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Engaging Millennials online


With the surge in smartphone and tablet purchases in recent years, and the increasing accessibility of Wi-Fi, there is no surprise that almost 70% of consumers are now shopping online as well as in stores. Among those leading the trend are millennials (ages 18–33) making $75,000 or more a year.

According to the Shullman Research Center’s Luxury and Affluence Monthly Pulse, millennials making $75,000 or more are more likely to spend money on luxury goods when compared to the two older generations — Generation X, now age 34 to 48; and Baby Boomers, ages 49 to 67. Saddled with large amounts of student loan debt and a difficult job market, millennials must make very strategic decisions on how to spend their money. To understand how best to sell to millennials, you have to understand their shopping behavior and the best places to engage with them. Through our research, we have found that millennials are engaging with brands online through social media and constantly telling their friends about what they find. Other trends found to influence buying decisions include:

  • Showrooming and webrooming

  • Engagement through multiple platforms

  • Discounted items by at least 30%

  • Unique customization of products

  • Rich, detailed content

  • Strong loyalty programs

A known trend among millennials is showrooming, or using physical stores for browsing and websites for purchasing the goods inspected in person. While 63% of millennial consumers engage in showrooming according to a recent study by Accenture, another new trend called webrooming, or purchasing an item in a physical store after conducting research about it online, is popular among 65% of millennial shoppers. For the first time, webrooming has surpassed showrooming as the most prominent shopping trend among consumers and millennials. However, no matter which trend a potential millennial customer plans to participate in when making purchasing decisions, retailers and ecommerce sites must engage them online to increase their overall customer experience, and ultimately their loyalty with the brand. As a way to develop brand loyalty with millennials, modern retailers must offer deeper engagement, faster service, a faultless experience and consistent rewards.

In an effort to cater to millennials’ mindset of getting what they want, when they want it, Rakuten implements “omotenashi,”a Japanese word used to depict a mindset of service and hospitality that is not as common among western retailers. The omotenashi philosophy is aimed at helping merchants create lasting relationships with customers through ‘discovery’ shopping, online video content and reviews. By becoming a trusted resource and focusing on discovery shopping, whereby you introduce your customer to products and items they may never have otherwise found, you will build a long-lasting relationship with them that goes far beyond a one-time sale. By meeting the consumer on multiple platforms (online, smartphones, tablets, social media), Rakuten is able to create an environment that is the opposite of most faceless, transactional marketplaces, and offer more than 17 million products from 6,700 merchants in 24 product categories.

While many may argue that discounting your product takes away from the value of your offerings, according to Accenture, 62% of millennial customers said that it would take a discount of 30% or more to persuade them to make a purchase. Additionally, 39% of respondents were cited saying that if an item they bought was later offered at a lower price, they would likely return it and rebuy it.

When addressing the problem of staying competitive at full price, retailers have to make every attempt to embrace customization as a key area for strategic growth. To be successful in this area, customization must be made a priority for every area of the business, from sales to IT. Failure to do so will result in an inconsistent experience for customers, and ultimately negate loyalty towards the brand. Among millennials, customization is highly important and arguably the most important thing affecting their purchasing decisions.

Further adding to the ways to engage millennials online and create an impeccable experience, retailers must take the conversation to millennials via social media. Rich, detailed content is increasingly important — not just when showcasing products and driving sales but also to give consumers a reason to keep coming back to you. If you provide all of the information a potential customer needs, as well as valuable opinion about trends and purchasing decisions, a customer is going to come straight back to you next time they are searching for inspiration. Make sure the additional content is easily seen and even more easily shared; consider adding share buttons to your posts and use additional social media channels, such as Twitter, Pinterest, Tumblr or Facebook to ensure you reach as many pairs of eyes as possible. It is important to remember that your customers want to know what others are buying, what’s trending, and what is going to make them stand out from the crowd. According to research published by Vision Critical, Pinterest is the network most likely to drive spontaneous purchasing. In comparison to larger social networks, Pinterest offers a visually, aesthetically pleasing user experience that, when coupled with the right product imagery, can provide a sizeable return, particularly among tablet users. If retailers want a bigger piece of social sales, then they have to be willing to connect with millennials where they are — social media.

As a way of saying “thank you” to customers and gamifying the shopping experience for millennials, retailers can offer a strong loyalty program to entice customers to make more purchases with the brand. We have a Rakuten Super Points program that rewards shoppers with every purchase. Customers can accumulate points in exchange for free offers and gifts or discounted purchases. Rakuten lets the customer decide how they want to use their points at any time. Remaining balances for item can then be purchased with various payment methods to complete the transaction. Among millennials, we have seen amazing success with the program. Millennials love that they can earn points buying things they love, and then use those points to buy other items that they love even more.

Research shows that online shopping is here to stay and retailers need to make the necessary adjustments to captivate this growing audience. With millennials leading the pack, retailers have to overcome the unique challenges of engaging an audience and turn them into reoccurring customers. Ultimately, every customer has to be treated as an individual with the option of buying unique, personal items whenever they want. Through deep engagements, fast service, personalized experiences, and consistent rewards, millennials will become brand ambassadors of your brand, and life-long loyal members.

Bernard Luthi is CMO and COO of Shopping. He has 15 years of experience in e-commerce, technology and consumer electronics. He leads marketing initiatives in Web, advertising, BuyTV, public relations and promotion, and works closely with Rakuten on overall corporate branding.

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