Making retail work for every generation - not just millennials
By Bob Feher,analyst relations and market intelligence, NCR Corp.
Many retailers today seem fixated on introducing new technologies to appeal to the millennial consumer. millennials — those born between the mid- 80's and 2000 — are now the largest group in the workforce and, according to a recent study from Accenture, are expected to spend $1.4 trillion in the U.S. by 2020.
With millennials making up approximately 30 percent of the population, retailers strive to tailor all their efforts to reel in this group, yet often overlook the remaining 70 percent. The millennial generation may be driving retailers to keep up with their tech savvy speed and connectivity, but retailers must build an environment that works for all generations.
In order to keep up with millennial demands, retailers have shifted towards a fast and efficient customer experience. Across all platforms — in-store, mobile and online — retailers focus on entertaining millennials by making their brand most appealing from a fast and digital perspective. The unintended consequence of this approach is alienating other customers that may perceive this experience as rushed and unattractive, taking their business elsewhere.
While millennials represent a sizeable amount of shoppers today, concentrating all efforts on them can cause retailers to miss out on key customers who have a passion to shop and willingness to spend. There is no ‘one-size fits all' approach to reach all generations, however retailers must bring a more diverse attitude to build a system that works for everyone.
Defining today's retail consumer
According to research firm IDC, a majority of U.S. shoppers using digital platforms have a wide range of technical expertise. These consumers fall into four categories:
- Equipped and ready (10 percent); majority under 45 years-old and early adopters, promoters and power users.
- Equipped and unsure (30 percent): underutilizing digital assets, adopt a lot of technology, but require long lasting value proposition and great customer experience.
- Varied experience (50 percent): both over and under 45 years-old, have variable levels of tech ownership.
- Generally interested (10 percent): over 45-years old, lack tech independence.
As communication preferences, media and technology skills constantly change, retailers must become aware of these generational differences and create a desirable customer experience for all. Whether, it's online, mobile or in-store purchasing, customers strive for a sense comfortability, ease of use, and convenience around their purchase decision making. Retailers that develop unique solutions to satisfy these different customer experiences will benefit from a greater customer loyalty.
The right mix of tools
No matter the generation, consumers will remain loyal to a retailer based on the type of experience they have visiting a store. As retailers must compete with the growing e-commerce market, they have begun installing new technologies that focus on developing a unique in-store experience.
As retailers cater to millennials with mobile apps, digital coupons or social media promotions, these technologies can seem daunting to those varied experience shoppers. While those quick and easy solutions are great for the equipped and ready consumer, there remains an opportunity to connect with the customer base that is not yet ready to fully adopt these technologies. As a result, offering the right mix of solutions at stores creates a diverse and all-encompassing experience, bringing in repeat customers.
How to bridge the divide
Retailers are now taking steps to shift their efforts to accommodate all generations with a special focus on the Baby Boomers who tend to be less tech-savvy than millennials. One tactic retailers are using is implementing smaller store layouts to help reduce customer confusion and anxiety levels when shopping. Also, to ensure customer satisfaction, retailers provide an assortment of product options to avoid confusion with site-to-store shopping. Reader-friendly digital signage is also being implemented in stores to help older customers adapt and easily navigate the space. In-store kiosks are positioned throughout stores to help customers order desired products or explore other options that may not be in-store.
Giving staff members the tools to better serve customers in a more relaxed fashion helps ensure that retailers meet consumer needs without compromising those for whom speed is their number one priority. For instance, equipping staff with mobile POS solutions and providing the training to use them effectively can go a long way toward helping customers.
Looking to the future
While efforts to appeal to the older generations continue, retailers must begin to gear up for Generation Z and their increasing interest in social media and digital devices. On average, Gen Z uses their smartphones 15.4 hours per week — more than any other type of device. They shop about eight to nine times per month and prefer mobile payment options. The younger generation thrives on social media and brand engagement on these platforms. Retailers are recognizing and adjusting accordingly to reach this generation on social channels and digital devices.
As retailers continue to make adjustments to consumer behavior, it is important that they incorporate products and services tailored to all generational needs. While millennials demand a speedy, innovative customer experience, solely focusing on these consumer demands could come at the cost of alienating many key customers. The most effective retail operations are those that recognize the diverse needs and preferences of their shoppers, and work hard to make sure they're offering the right solutions for everybody.
Companies: NCR Corporation