Why Millennials Must Live at the Heart of Your Supply Chain Strategy
Today’s brands are up against a rapidly evolving the commercial landscape — with consumer behavior shifting toward online shopping and consumers, themselves, changing. Of course, the new shopper on every brand’s mind is the millennial. All eyes are on millennial spending behavior and preferences, as sales and marketing try to pin down trends around the largest living adult generation. Despite the digital opportunities that such a large customer base can present companies, many begrudge the new set of expectations millennials have — especially when it comes to digital experiences. When push comes to shove — and clicks come to checkouts — brands need to take the 83.1 million millennials seriously, given they spend $600 billion annually in the U.S. alone. To ensure supply chain strategies meet demands and maximize opportunities brought on by millennial shoppers, there are a few trends that brands should keep their eye on.
Let’s Get Digital
It’s no surprise that brands need to put on their game faces when it comes to matching millennial expectations around e-commerce. The stakes are high — with millennial consumers making 54 percent of their purchases online. While millennials are credited with driving the surge in e-commerce, this statistic is actually consistent with non-millennial shoppers who on average make 49% of their purchases online. With the entire population focused on e-commerce, companies should be, too, demanding that their e-storefronts represent their brand as effectively, attractively, securely and personally as their brick-and-mortar locations.
Where millennials diverge from other generations is in the prevalence of smartphone shopping. According to a survey by MergeIn, millennial consumers make 63 percent of online purchases via smartphone, compared to 41 percent of Gen Xers and 19 percent of Baby Boomers. To keep up with millennial consumers, brands need to keep mobile in mind, but not just when designing their online presence — they must update their physical locations as well. To the surprise of many companies, 82 percent of millennials still prefer shopping at brick-and-mortar stores. This generation of consumers prefer having the opportunity to touch and interact with products prior to making a purchase, but still expect a digitally-enabled experience, particularly when it comes to an effortless checkout. According to a recent Accenture survey, 23 percent of millennials use contactless payments, such as Apple Pay or Android Pay, at least once a week. To ensure both their digital and physical storefronts are equipped to accept a variety of payment methods, brands can tap financial experts to handle the back-end business processes that make convenient checkouts possible.
Seamless Supply Chain
Every company should be focused on millennial opinions around their brand because they are likely to share them. According to the MergeIn survey, 39 percent of millennials post reviews of products or brands and 27 percent are likely to reference brands in blog posts. To ensure that consumers are writing favorably about their brand, companies need to deliver exceptional user experiences. An Accenture survey shows that 68 percent of millennials demand an integrated, seamless shopping experience, regardless of the channel — meaning they are able to transition effortlessly from digital to physical stores to find the best products or services.
Accenture defines seamlessness as a company’s ability to deliver a consistently personalized, on-brand experience for each individual customer, at every touchpoint, which can be difficult to achieve alone. By teaming up with a supply chain partner, companies can gain access to an enlarged pool of resources and share the responsibility of taking on millennial-driven modernization. Supply chain partners can help provide memorable service by enhancing company contact centers and leveraging reliable, high-performing e-commerce storefront platforms. They can also unite the digital and physical supply chains, empowering companies to offer services such as same-day delivery services and painless returns for online purchases.
In fact, returns are an area where the most millennial-friendly brands can gain major ground. Statistically, millennials are some of the most socially- and cost-conscious shoppers, favoring the ability to return, repurpose or recycle products. They find resale items, in particular, appealing for two reasons: First, they are less expensive, which is crucial given millennials’ number one concern is price (over quality, brand, and availability). Second, resale items are more eco-friendly, with millennial consumers being 75 percent more likely to be motivated by environmental concerns. To meet these desires, brands should invest in reverse logistics solutions where a supply chain partner manages all returns —replacing consumers’ products, refurbishing damaged items for online resale or recycling parts in the eco-friendliest way possible.
To maximize the incoming generations of shoppers, brands need to maximize their supply chain strategy and surrounding logistics. By striving to meet millennial demands, brands can improve their own digital and physical presences and stay competitive in the digital age.
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