As millennials and Gen Z shoppers shape the future of retail, contributor Davor Sutija explains why brands need to embrace technologies that will help them keep pace and bridge the digital gap.
The very concept of how people buy has fundamentally changed, due to the emergence of digital platforms like search engines, online reviews, social media and e-commerce marketplaces. This new online landscape has led to a rapidly expanding gap between consumers and the brands they shop for.
To better understand this widening disconnect, we first need to examine the core of this shift in shopping: a change in the consumer profile. Mobile-conscious digital natives, particularly millennials and Generation Z shoppers, are becoming the trendsetters and tastemakers in our society.
Not only has Pew Research reported that millennials have surpassed other generations — even baby boomers — in total numbers, but they also spend about $600 billion a year in the US, according to Accenture. “Gen BuY” authors Kit Yarrow and Jayne O’Donnell say millennial, or Generation Y, shoppers spend 25 percent to 40 percent more than the average consumer and will spend $10 trillion in their lifetimes.
Digital platforms reshaping retail
This collective buying power demands that brands and agencies adapt to the shopping preferences of millennials and members of Gen Z or run the risk of being left behind, as digitally savvy consumers are disconnected from brands when they turn to digital platforms. Consumers now say, “I’ll Google it,” or “I’ll buy it on Amazon” when they talk about products, establishing platform loyalty instead of brand loyalty.
There’s no better proof of this than the current conversation going on in the retail world over the impact of Amazon. Much of this conversation focuses on the issue of competition between brick-and-mortar retail stores and the e-commerce giant; take the showdown happening with Walmart now, for example.
The change in how consumers become informed and make purchase decisions is ultimately leaving brands out of the conversation — and out of the minds of the buying population.
Source: Marketing Land