In the summer of 2011, a collaborative study between loyalty management firm AIMIA and research firm Harris Interactive was conducted. The study focused on brand loyalty among consumers aged 19-29 in Canada, the United Kingdom and United States. The resulting report included results of a survey of 1147 millenials and 1135 non-millenials and data from a 2010 Pew Research Center study. What follows are some of the findings about US millenials:
- The millenial market includes 77 million US citizens.
- 55% watch their spending “very closely” and 77% worry that they are not saving enough.
- Ethnicity is more diverse in the millennial generation: 61% are Caucasian compared to 71% of non-millenials.
- 9% earn over $100,000 while 62% earn less than $50,000. Pew estimates millenials contribute $600 billion out of the $6.5 trillion consumer dollars spent each year.
- Millenial loyalty is driven by quality and value.
- 74% of millenials are likely to act more loyal to and share their feelings about a brand offering a loyalty program – numbers roughly equal to non-millenials.
- 57% use mobile devices to compare prices while in-store.
- Quality is determined within social context. 58% read product reviews prior to purchase.
- Social networks are not the driving influence on purchase decisions. Only 24% check Facebook or Twitter for recommendations prior to purchase.
- 77% claim participation in loyalty and reward programs. This is slightly lower than non-millenials at 82%.
- 78% are likely to choose a brand that offers a loyalty or rewards program over one that has no program.
- Loyalty rewards are rated as the top incentive that can be offered in order to receive personal information.
- 44% are willing to promote a product or brand through social media in exchange for rewards.
- 26% show interest in using a mobile device as a substitute for a printed loyalty card.
- They are less concerned than non-millenials about data privacy and overall personal data security. When given a number of marketing channels to choose from, loyalty and reward programs are perceived as the most privacy-friendly.
- 47% are more likely to share personal details with a brand offering loyalty incentives.
- 78% expect to earn a reward within the first three months of entry into a loyalty program, a significantly higher number than non-millenials.
- 74% would be interested in a collaborative reward program among multiple companies which offered a common ‘currency’.
- Most define themselves by their relationship with technology.
The researchers offered four pieces of “wisdom” that came out of the study:
- Demonstrate Immediate Value. Construct a loyalty program that allows for rewards within 30 days.
- Extract Maximum Efficiency from a Loyalty Program. Construct pricing and rewards carefully by using “rewards optimization tools, dynamic market segmentation techniques and focused attrition models”.
- Seek Out New Definitions of Customer Value. Identify the real influencers, connect those values to your products, and use your customers’ voice to convey your message.
- Use Technology as a Means, not an End. Use mobile technology as a way to connect with your customers, but don’t simply convey one-way messages. Millenials see technology as a means to enrich their lives, not act as a “dumb terminal” waiting to receive marketing messages.
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