Gen Y Considerations For The Retail Industry In Australia

Gen Y Considerations for the Retail Industry in Australia
By Simone Daniels (2007) Generation Y (Gen Y), also referred to as Echo Boomers, Millennials千禧一代, the Internet Generation, or Nexters, is the cohort一隊人 born between the years of 1977 and 1994. As a significant proportion比例 of today’s consumers, Gen Ys offer the retail industry one of its greatest growth opportunities whilst simultaneously同時 acting as one of its greatest challenges. The acknowledgement and exploration探索 of Gen Ys have undoubtedly been stimulated by the fact that 5.5 million Australians now fall into this category, representing approximately 25 percent of our population. By the year 2015, Gen Ys will become the most significant retail spending group in Australia (Jones, 2003). Gen Y shopping patterns and behaviour
As a notoriously惡名昭彰地fickle善變的consumer segment, Gen Ys characteristically demand the latest trends in record time and, as such, are turning the shopping experience upside down (McLean, 2004). According to Bakewell and Mitchell (2003), the Y Generation has been subjected to more targeted marketing programmes and has been brought up with more retailing formats and product/brand choices than any other generation. Gen Ys have also been acculturated因文化傳入而變化 into an environment that provides more opportunities and reasons to shop than ever before (Bakewell & Mitchell, 2003). The introduction of Sunday shopping and extended weekly trading hours are prime examples of this. As consumers, Gen Ys are independent, non-traditional and sophisticated, brand and fashion conscious, but not necessarily brand loyal忠實品牌擁 (McLean, 2004).These consumers also have a wide-reaching social具有廣泛影響network that influences their buying decisions. Such vast巨大的networks are fundamentally根本上changing the way in which they shop. Word-of-mouth口碑influence no longer comes at a party or family gathering, but from a wide swath of members of their greater online network (Waters, 2006).

Gen Ys have also been raised in an era時代where shopping is not regarded as a simple act of purchasing. For example, according to a study conducted by Dias (2003), most Gen Ys are inclined傾向於to shop with friends, spend more time browsing through stores and chatting, ultimately最終treating注入 the experience as a social activity. It is important to note, however, that the shopping patterns of Gen Ys continue to be a work in progress進展. Many purchasing habits and shopping trends are only now being determined as the older members of the cohort enter their adult years (Jones, 2005). They are also using different approaches in making choices compared to previous generations (Bakewell & Mitchell, 2003). In order to capture the elusive難以捉摸 Gen Ys, retailers need to understand and thereby cater迎合 to their unique decision-making styles and consumption patterns. Gen Y spending habits
Gen Y is fast emerging新興的 as a spending phenomenon that is quickly overshadowing the much smaller and often-forgotten Generation X (Jones, 2006). Simply put, Gen Ys are cashed up and willing to spend. In fact, they possess more than half of Australia’s discretionary無條件的spending power (Smith, 2006). Having entered part-time or casual employment throughout secondary school and opting to remain living at home for longer, Gen Ys are an attractive and lucrative利潤豐厚market, especially given that they spend most, if not all, of their income (Dower,
2005).

The possession擁有of money and thereby the ability to purchase more can arguably可以認為be attributed to environmental factors, such as the increasing ownership of credit cards amongst Gen Ys. This is evidenced by the steady increase both in the availability of credit cards marketed to young adults (e.g. Virgin Money’s credit cards are available in a multitude of trendy colours on a silk background) and the rise in the number of retailers introducing their own store cards with interest-free periods (Bakewell & Mitchell, 2003). In addition, due to the sheer amount of disposable可支配income Gen Ys possess, marketers have made Gen Ys more aware of their own purchasing and spending power. Consequently, Gen Ys are likely to spend their cash as quickly as they acquire it. The significance for retail organisations lies in their physical outlets, which act as a common gathering place for Gen Y consumers and are, therefore, often the beneficiaries of a substantial portion of their money spent (Martin & Turley, 2004). Implications啟示for the retail industry
The retail industry must proactively積極consider the characteristics, shopping patterns and spending habits of Gen Ys when marketing to and interacting with them. This will allow retailers to create an environment conducive to gaining their trust and increased loyalty. The most significant implication for retailers is to establish relationships with Gen Ys today, as children, teens and young adults, and then leverage those as the generation moves through successive life stages. Retailers need to be aware that approaching Gen Ys with retail strategies and tactics designed for earlier generations is a recipe for failure. Gen Ys are a unique generation, brought up with different values and new priorities. They are a very difficult group of consumers to reach because they are well-educated, inquisitive and marketing savvy (Turk,
2006). It is important for retailers to remember that for Gen Ys, instant gratification and getting what they want are what spending is ultimately about. For marketers and communicators in a retail environment, this creates implications for the way in which strategies are developed and implemented. First, flexibility is vital. Faced with a generation whose buying patterns may shift quickly and continually, retailers need to develop and maintain flexible strategies that are responsive to constant change. With retail concepts hot today and not tomorrow, retailers also need to be thinking about building long-term relationships with Gen Y clientele today (Sokol, 2003). For Gen Ys, there exists little reliance on mainstream media; rather, word-of-mouth is the most powerful promotional tool. For example, clothing companies now increasingly hire car parks and warehouses to hold one-off, end-of-season clearances. Such sales receive high levels of foot traffic although they are never advertised in mainstream media. Rather, word is spread via flyers, websites and online blogs (Smith, 2006). As a critical consumer group, Gen Ys do not like hard-sell tactics, and they despise traditional advertising. It is important to maintain ‘edginess’ with key messages and minimise the generic formula for advertising. Celebrity testimonials, loud and quick visuals, and advertisements that reflect the Gen Y lifestyle and core values in humorous and emotional ways will appeal to Y Generation consumers (Morton, 2002). The intersection of e-commerce with Gen Y’s technological comfort and skill levels can potentially create a challenge for retail organisations. This is reflected by the fact that the number of online purchases, primarily for female apparel, is continually growing. Retailers should also be aware that Gen Y consumers are far more comfortable shopping online if an avenue exists to return merchandise to a ‘bricks and mortar’ store (Jones, 2003). A study undertaken by Jones (2003) on Gen Ys and the future of Australian retailing revealed additional implications for retailers. The findings suggest that retailers will have to change with, or even anticipate the changing needs and preferences of Gen Ys to remain competitive.
For retail marketers, the time available to shape buying demand is much shorter than that in the past since Gen Ys, from an early age, have been immersed in a materialistic and consumer culture. In the process, members have learned to expertly filter out “noise” and are increasingly sceptical about much of the information directed at them.

There also exists a consistent and ongoing need to segment the population of Gen Y consumers in ways that acknowledge and address the fact that this segment currently ranges in age from 12–29 years of age. This will allow for marketing programmes to be customised accordingly. In addition, Gen Y merchandise needs to be ever-evolving to appeal to a generation that thrives on change. However, change should not appear to be made merely for the sake of change, or retailers may run the risk of being deemed untrustworthy. Retailers need to deliver to their customers’ expectations, even as those expectations are constantly evolving. The ultimate implication is that retailers will have to learn to be more comfortable with increased levels of risk and uncertainty, expecting that their best-intentioned plans or strategies may need to be amended or even scrapped to suit and adapt to the changing nature of Gen Ys. Ultimately, today’s most creative strategy, tactic or approach for marketing and retailing to
Gen Ys will inevitably need to be revitalised tomorrow and replaced the day after. Retail organisations that prove to be most able, adaptable and agile in breaking into the world of
Gen Ys - capturing their true essence - will be the ones most likely to succeed in the competition for future customers and profits.