As I move through my Masters of Business Administration program, I am learning more and more about how consumers make purchase decisions. When it comes to Millennial spending habits, I keep coming across three major trends. These changes may be temporary, but more likely they are permanent and are maxims by which marketing managers should set their watches. I have noticed that:
- Millennials are price conscious to a fault: Due to the Great Recession of 2008 and the ensuing economic recovery, Millennials are very price sensitive, often sacrificing brand recognition or prestige for economic efficiency. A good example of this is in automobiles. Those of us who can afford to buy cars are buying cars that get 35 miles to the gallon, regardless of make, model, or overall horsepower. Doing so is considered classy. Hummers, Mustangs, and other gas guzzlers are gauche and wasteful, regardless of how fast they go.
- Millennials are making socially conscious product choices: More than any past generation, Millennials need the companies they support to align with their social values. The most recent iteration comes in the form of companies like SalesForce and Angie’s List pulling business out of Indianapolis because of a passage of a bill unfavorable to the LGBT community, or Star Bucks’ (misguided) attempt to start a national conversation about racial equality by writing “Race Together” on its products. Overall, if we can afford it, Millennials will make sure their money goes to companies that promote the general welfare.
- Millennials crave social media interaction, or other interaction, that makes the brand seem personally relatable: Social media is vital to a Millennial’s perception of a company. Television commercials and print advertisements are so obviously formulaic and generic, so the way we try to seek out information about the essence of a company tends to move toward social media. Because of the spur-of-the-moment nature of social media, by interacting with a brand on Twitter or Facebook or wherever else, we cut through the crap and judge a brand by how its represented by its Tweets and Instagram photos.