The much-maligned millennial generation has been talked about endlessly and accused of killing everything from napkins to golf. So when millennials aren’t busy destroying industries, where is their money going? We decided to take a look at TraQline’s data to see how millennials compare to the generations who’ve gone before. While it’s hard to generalize what millions of millennials spend their money on, we can examine which categories they’re outspending other generations, what brands they’re spending on, and how they’re buying those products. These first waves of digital native shoppers are spending in categories that reflect their current lifestyles and needs, and are drawn to brands who echo their ease with technology and willingness to go beyond brick and mortar to find what they want.
Where Millennials spend their money
The top 3 categories purchased by millennials account for 64% of all the dollars that the generation spent across the 9 TraQline categories:
- Consumer electronics (25% of Millennial dollars spent)
- Major Appliances (24%)
- Computer/Communication/Home Office (15%)
On the other hand, Millennials spend significantly less than their older peers in the following categories:
- Building or Plumbing supplies (0.6% of dollars spent by Millennials)
- Kitchen & Bath Improvement (0.9%)
- Home Improvement (7%)
The generation that grew up with tech comes of age
Millennials tend to be digital natives, and their spending reflects that. One-quarter of millennials’ spending mix goes to consumer electronics and 15% on computing and home office products. Not only do Millennials place a high value on their tech, but an increasing number of workers choose to telecommute, and/or continue to do work from home during evenings and weekends. We may begin to see even more money being funneled into home office products by this group.
A recent HSBC survey indicates that only 35% of American millennials are homeowners. With millennials in the early stages of starting up their own households, spending mix is significantly higher in categories such as Major Appliances (these expensive purchases make up 24% of millennials’ dollars spent). At the same time, older generations, with their higher incidence of homeownership, are outspending millennials in home improvement areas, such as kitchen & bath, home improvement products, and lawn and garden. These products designed for upkeep and upgrades are naturally purchased more often by those generations who have been homeowners for years.
Brands that Millennials prefer, and how those brands fare with other generations
With tech and appliances being the top purchases for Millennials; and given that tech companies such as Samsung and LG also make successful “techy” major appliance products, the top three brands might be obvious. Accounting for about 28% of their dollar mix – these three companies historically are perhaps best known for their consumer electronics. Samsung, which wins the largest percentage of millennial dollars, has married technology and design to help attract Millennials, as have #2 and #3 – Apple and LG.
It’s not all high-tech gadgets and consumer electronics for millennials though. In terms of dollars spent, General Electric and Whirlpool both rank highly with millennials when it comes to making major appliance purchases.
Do millennials shop more online than other generations?
As noted earlier, millennials are digital natives. Most millennials grew up with the rise of the internet and were in high school or college for the ascendency of smartphones. As a result, millennials are more likely to shop online than any other generation. Additionally, almost 22% of all dollars millennials spend on consumer durables is spent online. Only the Gen Z generation – just now growing into adulthood – spends more money online than millennials. Some of the categories where millennials are shopping online significantly more than other generations include:
|Millennial top categories
|Next most active generation
|Furniture & Home Accessories (51%)
|Home Improvement Products (32%)
|Lawn & Garden (46%)
|Consumer Electronics (71%)
That isn’t to say that other generations aren’t shopping online. In fact, members of the Silent Generation (approximately age 72 or older) are more likely to shop for power tools online than the more e-commerce savvy millennials. Additionally, Boomers and members of Gen X are significantly more likely to seek out both small and major appliances online.
How to Reach Millennial Consumers | TraQline
Retail for consumer durables is definitely changing as new generations come of age. Millennials are still participating in the economy, despite the doom and gloom of some news reports. Where they concentrate their spending may be new or different, and reflects their lifestyles, but there’s still plenty that is familiar to older generations. We may even see a shift in how millennials spend as they begin to establish households, though the brands themselves may vary from what previous generations have preferred. What have you noticed about the millennial consumers coming to your stores or buying your products? We’d love to have your insights to add to our data! Leave us a message on LinkedIn, or tweet us @TraQline! If you are ready to reach millennials and other target demographics, let the TraQline data help. With insight into a wide variety of industries, TraQline is here to help your business stay ahead of trends and changing markets. Contact our experts to learn more about TraQline today!