Millennials and Their Spending Habits: How It’s Shaping the World
Millennials, also known as Generation Y, the 80’s and 90’s kid or those born between 1980 and 2000 are slowly changing the world economy as we see it today. By far the largest generation comprising of more than 70 million individuals in the United States, overtaking the population of baby boomers, Millennials are the most influential and promising group in shaping the modern world.
Their influence felt in areas such as science, math, and arts is redefining various industries, creating waves of change, and breaking ‘traditional ways’ to cater their new way of thinking and ideologies.
Having been raised during the time of rapid technological growth, Millennials have the most influence over old generations and are considered the biggest trendsetters of our world today. Despite being career-driven, skilled, and highly educated, Millennials are often considered financially doomed and unstable.
Graduating and going into adulthood during the economic recession, Millennials spending habits are affecting the economy in large measures especially in areas of marketing, finance and technology.
The Death of Ads
Decades ago all you need to do was pour your money into advertising and your brand is setup for success. However, today, this isn’t the case anymore. Millennials and their incessant craving for authenticity have come to understand how sneaky advertisements can be. More often than not, messages used by advertisers are known to trigger emotional rather than rational responses among consumers.
It’s no wonder Millennials don’t trust commercials, and are often the ones who avoid and despise adverts in Facebook and other websites. Although, not generalizing, a baby boomer might fall prey to adverts masquerading as good deals all over the media, but a millennial will be wiser and will know even in just one look which advert is authentic or not. This is not only making advertising a lot harder for companies, it’s also making them reevaluate their traditional marketing methods.
Brands and Social Media
It should also come as no surprise that Millennials prefer brands that interact with consumers on digital channels. Nowadays, it’s almost customary for brands to have their own Facebook and Twitter pages. Millennials want brands to be participative in terms of their experience. They want to engage with brands to learn more about the products.
The thing is: Millennials value authenticity. Content is good, but lack of authenticity may lead them to draw back from trusting a company or a site. They want blogs that connect with people. This is why social media is as much a growing industry today more than it was decades ago.
The Rise of Online Shopping
The traditional way of shopping is slowly becoming a thing of the past. The convenience of online stores is drawing Millennials and making it hard for in-store retailers to keep up with their digital competitors.
Millennials are so fond of purchasing online; they would gladly wait a few days to get their order delivered, than to march on to the nearest mall or supermarket. Online shopping also allows them to be selective and be able to review their options wisely.
Renting vs Owning a House
The fall of economy has made a major impact on Millennials, many of whom are still having a hard time paying off their student loans, living with their parents, or are currently underemployed. This makes renting homes a far better option to this generation.
Millennials who are now in their early 20’s or 30’s are on the phase where they’d like to get married and start a family. However, they can’t afford to both start a family and own a house at the same time. Traveling which is a common millennial dream prevents them to settle down and buy a house of their own. All this makes renting a far better option than owning a house. .
Growth of the Sharing Economy
Much of the sharing economy’s growth can be attributed to the Millennials. Millennials find the sharing practice not only thrifty, it’s also a great way to reduce consumption and space in the world. Think about it, why would you need to buy a house if you’re going to travel all the time? Why would you buy a nice ride, if you can ride one for a cheaper option?
James O’Connell, CEO of JDP, explains this behavior of Millennials from a mental standpoint.
He says, “Millennials believe in making a difference with their spending habits… Companies like Uber and Airbnb are doing so well because their business plan taps into that mindset so completely.”
Brands and Their Positive Impact in the World
By nature, Millennials are inherently cosmopolitan. Growing up on the period of globalization and boom of technology, they are more attuned and interested to global issues. Thus, they also love to view their purchases through a global lens. In a recent study, Millennials were found to purchase more environmentally or socially responsible products and love to donate their money and time on charity.
Brands have to give back something to society. At least that’s how Millennials believes it should be. Millennials are tired of corporate greed, after the world’s recovery of one of its largest financial crisis – they want to see more sharing and giving.
Through their unique but progressive ways, Millennials are preparing the world for the future. Everyone has their own opinions about this generation – but one thing is for sure: they are calling the shots now and the world will just have to listen.
Featured photo credit: Bench Accountingvia unsplash.com
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