For a number of businesses, dealing with mainly Millennial customers has been the norm for the last decade, but this is changing. While Millennials have dominated the consumer landscape due to their significant purchasing power, Gen Z consumers are now demanding more attention from businesses as their spending power has increased. Let's take a look at how you can get ahead of the curve and turn both Millennials and Gen Z into loyal brand advocates.
1. Have an omnichannel presence
There is a popular concern about brick and mortar stores' slow death due to the rise of online shopping. However, recent studies have shown that this isn't the case for Millennials and Gen Z consumers. Physical stores still remain a prominent channel for purchases, although consumers' preferences have gravitated towards an omnichannel presence. This means that Millennials and Gen Z are more likely to engage with a brand across multiple channels before purchasing. Whether it is browsing your website to check availability of a product or service or visiting your social media to read reviews and seek support, customers are now taking a more active approach before making a purchase.
To win these shoppers' loyalty, you must do more than just having an omnichannel approach. A study by IBM showed that Gen Z spends 43% time online connecting with other people, which implies that building connections is an important factor to keep in mind. By offering seamless integration and consistent messages across digital and physical channels, you can build long-term relationships with customers.
When investing in a loyalty program, consider one that incentivizes interaction across all your channels. This can help drive Millennials and Gen Z customers to engage more with your business, thus boosting loyalty. For example, Starbucks rewards - the most enrolled loyalty program for Gen Z consumers - does not offer online orders. Instead, it offers the ability to order in advance, pay via mobile and collect in-store to earn points. This gives an incentive for customers to engage both online and in-store with the business.
2. Offer personalized interactions
Personalized interactions is one of the biggest trends in recent years with no sign of stopping. When it comes to interacting with a business, Millennials and Gen Z consumers are looking for more personalized experiences that are meaningful to them. Salesforce’s Shopper-First Retailing report revealed that 68% of Millennials and Gen Z shoppers prefer retailers to provide recommendations based on their purchasing history. The hidden marketing opportunities that lie within personalization now abound: while only 6% of digital shoppers click product recommendations, they account for 37% of revenue.
However, while there's no doubt personalization helps marketers break through the clutter during promotion stage, it is not the sole domain of marketing. Cross-functional teams in different lines of business such as IT, operations and management must collaborate to create experiences that are both compelling and personal to customers. How then, does this personalization work across customer touchpoints?
To increase personalized interactions, you can leverage solutions that allow you to collect customer data across channels. Then, implement tactics like machine learning and predictive analysis to predict customers’ future behavior, or use this data to identify your customers' needs and wants to deliver a more personalized experience. Keep in mind that while 75% of Gen Z and Millennials are willing to share personal information with a brand in exchange for a more personalized experience, it does not mean that privacy does not matter to them. It is important that you also consider strategies to protect customer privacy in order to foster trust and transparency..
3. Provide experiences over transactions
Millennials are said to favor experiences over possessions, and this also carries on to Gen Z. 78% of Millennials would rather spend money on an experience or event over buying a physical product. This means that businesses must focus on more than just immediate sales and customer acquisition but rather dive deep into the consumer experience to increase customer loyalty. With the rise of global connectivity, Millennials and Gen Z consumers are accustomed to speed, efficiency, accessibility, and community. Therefore, it is important to consider if your business is offering experiences that deliver these benefits and solve customer pains at every touchpoint.
With these increasing expectations comes an exciting time for brands to provide meaningful experiences for customers, especially at in-store touchpoints. To increase customer loyalty, look at how you can leverage technology. The right technology can support a more seamless customer/brand interaction by allowing you to understand in-depth what most motivates your customers. This will help provide insights you can use to deliver an exceptional, tailored customer experience.
Businesses have long realized the gains that can be made through targeting and engaging with Millennial consumers. Now, success lies in thinking ahead and catering to your most loyal consumers of the future, Millennials and Gen Z.