It's easy to think of shoppers as a one block of consumers, but it's important to remember that what shoppers want and how they behave can vary by age groups. It's true that most sales boil down to someone going to a store or ordering online, but understanding consumer preferences and expectations can help business owners create better experiences for customers. A recent survey showed that millennials and baby boomers have expectations for shopping experiences that may surprise retailers.
First Insight recently conducted a survey of 750 participants in the U.S. "to document their shopping habits, purchase behavior, discount expectations and the influences driving these purchase decisions". The study showed that discounts, online marketing and in-store deals can drive sales, though not necessarily in the way retailers may expect.
One of the more interesting takeaways from the research is that deals are more important to younger generations. According to the survey results, nearly three out of four (71 percent) millennials are visiting multiple stores to find the best deals, compared to 57 percent of baby boomers. This goes against the conventional wisdom that baby boomers would be more interested in finding deals in-store.
Keeping with the expectations of business owners, four out of five (81 percent) millennials are still going online to search for deals. The study shows that searching online for discounts is becoming a dominant shopping behavior within both generational groups. Nearly two-thirds (65 percent) of baby boomers are searching online for the best price which is a higher percentage than the baby boomers who are searching for deals while in-store.
"The retail industry has been operating on the outdated assumption that Boomers are shopping for deals primarily in-store and Millennials are searching for deals mostly online," said Greg Petro of First Insight in a press statement. "The behavior between these generations is evolving, and to benefit, retailers must recalibrate their approach to marketing, inventory and pricing to attract deal-seekers who may have been overlooked based on outdated perceptions."
Conventional wisdom also suggests that discounts and coupons would work best for consumers with less money, but that isn't necessarily always true. Everyone loves a good bargain, even the affluent. According to the First Insight research, while annual income appeared to be less impactful on Millennial behavior, Baby Boomers that make $100,000 or more a year are 17 percent more inclined to search online for deals than in-store (77 percent versus 60 percent).
It may seem counterintuitive, but consumers who earned less than $100,000 a year were less likely than the more affluent counterparts to search for discounts. For Baby Boomers making less, the difference between there's and millennial behavior was far less significant, with only six percent more inclined to look online versus in-store (62 percent versus 56 percent).
There was also evidence from the report which shows how these consumer behaviors can vary based on region. While baby boomers and millennials on the west coast use online and in-store shopping channels in equal amounts, shoppers in the midwest are making huge moves towards more online shopping. Meanwhile, consumers in the northeast and the south are seeing a greater focus on discounts.
All of this data goes to show the value of understanding a business' target audience. Not all shoppers are the same, they may want similar things, but they can take different routes to get to what they want. Understanding the way consumers in your region react to online marketing and deals can help business owners increase sales this holiday season.
For more recent research that can help business owners create better marketing campaigns, read this article on reaching grocery shoppers in an online age.