How Generational Differences Affect Purchase Behavior
People’s age and the generation to which they belong can offer a lot of insight about their attitude, outlook, and experiences. It also says a lot about their buying behavior.
A recent report by the National Retail Federation surveyed consumers from four generations to see how those generational influences affect how they purchase products.
Of course, some differences in purchase behavior can be attributed to life stage and income: a 25-year-old single professional is going to need to purchase a very different set of items than a 65-year-old retired grandparent.
But what this study highlights is how 25-year-old millennials and 65-year-old baby boomers search for products, how they want to buy a product, and what they expect from the companies with which they do business.
If you own or manage a business, it’s important to understand what different people expect from a purchase experience. And looking at generational tendencies is one piece of information that can help shape your strategy for catering to your consumers — whether you run a coffee shop that appeals to millennials or a grocery store that caters to all age groups.
Before we dive into the report, here’s how we’re defining each generation:
- Millennials are ages 18 to 35
- Generation Xers are 36 to 51
- Baby boomers are 52 to 70
- The Silent Generation is 71 and older
And here are some highlights from the study:
Everyone is jumping on mobile.
Consumers from all generations are starting to make more purchases on smartphones and tablets through browsers and apps (although younger generations make up the bulk of online shoppers). But that doesn’t mean that in-store experiences aren’t just as important.
It would make sense if millennials did everything — including all their shopping — on their phones, but even they value the in-store shopping experience. And they’re not alone.
Seventy-five percent of all generations want to see a product in store. Millennials and Gen Xers are pressed for time, though, and they’re balancing a lot in their lives, so both groups want a tech option and fast checkout.
Loyalty doesn’t always mean the same thing.
When it comes to expressing loyalty, baby boomers and the Silent Generation are more likely to shop at one location. Millennials and Gen Xers are more likely to seek out a specific brand.
If your store carries a variety of brands — and your customer base is made up of the 18-to-51 set — you might do some research on which brands your customers care most about. Or just check your sales data and analytics to see the best-selling brands and products.
It’s important to note, though, that every generation is receptive to loyalty and rewards programs. While your messaging to each group might not be the same, this is a marketing strategy that appeals to all your customers.
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Millennials and Gen Xers expect very different things from messaging.
When asked about the things that influence their purchase decisions, millennials over-indexed for 12 different factors including friends and family recommendations, in-store experience, and even their moods. The next generation closest in age only over-indexed for four factors: review, atmosphere, tech, and speed.
This data highlights a key difference between the two generations. Millennials want to feel emotionally connected to the purchase experience and, often, the brand itself. This means that your business needs to relate with them on a personal level. Gen Xers, on the other hand, want companies to deliver straightforward messaging about why they need to buy what’s being sold.
Younger generations are in a hurry.
But both Gen Xers and millennials are pressed for time (they’re at the peak of their careers and many have young families), so speedy shopping is key. Both groups said that a fast checkout experience is an important factor in their purchase decision.
Older generations are value hunters.
Baby boomers and the Silent Generation aren’t as pressed for time as their younger counterparts, but they are focused on value for their money and product quality. These groups also prioritize products that are reliable, fairly priced, and budget friendly.
You can appeal to these groups with messaging that focuses on product craftsmanship, reliability, and guarantees; tell them why the items are worthwhile buys.
Great customer service is a must.
Every generation relates to brands differently, and they have varying objectives when it comes to the shopping and buying experience. But despite their differences, every generation said payment security (89 percent), easy brand interactions (76 percent), and transparent promotions (71 percent) are the most important factors when choosing where to shop. And no matter the generation, great customer service is always the most important thing.