Today’s retailers, already contending with evolving customer preferences, aging IT infrastructure poorly suited to adapt to modern demands, and competition not only from Amazon but also from manufacturers and distributors now face a new challenge—meeting customer expectations across generations.
A recent study conducted by Oracle NetSuite, Wakefield Research and The Retail Doctor, found some significant differences in expectations, and also challenged a few stereotypes across four generations: baby boomers, Gen X, millennials and Gen Z.
The study surveyed 1,200 consumers and 400 retail executives across the U.S., U.K. and Australia.
Generations Have Different Expectations for What’s In-Store
Some of the most profound, and most surprising, differences appear in the in-store shopping experience. Know who’s more likely to do more in-store shopping this year? No, not the baby boomers (13%) and Gen X (29%). It’s the “digital native” Gen Z and millennials (43%), according to the study. More of the younger generations view the retail experience positively (57%) than Gen X (40%) and baby boomers (13%).
The results do not suggest, however, that retailers can sit back and revel in the fact that they have appealed to the coveted younger demographic with the in-store experience.
First, there’s a case to be made that young people still like going out shopping with their friends, whether they’re digitally literate, smartphone users or not. Moreover, when they do get in the store, generations view their interactions with staff very differently. Among Gen Z, 42% are more annoyed by increased interaction by retail associates. Millennials (56%), Gen X (44%) and baby boomers (43%) all noted they would feel more welcomed by more in-store interactions.
What’s the takeaway for retailers? Clearly, Gen Z is the first truly “digital native” generation. They know what they’re looking for, they’ve often researched a purchase before they enter the store and, when they do need help, they expect the store associate to know more than they do. They also want an associate that isn’t pushing products that aren’t relevant. That means store associates need to be sufficiently trained and equipped to handle any situation that arises, whether that’s recommending complementary products or, if something is out of stock, shipping it to the customer’s home from a warehouse or even a nearby store. Provide a poor experience and the customer is likely to take their complaints to social media—something true of all generations.
Invest in Social Media, with Tempered Expectations
However, social media is not the panacea many retailers believe it to be, according to the study. While almost all retail executives (98%) think that engaging customers on social media is important to building stronger relationships, overall only 12% of consumers think social media has a significant impact on the way they think or feel about a brand.
For those that do engage with brands over social media, the results more closely follow expectations with Gen Z consumers (38%) much more likely than other generations to engage with retailers on social to get to know the brand compared to millennials (25%), Gen X (27 %) and baby boomers (21%). Similarly, Gen Z (65%) consumers and millennials (62%) believe social media platforms have an impact on their relationship with brands, while more than half of baby boomers (53%) and 29% of Gen X consumers do not engage with brands on social media.
The takeaway here for retailers? Those that want to reach millennials and Gen Z had better make a commitment to social. Social media is a form of trust; those that are not active on social channels are viewed as less trustworthy. For example, Gen Z expects brands to showcase their personality online.
If a retailer wants to connect and influence purchases, they need to be active and responsive on social. If a retailer isn’t, their younger customers are. Many Gen Z apparel customers post pictures of items they are considering and then 46% make a purchase based on the feedback (social proof) to that post.
Access the full report (opens in new tab) for more details on generational differences in retail expectations and what retail executives are thinking .
