Retail Shouldn't Ditch the Store Because Millennials Love It
OK, like everyone else I sort of assumed that Millennials have completely abandoned brick-and-mortar and only shop via Amazon while buying a latte at Starbucks via an app. After all, we are in a cashless society, dominated by web retailers and tech-savvy consumers, right? Who needs a store anymore?
Fascinating story from CNBC. Millennials are actually hitting the stores looking for bargains and comparison shopping while out-and-about.
Millennials could be playing a bigger role in keeping physical retail alive than one might think.
And though it may seem counterintuitive, baby boomers are more and more loving looking for deals online.
Seventy-one percent of millennials are visiting multiple stores in search of bargains, compared with 57 percent of baby boomers, according to First Insight, a technology company that helps retailers select the optimal price for their products.
"The retail industry has been operating on the outdated assumption that boomers are shopping for deals primarily in-store and millennials are searching for deals mostly online," said Greg Petro, CEO of First Insight.
"The behavior between these generations is evolving, and to benefit, retailers must recalibrate their approach to marketing, inventory and pricing to attract deal-seekers who may have been overlooked based on outdated perceptions," Petro explained....
"Baby boomers are technologically aware, while millennials are tech natives," Petro told CNBC in an interview. Both categories of shoppers are looking at deals online today, but First Insight has found that "how they execute" is surprisingly different.
"Millennials are going out [for] the treasure hunting experience in stores," Petro added. "Baby boomers — growing up — have already experienced this. ... Basically, what this suggests is not to ignore the store environment because millennials are still seeking it out."
Maybe the "death of retail" stories are a little overblown?
At Prudent Growth we love retail - as long as it consists of neighborhood retail centers, unanchored by a big-box, with a pleasant mix of services, products, and offices. Think about your neighborhood GreatClips, nail salon, take-out joint, fitness center, urgent care clinic. Is Amazon really going to eliminate those guys in the foreseeable future? I doubt it.
Yes, there is going to be an interesting shift over the next several decades into exciting new ways to shop and obtain services, but - like the assumptions regarding millennials and boomers that this survey turned on their head - there are still excellent investments out there to be made!