Building Compelling Retail Digital Experiences for Millennials and Gen Z

Building Compelling Retail Digital Experiences for Millennials and Gen Z

Building Compelling Retail Digital Experiences for Millennials and Gen Z

This post was recently updated. Originally published on December 14, 2021.

Millennials make up a significant and large part of today’s retail environment. At the time of the last census, in 2020, there were 72.1 million Millennials in the United States, edging ahead of Baby Boomers (71.6 million) for the first time and making them the largest generation alive today.

The term ‘Millennial’ can be applied to anyone born between 1981 and 2000 (although some put the cutoff point at 1996). Now that this generation is entering its prime spending years they will be an increasingly important consumer group.

Millennial income is expected to reach an estimated $8.3 trillion by 2025, far surpassing other generations. However, while Millennials represent a huge consumer group, they are often struggling financially. A survey by Deloitte this year found the cost of living to be the top concern for both Millennials (29%) and Gen Z (36%). Unsurprising, given almost half of these groups live paycheck to paycheck (46% for Gen Z and 47% for Millennials.)

These generations are considered more digital than any before it. Millennials make 60% of their purchases online on average, with 86% making at least some of their purchases online. They also think it is easier and more convenient to research by themselves or message customer support than going to a brick-and-mortar store and asking salespeople for help.

In addition to their digital preferences, Millennials often exhibit three distinct traits:

To meet the demands of this unique consumer and help capture the generation’s growing spending power, retailers must continue to invest in new technologies and digital shopping experiences.

Let’s dive into how brands can take advantage of the omnichannel customer journey, mobile experiences, social media, and corporate responsibility to reach and secure the Millennial consumer today and into the future.

Online Shopping Biggest Among Millennials

Merchants are shifting toward a fast and efficient customer digital shipping experience to meet the demands of the Millennial shopper. Across all platforms—in-store, mobile and online—retailers continue to focus on entertaining Millennials by making their brand most appealing from a fast and digital perspective.

In other words, digital retail has simply become an extension of the real world.

Technology is —and will continue to be — an important tool in reaching the Millennial audience, which tends to be the market that tries new technologies and trends first. Keeping pace with digital trends can help brands stand apart from the competition.

Millennials are online detectives. They actively seek out reviews and feedback that will help them evaluate products before purchase. And that isn’t just which products have the highest rating. 97% of Millennials actively look for negative reviews, with 60% looking for one-star reviews.

So brands that can provide a fast, informative, and convenient digital customer journey, allowing customers to research, compare features, and read reviews, will be able to keep Millennials’ business and attention.

A large part of providing a seamless digital retail experience is maintaining your website. Even if you own a brick-and-mortar store, your website often is the consumer’s introduction to your brand. How much time a customer spends browsing products is based mainly on a website’s ease of use. It can also be the difference between a sale conversion or returning customer and the high bounce rate.

Ease of use should be at the forefront of any website, and a large part of that is making sure your web experience translates seamlessly between devices. Your website should load smoothly on mobile phones, tablets, desktop computers, laptops, and more. If customers cannot find what they’re looking for easily, they are more likely to find it from a competitor.

Mobile Shopping Crucial for Gen Z

While Millennials are keen users of mobile (42% of them use their phone as the most regular way to shop) they are outpaced by Gen Z’ers, 52% of whom list mobile as their go-to device.

If your website is not already optimized for mobile, it can be a simple and effective way to improve your site’s user experience and design. Many brands are adding mobile-friendly features to their digital shopping experiences, such as AR messaging and filtering and text-based searching and shopping. An optimized mobile shopping experience can also include curated and personalized purchasing suggestions and real-time order-tracking capabilities.

Retailers should always use mobile to enhance loyalty programs. A great loyalty program should now be easily accessible through an app, easy to use, relevant, and give back to customers. Loyalty programs are an easy way to improve online and in-store sales and gain valuable insight into customer profiles.

Social Media, Brand Experience Key to Reaching Both Groups

Millennials and Generation Z are not using their phones simply to make purchases. Social media is a big part of the mobile experience, with 58% of Gen Z having used Instagram to discover new products (for Millennials it’s 34%) The Social Commerce market – direct selling on social media – is growing fast, projected to be worth $604.5 billion by 2027, with the mobile segment of social selling growing at almost 40 percent a year until then.

Both generations are avid users of the internet, but the way they use it differs. While Millennials (59% of them) use the internet to find information, Gen Z (72%) use it primarily for entertainment. 82% of Gen Z’ers say they are more likely to buy from a company that gives them consistent and relevant content.

That means brands who can integrate social media into an exciting omnichannel strategy, especially using video on platforms like Snapchat and TikTok to draw customers to their brand, will be well placed to win the attention of Gen Z shoppers.

Millennials love social media too. In fact, one survey found that they are the generation that is most likely to be influenced to make a purchase by something they see on social media. But, as with online reviews, Millennials look to social media as a way to gain confidence in making a purchase, with 38% of them using posts from friends and family to help them with their buying decisions.

Being able to use social media as part of a smooth customer experience that is consistent across channels is also key to winning over Millennials. Famously, this generation places huge importance on the customer experience. 68% of Millennials regard an integrated, seamless omnichannel experience as essential.

Building an immersive experience beyond social media is essential for brands seeking both demographic groups’ loyalty and purchasing power. To do this, brands need to have the data, testing, and analytics capabilities that will allow them to provide personalized digital experiences in real time.

Customer data is more critical than ever to create a holistic view of each customer and keep up with their changing behaviors and preferences.

Knowing a customer’s preferences, purchasing and browsing, and loyalty program activity can help brands facilitate timely and relevant product suggestions and promos—whether that’s via your website, social media, or email marketing.

Millennial consumers expect retailers to know what they want, even before they do, and provide product recommendations and personalized experiences.

A New Focus on Values

Beyond a seamless digital experience, a brand reputation that appeals to Millennial and Gen Z values is a must for maintaining a competitive edge.

Both these groups are politically and socially aware, caring deeply about climate change and social justice in particular. Deloitte found that three-quarters of Millennials and Gen Z believe the environment is at a tipping point and the future can go either way, but only a small minority (14 percent and 15 percent respectively) believed large corporations are taking substantive action to tackle climate change.

In general, Millennials and Gen Z tend to be technology and value-driven—much more so than previous generations. They demand authenticity, transparency, and genuine interaction from their buying experiences. Merchants that work to meet these demands will reap the benefits of loyal customers whose spending power will only continue to grow.

A New Generation: Meet Generation Alpha

While Gen Z is considered to be digitally native, the generation below them, Generation Alpha – born after 2010, was born into a world where the internet and digital interaction have always been constantly ‘on.’

As the members of this generation are still children, it’s impossible to know if the value that Millennials and Gen Z place on digital experience, social conscience, and social media will continue, or if the following generation will reject these trends. But the immersion in technology, almost from birth, means that this group is guaranteed to have a highly sophisticated understanding of tech and correspondingly high expectations of online retailers.

Kibo Blog

Our Most Recent Blog Posts

Prepare yourself with key insights, guides, datapoints, and more. Subscribe to the Kibo Monthly Newsletter.

View all Blog Posts

worker reviewing data on tablet

What Is Unified Commerce—And Why Is It Essential In 2024 and Beyond?

What are the advantages of unified commerce? How does it compare to omnichannel? And how can a unified platform help you succeed in 2021?

Woman shopping using multiple channels

The Definitive Guide to Omnichannel vs. Multichannel Commerce

As a business, you already know that making your products or services available for purchase across more than one channel is a really good idea. Not only does it allow you to diversify your distribution,…

Forrester Landscape B2C and B2B

Kibo is Listed in Forrester Reports: Commerce Solutions For B2C Landscape, Q4 2023 and Commerce Solutions For B2B Landscape, Q4 2023

In today’s competitive landscape, it’s never been more crucial for companies to choose commerce technologies that fit their unique business needs today and can evolve with them over time. But choosing the right platform is…