Many brands want to touch the hearts of millennial customers for good reason. Millennials are an influential generation; they are educated, tech-savvy and socially active, shop more frequently and spend more than other sectors of the population. To tap into their potential as brand advocates, retailers need to map out tightly integrated solutions to engage millennials and drive commitment by understanding their characteristics, buying behaviors, purchasing decisions and customer experience.
A recent study by ICLP reveals what millennials value most from brands and provides insights for retailers to foster closer connections with this generation. Key to driving devoted customer relationships is building trust with existing and potential customers; however, the study found that only 2% of Hong Kong millennials are devoted to their favourite retailers. It seems retailers find it difficult to understand what their customers want and this widens the gap between what millennial customers expect from brands and what is being delivered. How can retailers connect with this important customer group and implement a comprehensive, lifetime, tailor-made loyalty rewards programme that fit the specific needs of millennials? Those are the challenges.
Understanding millennials and how to build loyalty and trust with them
Millennials are the biggest spending generation and also the most diverse. Brands should truly understand the characteristics and individual buying behaviours of millennials in order to map out integrated solutions to engage them. Only then can retailers convert the ‘liking’ relationships that 33% of Hong Kong millennials have with brands into ‘devoted’ relationships.
Social media engagement
Tech-savvy Millennials are more socially active than other generations. They are willing to reach out to their community to share the latest trends and receive the latest offers. Retailers should not only build an active social media presence, but also use social media channels to interact with customers.
Blended educational context with promotional offer
While welcoming engagement, 29% of Hong Kong millennials expressed that they don’t want brands to aggressively sell to them. Brands should choose the right social platform to provide editorial content relevant to their interests and by asking neutral and open-ended questions to encourage different opinions and allow discussions to flow naturally.
Millennials care about being able to relate to the brand story and have a stronger affinity to the sentiment articulated through the brand story than the product. An authentic approach to creating content is not only the key to capturing the attention of millennials, but also their trust. Authenticity plays a huge role in marketing to millennials, from increasing brand awareness to engagement.
Loyalty programmes in the eyes of millennials
Millennials are browsers not buyers, spending 5-10 hours daily consuming a copious amount of online content, and they often react promptly on social media to comment on or share a particular promotion. So creating a brand experience within the digital world with relevant content may be the first steps in captivating interest from this generation.
As 61% of Hong Kong millennials would feel valued if brands were better at communicating with them, retailers need to perceive their point of view and put greater emphasis on the things they value most. Retailers need to understand the key drivers that build more loyal relationships and encourage millennial customers to shop more frequently, spend more and earn their loyalty.
To win in this competitive retail landscape, brands should adopt a more holistic and inclusive approach that recognises strength in numbers and value in diversification. Personal, unique rewards are more important as loyalty drivers to millennials than price alone.
By acknowledging the brand values that millennials treasure, brands need to surprise and delight customers with unique customer experiences instead of monetary rewards such as discounts and freebies. Experiences engage customers in creating memorable events that connect them emotionally to the company or the brand. This enhances the brand’s uniqueness and highlights the importance of using better engagement strategies to create a reciprocal sense of passion that drives continuous customer devotion and develops long-term trust and devoted relationships.