Megan DeCosta joins us as a guest blogger for rDialogue with a unique look at Millennials and strategies retailers and financial services providers can use to build relationships with them. As SVP, Loyalty Services at Citi Retail Services, Megan leads Citi’s efforts to build retail and card product loyalty with consumers across a broad spectrum of Fortune 500 companies.
Pop quiz: What’s the largest American generation of all time?
Hint: It’s not the Baby Boomers.
At 79 million people ages 15-34, the Millennial generation is three times larger than Generation X and surpasses even Boomers in number. By 2030, Millennials will outnumber non-Millennials.
Retailers are scrambling to secure the loyalty of this tech-savvy and fast-paced crowd, which spends $600 billion a year. But many retail card providers are falling behind. At Citi Retail Services, we’ve been spending a lot of time thinking about these consumers with our retail partners in mind, focusing on what we need to do to truly deliver on Millennials’ needs.
So, who are the Millennials? And, specifically, what are they looking for in a rewards program?
Millennials — a.k.a. Generation Y — are notoriously brand loyal, but there’s a catch. Rewards have to fit their unique needs and desires. Studies show that Millennials will promote brands online and share personal information for rewards, but they expect benefits in return. Nearly 80% will choose a brand with a rewards option over a brand without one. Forty-two percent will choose a card for long-term benefits, but 78% also expect to be rewarded within three months of joining a program.
Hyperconnected and intensely social, Millennials love variety and customization. They’ll personalize anything, from their phones to their bodies (at least 30% have tattoos). Since they’ve grown up with technology and get bored easily, Millennials are best reached through multi-channel (mostly digital) loyalty programs with simple, quick copy. More than 90% want to manage their credit cards, their banking and their rewards balances online.
Here’s a peek into Millennials’ mindset on loyalty and buying:
- Loyal: Reward me quickly and make it easy.
- Make it Fun: Ever on the hunt for a game.
- Know Me: I’ll let you in, but use my info to send me relevant information.
- Researchers: Shopping is a highly orchestrated mission, and I rely on online reviews.
- Money Managers: I’m anxious, but aspire to be responsible.
Citi partner Bloomingdale’s is a brand that’s doing it right. The Loyallist program allows shoppers to earn points in a variety of ways with few restrictions. Customers can easily track their progress online, and the Loyallist app keeps them engaged. Virtual dressing rooms make things fun and appeal to the desire to personalize.
Right now, the youngest Millennials are getting their driver’s permits; the oldest are buying homes. In coming years, these consumers will move through several significant life stages. So, retailers have to stay in touch with who their customers are and how their lives changing to clearly demonstrate how their brand is relevant to Millennials’ big-picture goals. Boring language won’t work, and neither will products that aren’t in touch with their unique generational perspective.
Citi Retail Services believes reward programs that remain relevant to this generation throughout life-stage changes will keep them as customers for the long haul. The Millennials have big dreams. Help them achieve those dreams and you could earn their loyalty for life.