The retail app chasm between Millennial's and Baby Boomers

BY Anthony Smith
25 April 2018

There’s no doubt that mobile apps are on the rise, particularly in retail environments where traditional brick and mortar stores are searching for new ways to connect with consumers and compete for a piece of the retail pie. In fact, according to Deloitte’s 2017 Australian Mobile Consumer Survey, browsing a shopping website/app and researching a product/service are the most popular shopping related activities on a mobile. The number of Australians that browse online shopping sites on their mobiles has risen 14% in the past year, and online purchases have increased by 25% since 2016.

Embracing mobile apps to create a hybrid online and in-store shopping experience can bridge the gap between the digital and physical worlds to bring customers back into stores while also increasing brand loyalty. And since certain age groups are more receptive to retail apps, increasing their use is critical to retailers’ top line.

To better understand the digital and in-store shopping habits of Millennial's (aged 18-24) and Baby Boomers (aged 55-64), Aruba, a Hewlett Packard Enterprise company, conducted a global study of more than 350 shoppers. Based on the response, Millennial's use retail mobile apps significantly more than Boomers, they are more attracted to brands with loyalty apps, and are less cost-conscious than their elder counterparts.

Here are five facts retailers need to know about their Millennial and Boomer customers that can help bring these customers back into stores.

ARA_millennials-and-baby-boomers

  1. Loyalty outweighs price for Millennials

Loyalty programs have gained popularity with the rise of smartphones, as the ability to store a number of loyalty program apps in a single, readily accessible device makes it inherently easier for shoppers to use the apps when visiting retail establishments.

Millennial's love their loyalty apps, with 66.3% indicating they are more likely to shop from stores where they are part of the loyalty program, vs. only 33.3% of Baby Boomers answering the same. For Baby Boomers, price was the biggest driver for a purchase decision, with 40.7% indicating it’s more important than a loyalty program versus only 22.5% of Millennial's indicating price as the driving factor. 

  1. In-app features win hearts and dollars

But what attracts consumers to download and use loyalty apps? When asked what incentives would make consumers download a retail mobile app, here is how Millennial's differed from the Boomer generation.

Millennial's

Baby Boomers

#1 Parking spot locator

#1 Product availability and comparison

#2 Product availability and comparison

#2 Find a sales assistant

#3 Digital payment through retailer mobile app

#3 Obtain special incentives or coupons

 

There is a clear distinction between the generations. Baby Boomers treat retail mobile apps as a tool to execute more traditional shopping habits: they still want to find a sales associate and interact with people face-to-face, are more price conscious, and value coupons and incentives more than Millennial's. In contrast, Millennial's are focused on convenience and speed; they want to find parking and make payments from their phones quickly and easily. This aligns closely with Deloitte’s Australian Mobile Consumer findings, which noted 18-24 year olds remain the primary adopters of bio metric authorisation technologies for purchasing products through a mobile device.

  1. Regular app use is key to retaining customers

Getting buyers to download a mobile app by drawing them in with a special incentive may result in a high volume of one-time users, but the real gold is in how often shoppers use the app. Raising the frequency of use is critical to growing a retailer’s top line.

The Aruba study found that Millennial's used retail apps more frequently than Baby Boomers, with 61.8% indicating they use them 1-5 times a week vs. 48.2% for Boomers. This spread became more evident when the frequency of use hit double digits. Over 13% of Millennial's reported using retail mobile apps more than 10 times a week, while none of the Baby Boomers reported doing the same.

  1. The sales assistant’s role has changed

 

Younger generations have grown up with portable electronics as part of their daily life. They are accustomed to interacting with electronic kiosks rather than live attendants and for the most part, actually prefer it. When asked how they prefer to search for products inside retail stores, more than half of Millennials (53.9%) prefer using a mobile app rather than consulting a traditional sales assistant. In contrast, Baby Boomers favoured human interaction with 44.4% indicating they would opt to use an app to find products.

  1. Eat in or takeaway?

Younger generations are accustomed to eating out more and cooking at home less frequently. The variety of food and cost-efficient options available today make eating out very appealing for Millennials on the go. When asked what kinds of retail mobile apps they use most frequently, Millennials’ top selection was mobile ordering for express food pick-up (55.1% vs. 33.3% Boomers). Conversely, the Boomers’ top selection was grocery and convenience store apps (40.7% vs. 18% young Millennials) as they tend to eat at home more often.

When going head-to-head with e-commerce retailers, brick and mortar stores need to embrace new technologies, like mobile apps, to stay competitive and attract shoppers. By understanding their customers’ habits and needs, whether they are Millennial's or Baby Boomers, retailers can create a personalised and efficient shopping experience that will keep their customers loyal.

About Aruba

Aruba, a Hewlett Packard Enterprise company, is a provider of next-generation networking solutions for enterprises of all sizes worldwide. The company delivers IT solutions that empower organisations to serve the latest generation of mobile-savvy users who rely on cloud-based business apps for every aspect of their work and personal lives. To learn more, visit www.arubanetworks.com

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ABOUT THE AUTHOR

Anthony Smith

Anthony is the general Manager of South Pacific, Aruba

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