Consumer Behavior

How AI Technology Can Help You Reach Today’s Millennial Shopper

There are endless factors that impact e-commerce, but there’s no doubt as to which generation drives online shopping: Millennials. The shift to online shopping during 2020 has impacted every age demographic and every industry in America. And while Gen Xers spend a ton of money online and Gen Zers spend the most in categories like apparel and food delivery, Millennials reign supreme in spending across essential and non-essential categories. As a result, understanding Millennial consumer behavior is critical for the health and success of every online retailer.

Consumer Behavior

How AI Technology Can Help You Reach Today’s Millennial Shopper

There are endless factors that impact e-commerce, but there’s no doubt as to which generation drives online shopping: Millennials. The shift to online shopping during 2020 has impacted every age demographic and every industry in America. And while Gen Xers spend a ton of money online and Gen Zers spend the most in categories like apparel and food delivery, Millennials reign supreme in spending across essential and non-essential categories. As a result, understanding Millennial consumer behavior is critical for the health and success of every online retailer.

Generation Spend

Millennials are now the largest generation in America with 72.1 million individuals accounting for about 22% of the total U.S. population. Despite the wide age gap among those tens of millions of people, data shows that millennial consumer behavior still follows certain patterns — especially when it comes to online shopping.

To start, around 86% of all Millennials made any online purchase in 2020, and six out of 10 do the majority of their shopping online. Around 60% of millennials reported using a mobile retail app to research products and make purchases, which makes sense given that Millennials are the biggest social media users of any age group and are among the strongest adaptors to innovations like mobile payments. Nearly 70% of millennials say they have used a smartphone to make a payment in a brick-and-mortar store, and the same percentage say they prefer using their device to redeem coupons and rebates. Meanwhile a quarter of people between ages 24–40 have made the switch to a mobile wallet for all their shopping — and they cite checkout speed as the No. 1  factor for making that switch.


One of the hallmarks of Millennial consumer behavior is how the generation chooses where to shop. Millennials prioritize brands that are values-oriented and rate highly in terms of authenticity and engagement with social and environmental issues. However, millennials are the most impulsive online shoppers — 80% say they will purchase a product the first time they see it if they like it enough. Moreover, Millennials list fast shipping and more product options as the top  reason for shopping online, followed closely by the convenience of shopping from home and the ability to see other’s reviews online.


Given that the median retailer earns 30% of their sales from Millennial consumers and that the generation, as a whole, spent an estimated $1.4 trillion dollars shopping online in 2020, every business needs to devise a strategy that will attract and retain the shoppers with the most purchasing power in 2021 — and for years to come.


Data-Driven Strategies

Even with a good grasp of Millennial consumer behavior, that knowledge is useless without applying it to a data-driven marketing strategy. Lily AI can help your business leverage machine learning and AI technology to meet Millennials where they are and design a digital experience that appeals to their individual preferences. The key? Not all millennials are the same. Each one comes to the table with individual preferences and emotions that attracts them to certain products over others.


Lily AI works to understand the emotional context of each shopper — and for a generation that buys impulsively and shops from anywhere on their mobile devices, using this information to create deeply personalized experiences can be the difference between a sale and signing off. We use cutting-edge technology to enhance your products tags and analyze customer behavior, creating comprehensive consumer profiles to dig beyond surface-level data and present a more clear picture of what drives each individual customer through their purchasing journey. 


In the world of e-commerce, Millennials are at the top of the food chain and will continue to dominate the market for the next decade. Contact Lily AI now and learn how our innovative solutions will help deliver personalized experiences that keep customers engaged.



References

https://www.pewresearch.org/fact-tank/2020/04/28/millennials-overtake-baby-boomers-as-americas-largest-generation/ 

https://www.brookings.edu/blog/the-avenue/2020/07/30/now-more-than-half-of-americans-are-millennials-or-younger/ 

https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/the-great-consumer-shift-ten-charts-that-show-how-us-shopping-behavior-is-changing 

https://www.emarketer.com/content/how-digital-are-millennials-in-their-shopping 

https://www.gcimagazine.com/marketstrends/consumers/Consumer-Culture-Report-Identifies-Millennial-Shopping-Habits-for-2020-566951181.html 

https://www.bcg.com/publications/2020/how-marketers-can-win-with-gen-z-millennials-post-covid

https://www.junglescout.com/blog/millennial-shopping-habits/