millennials to make a difference.
Don’t forget that Millennials are humans, too. The best way to market to them is to understand their unique values and buying preferences. Oftentimes, companies forget that each generation has its differences. The future of our businesses and economy depends upon the behaviors and decisions of Millennials. So no matter how big or small your company is, be sure to take Millennials into consideration when marketing your business.