In order to sell products, you have to know your customers.
Some millennials have a reputation for being either lazy, unemployed, broke, or all of the above. However, it is time to change how society, especially older folks, view them. They are no longer teenagers. No, they are not doing the crazy and often dangerous challenges on YouTube and TikTok. The oldest members of the Millennial generation are 40 years old. The rest are in their 30s or late 20s. They have stable careers now. They are getting married and having kids, and they are buying their own houses.
Moreover, they are now shaping the market according to their values and priorities.
Millennials have not reached their full buying potential yet, but soon, they will. When it happens, they will spend over a trillion dollars every year.
In addition, they are set to become really affluent. They will inherit the wealth accumulated by their parents, Baby Boomers, and become the richest generation ever.
As consumers, what do they want? Bargains.
Millennials are Deal-Hunters
Millennials are very adept at shopping for discounted items. They love a good bargain, perhaps more than their Boomer parents and the Generation X before them. They know how to, or sometimes prefer, thrifting. They collect vouchers, but mostly digitally. And, they know how to use the internet to find the best deals around.
This inclination toward bargains influences the choices they make when choosing financial products and services. They tend to go with an online shopping rewards credit card because it gives them something back. They get points, gift cheques, free items, or a portion of the cost they spent while using the credit card.
A survey conducted by CreditCards.com found that a third of the 2,500 American adult respondents want a card that offers a 3% cash-back. Meanwhile, 22% said they would opt for a US$500 sign-up bonus.
This is the generation that witnessed not one, but multiple financial crises within their lifetime. Between 2007 and 2008, just when many of them are graduating from university and entering the workforce, the global financial crisis happened. At the time, Singapore was one of the first Asian countries to fall into recession, an impact of the weakened economies of the U.S. and the United Kingdom. Millennial Singaporeans also bore witness when their parents struggled to keep employment or find a job during the 1997 Asian Financial Crisis.
Now, they are facing another financial crisis — one that was caused by a deadly pandemic. Although Singapore was spared by the wrath of COVID-19 due to strict border controls and the public’s compliance to health protocols, the economy of the city-nation shrank. In 2020, Singapore went into recession.
As a result, they are more mindful of how they spend their money. About 80% of all Millennials make a purchase based on price. For a while, this has led to the rise of fast fashion brands such as Forever 21, Topshop, and H&M.
Moreover, the majority of Millennials spend time looking for coupons and discounts. On average, they spend around three minutes looking around for a voucher.
What Singapore’s Millennials are Buying
The same trend can be observed in Singapore. Millennial Singaporeans are always looking out for deals because they do not see a reason why they should pay full price. In their perception, buying a product full price is just giving more money to corporations that are already very rich.
They, however, are willing to spend more on experiences. Like the Millennials around the world, Singapore’s young generation enjoys going on holidays. They pay thousands of dollars for a nice trip out of the country, but they are also open to budget trips to a nearby destination. They believe that travelling is an enriching experience that improves their lives.
They also like to be entertained. In one study, 40% of Millennials in Singapore who shop online bought products in the entertainment category in the past 12 months. Moreover, over half of their income went to the acquisition of event tickets.
When they are buying products, aside from convenience, young consumers said that they choose e-commerce over traditional retail because the products are often cheaper. Many of them also make purchases from an e-commerce site abroad because of the free or lower cost of shipping.
Marketers cannot afford to ignore Millennial consumers around the world because they are a large demographic with enormous buying power. But, they are different from the generations before them. They also support social causes and base their decision to make a purchase on whether the brand’s values align with theirs. They are also influenced by the cost of the product, and they enjoy hunting for bargains.