Millennials Keep Brick-and-Mortar Retailers on their Toes
Millennials have grown up in a world where screen time is the norm, and commerce is a few taps or clicks away, sometimes without them needing to seek it out. But that doesn’t mean they’ve abandoned brick-and-mortar retail altogether. Retailers may have to work harder to lure millennials in store but the opportunity is definitely there.
Despite the decline in retail, studies show that millennials, now 87 million strong, still go to brick –and-mortar stores. In fact, 50% of millennials say they prefer going to stores (Source: Adweek). This poses both an opportunity and a challenge for retailers that are fighting to keep retail alive and not lose consumers to online giants like Amazon. As a millennial myself, I speak from experience when I say, millennials are not particularly loyal to brands; therefore, retailers need to find creative solutions to lead millennials to in-store purchases.
Retail is changing and adapting almost as quickly as fashion trends. Retail brands must change their strategy in order to keep up with the ever-changing, fast-paced market in which they compete. One area where retailers have been investing money is store location. Millennials are attracted to central locations that offer diverse activities. This generation craves new and trendy locations where they can shop, eat and take post-worthy Instragram photos. These are the locations where businesses, not just retail, can flourish. Retailers are beginning to catch on to this and close underperforming stores that are turning over little profit compared to steep rent costs. This will allow them to invest in higher performing stores and other best practices to engage with experience-driven millennials and defend against showroomers.
“Showroomers” is a term coined for shoppers who test-drive products in store before purchasing them online. These consumers are notorious for trying on or testing products in stores with the famous last words of, “I’ll be back”. We have all been there, let’s be truthful. Some consumers even purchase the item from their smart phone as they are exiting the store. Retailers and marketers need to get smarter by using this information to their advantage. One way this can be done is by opening up pop-up stores and allowing consumers to order their products in store, hands free, and have their items shipped to their house.
Pop-up stores are becoming a widely used strategy for a lot of retailers and marketers alike. The pop-up industry alone has generated $10 billion in sales according to PopUp Republic (Source: Retail TouchPoints).These stores are being developed in a variety of ways from inside brick-and-mortar stores to kiosks. Some pop-up stores are even operated out of motorized vehicles, inspired by the food truck craze that has millennials’ full attention. Consumers are turning to pop-up stores with the expectation that the shopping experience will be unique and specialized. In fact, here are the top five reasons consumers go to pop-up stores:
- Unique services/products (39%)
- Localized assortments (36%)
- Optimal pricing (34%)
- Convenience (33%)
- Fun experience (30%)
Millennials are a generation that has serious FOMO (fear of missing out), believe me. With pop-up stores there is an element of exclusivity that attracts millennials. It’s the concept of here today, gone tomorrow. If brick-and-mortar stores want to stay up-to-date with millennials, they should integrate pop-up stores into their branding and marketing mix. Nordstrom adopted the pop-up trend in 2013 with “Pop-In@Nordstrom”. Pop-In@Nordstrom is a recurring series of in-store sales offering products that you typically can’t find in stores. Here at Cronin, we are thinking about ways to leverage pop-up focus studios as part of our innovation and research process to test new ideas – often as ways to get reactions from millennials.
Traditional brick-and-mortar retail may be declining overall, but millennials are still listening if you can get their selective attention. Retailers and marketers need to constantly be on their toes with this generation of digital multi-taskers that can sometimes be de-sensitized to advertising messages, are not particularly loyal to brands, and carry a tremendous amount of buying power. Through both new and proven strategies – and a lot of tenacity – retailers can lure millennials in store and ultimately to a purchase decision.