New York, NY—New research from Peter Hubbell of BoomAgers, in conjunction with NMI, a strategic consulting, market research and business development company, further explains why the jewelry industry continues to struggle to attract Millennials.
Apart from their well-documented preferences for spending on experiences instead of things, the bottom line is that Millennials simply don’t have the money. While affluent Millennials have been shown to spend as much or more on jewelry than older consumers in the same income strata, Millennials as a whole will come into affluence at a much later age and lifestage than their Boomer parents did and they have less money to spend now than their parents did at the same age and lifestage.
Here are highlights from the new research:
They’re delaying critical life stage choices; some by necessity and others by choice, but it impacts spending down the pipeline. For example, delayed home purchases mean delayed purchases of things for the home. About 30% of Millennial-age Americans are married, compared to 77% of individuals at same age in 1960.
They’re foregoing ownership in favor of sharing. 59% would rather rent than buy a home even if they can afford it. They have a strong affinity for luxury brands, but if they can’t afford to own it, they’re just as happy—if not happier—to borrow it. Hence the rise of services like Rent The Runway or HauteVault that rent out designer clothing and fine jewelry, respectively. Millennials also represent only 28% of auto sales; solutions like Zipcar and Uber have replaced the need to own a car, and vacation options like Air Bnb give an immersion experience at a lower cost than a hotel.
Although Millennials have an affinity for luxury goods, they’re not always brand loyal, particularly when their lower incomes make them more price-sensitive. 62% of Millennials surveyed said value and price would cause them to select a new brand; higher than other selection criteria like recommendation from a friend (55%) and brand reputation (47%).
Millennials are complicated. While it’s common wisdom that they prefer on-line platforms for key activities like shopping, banking, communicating etc., what’s more revealing is their tendencies within these platforms. Think about the power of new generational propensities like the desire for immediate gratification, the expectation of full transparency, and the presence of admirable brand values and ethics. And if all that isn’t complicated enough, Millennials are coming of age in a context of blistering change accelerated by technology. Disruption is the new norm. Once you’ve defined success, get ready to re-define it, and then repeat.
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Image: Peter Hubbell/BoomAgers