In today’s shifting retail landscape where access is endless, Millennials are starting to see e-commerce as its own form of entertainment and are less likely to shop with intent to buy than prior generations.
Consumer insight company The Intelligence Group (TIG) conducted an online poll of 1,300 Generation Y and Z shoppers ranging in age from fourteen to thirty-four, and uncovered four trends that set these young shoppers apart from their predecessors: the Fauxumerist mindset, the MEtail culture, NOwners and the Gut Check response.
Millennials and Gen Z’ers, in their constant connectedness, are redefining the act of shopping and the intention behind it, the report noted. “These empowered consumers see the world as an always-on, unbounded retail environment, in which everything they encounter is either clickable or searchable–and, in turn, gettable. They are constantly tracking and sharing products, soliciting the opinions of friends and experts, and, most importantly, defining themselves through the products they purchase and brands they support.”
In the Fauxumerist mindset, shopping is as much about product discovery as it is about purchasing. “Modern-day consumerism isn’t just about consuming,” the report noted. “Gens Y and Z shop without feeling any need or compulsion to buy. Browsing (both online and off), trying and testing, pinning, wishlisting, and happening upon covetable products are enjoyable acts in and of themselves–they don’t require the “validation” of a purchase.”
Browsing for products on sites and apps has become a leisurely pastime and a new form of expression.
“Before, the only way an individual could demonstrate their appreciation of a product or their allegiance to a brand was to purchase and sport it. But now, individuals can achieve the same end by simply storing, pinning, posting, or otherwise sharing images of products that they feel help to define their style.”
But retailers have no need to fret. While these generations may not always be shopping with purpose, they are shopping passively, which means the number of potential purchase paths is greater, according to the report.
“Marketers should support young consumers’ fauxsumerist impulses, as a means of encour- aging interaction with products even when a purchase is not immediately impending,” the report noted. And brands should be helping consumers discover products organically through e-commerce arenas that encourage shoppers to click through a collection or by building experiential spaces where shoppers can discover items they may not have found by direct search.
TIG researchers reported seeing a rise of the MEtail culture, or the notion that every consumer can also be a merchant. “The Web has made it easier for individuals to be more than just consumers in the marketplace, providing platforms for funding, marketing, manufacturing, selling, and distributing pretty much anything one has to offer.”
Because of platforms like Etsy, the e-commerce marketplace for handmade and vintage items, Millennials and Gen Z’ers are conditioned to think they can create, promote and even sell, anything they want.
“The MEtail trend signals a restructuringâ€¨of the relationship between consumer and brand. Today, individuals not only support companies but they also compete with them. This is not to imply brands are any less relevant in the retail landscape; however, it does urge them to adjust to a new way of thinking brought upon by this paradigm shift,” the report noted.
If consumers don’t see something they want, they are likely to work on creating it themselves. Brands will do best to work with this trend rather than against it, according to TIG, and they should try to collaborate with independent creators.
“Companies may consider funding amateur projects, offering workshops and tutorials where individuals can learn new crafts, and providing resources to help these would-be sellers manufacture what they make. When relevant, brands can also offer collections in which to feature MEtailers’ goods, as Nordstrom and West Elm do through the Etsy Wholesale program, or task amateur artists to design items for mass production,” the report said.
Millennials are a sharing generation and TIG noted seeing an upsurge of platforms that encourage consumers to resell, rent, borrow and trade items they might have otherwise purchased, a shift researchers labeled as the NOwners trend.
“For Ys and Zs, the prioritization of access over ownership seems only natural. Accustomedâ€¨as they are to digital content, much of whatâ€¨they own lacks a physical presence. Movie downloads, ebooks, and mp3s only exist inâ€¨the cloud, where they wait to be “pulled down” for viewing or listening. As such, there’s little conceptual difference between owning an item and accessing it. Their digital ownership is really just about usage,” according to the report.
Sharing platforms are becoming mainstream and consumers will be thinking differently before buying. According to TIG, Forbes estimates that revenue from the share economy topped $3.5 billion in 2013, a 25 percent growth over 2012.
Most brands won’t be able to sway shoppers to rethink purchasing altogether, but, TIG noted, they should position themselves as proponents of the sharing model for its economic and environmental benefits.
TIG foresees “the rise of brand-sponsored communities through which individuals can connect with one another to trade, resell, or share brand-specific products, as well as enhanced, cross-category “subscription services” (like Netflix) which will allow members to regularly trade in or upgrade a company’s items. These and similar innovations will appeal to young consumers’ NOwner inclinations, without sacrificing brand recognition or loyalty.”
The fourth trend TIG’s report touched on was the Gut Check response. Today’s consumers are so flooded with purchasing options and product information, that seeking validation prior to a purchase has become the status quo.
“The increased ease with which one can source advice and assurance–via online reviews, comments, likes and upvotes, crowdsourced Q&A sites, and quick requests for approval via email, text, or status update–has inspired the rise of an instinctive Gut Check response to even the smallest, most inconsequential daily choices,” the report noted.
Gone is the idea of “going with your gut;” these shoppers want to make well-informed choices. They turn to peer reviews and Q&A sites and apps like Quora, Wikianswers and Jelly, for answers about a product’s characteristics, quality, fit and peer reception.
“These pre-purchase gut checks have become shopping second-nature among Gens Y and Z. And, for â€¨all the recent worry about showrooming, few outlets have grappled with the fact that in-store shoppers are not using their mobiles just to check for lower prices online; they are, in effect, confirming whether or not they should purchase the product in question at all.”
This gut check trend isn’t great for new brands that haven’t yet collected a reasonable number of reviews.
But, “Facing off with larger companies whose items have already experienced the snowball effect of positive reviews could prove prohibitive to early success,” the TIG report noted. “Marketers who find themselves in this position should invite and incentivize reviews from the earliest stages, to build up a base of support that will in time provide validation for a future shopper’s decision to buy.”
While the ways of youth shoppers may seem puzzling, TIG said, “brands and retailers should be excited by the open, innovative nature of the new consumer landscape.”