Millennials may be buying more items than their non-Millennial counterparts, but they aren’t the be-all and end-all of target marketing. And contrary to retailers’ categorization, their age has less to do with their purchasing habits than we might have thought.
Things are tough out there for retail right now and apparel brands with any hopes of dodging the bankruptcy bullet will have to work with a multidimensional approach to targeting their consumers, one that considers factors other than age.
Retailers have been all about Millennials in recent years—what they want, why they want it, how to give it to them. At times they’ve been so eager to label this group of 18- to 34-year-olds that they’ve lumped them into one, forgetting that the 83.1 million of them who represent 38 percent of U.S. apparel spending, can sometimes vary considerably from one another.
“Everyone’s talking about Millennials now, but there’s real risk in ignoring other generations who still wield tremendous purchasing power,” NPD’s chief industry analyst, Marshal Cohen, said. “And, when it comes to Millennials, the other thing many retailers fail to understand is that not all Millennials are created equal. Depending on lifestyle and life stage, Millennials could be more—or less—likely to buy your brand.”
Millennials can have children or not, be married or not, and their life stage and resulting demands will be largely different depending. Lifestyles, like giving greater value to being more active versus not, also factor into how consumers buy, and, as has always been the case, being into fashion or more traditional matters too.
In breaking down the key factors for consumer shopping behavior, the study found that life-stage differences in buying behaviors are most significant among Millennials.
Millennials are heavy jeans buyers, with 18 percent claiming to buy denim duds frequently compared with 10 percent of Generation X shoppers and 8 percent of Boomers. Not surprisingly—as their generation was the first to deem yoga pants acceptable for work—Millennials also buy more activewear than anyone else.
But those Millennials who have sprung offspring tend to purchase more comfortable clothing, like jeans and activewear. And likewise, single shoppers who often have fewer responsibilities than their wed friends, are simply more likely to shop in general.
“Knowing a shopper’s life stage, fashion attitude, and whether or not he or she has an active lifestyle can improve how brands and retailers connect with consumers across generations,” the study noted. “Whether it’s breaking away from age-based merchandise in stores (no more “Young Contemporary” section) or using social media to create a personal mobile shopping experience, it’s important to cater to a certain life stage, rather than a certain age.”
As Hana Ben-Shabat, A.T. Kearney partner and co-author of the study, added, “Age is only one piece of the puzzle. By targeting Millennials as a cohort, retailers are missing the real drivers of purchasing. It’s important to target each segment and adjust your value proposition accordingly.”
What’s more, though Millennials may purchase a greater number of items, the other generations are spending too. And ignoring them—especially in a market where department store apparel sales are seeing a 4 percent downturn and where there’s only been 2 percent growth in U.S. apparel sales—stands to be a major missed opportunity.
Taking activewear, Millennials are the ones buying it most often but the gap between the generations is surprisingly narrow. Twenty percent of Millennials are likely to buy activewear frequently, compared to 23 percent of Gen-Xers and 18 percent of Boomers.
“Apparel brands and retailers that focus predominantly on Millennials risk alienating other generations of buyers,” the study noted.