How to Build Brand Loyalty with Millennials through Mobile

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How to Build Brand Loyalty with Millennials through Mobile

07/26/2016
The Millennial generation, or those aged 18-34 in 2015, has reached 75.4 million in number and recently surpassed Baby Boomers as America’s largest generation, according to the U.S. Census Bureau. Making up 25 percent of the United States population, Millennials’ consumption behaviors influence broad issues and trends, as well as specific product design and development. Their preferences have wide impacts across industries—from technology, to entertainment and retail. In particular, retailers ought to pay close attention to Millennials’ increasing digital sophistication and shopping habits, especially as they pertain to new and evolving channels and platforms. With the rise of all things digital, Millennials have used the power of their preferences and wallets to influence mobile shopping.
 
Millennials will play a large part in driving retail sales on mobile devices this year, with 92 percent of Millennials having used mobile phones for shopping purposes, as mentioned in a recent Wanderful Media survey. But how are Millennials using their phones, and how can retailers best interact with this influential cohort?
 
Digital rules
One of the most common ways Millennials use mobile to shop is through dedicated store apps. A Forbes study of 1,600 Millennials found that nearly half of respondents have downloaded a shopping app to their smartphones. The most popular apps among the group include Amazon, Etsy, Forever 21, Wanelo, Starbucks, JackThreads and Modcloth. More than half of respondents (54 percent) also said they enjoyed shopping through the apps because the overall experience was better than with online shopping. Part of the allure of dedicated store apps is the app-specific discounts and sales, as well as loyalty and points programs.
 
Peer-to-peer recommendations and approval are also important to Millennial shoppers, and the emphasis on all things mobile makes it even easier for them to share product preferences and reviews in real time. Millennials like to feel they are purchasing items that their social circle would approve of, and they may choose one product or store over another based on how it would make them look among their peers. Mobile use, along with social media, connects Millennial shoppers instantly with their peer groups and allows them to receive real-time recommendations and feedback on purchases.
 
Strategies for engaging millennials
With Millennial behaviors in mind, how can retailers engage this powerful audience through mobile?
 
• Loyalty Programs. Well over half (63 percent) of Millennials in a recent COLLOQUY survey said they joined a loyalty program within the past year. Loyalty programs can take different forms, from rewards points to specialty deals and secret sales. But whichever form the loyalty program takes, retailers should make sure that they are communicating pertinent information to their customers, as irrelevant communications caused nearly half of Millennials in the survey to stop using loyalty programs.
 

• Smoothly running apps. For larger retailers with proprietary apps, the app should showcase a strong brand voice with contributions from fans and also offer integrated features for brick-and-mortar shopping. Above all, the app must be bug-free. If a mobile app is buggy, slow or prone to crashes, Millennials will stop using it in favor of another smoothly running app.
 

• Strong online presence. For those retailers that don’t have proprietary apps, it’s important for their online presence to be strong, leading with a mobile-friendly or mobile-optimized website. A mobile-friendly website displays correctly regardless of the device, whereas a mobile-optimized website is a separate version of the site designed specifically for smartphones. Users, and Millennials in particular, will appreciate the customization they receive from exploring a mobile-friendly or mobile-optimized website that enhances their shopping experience by providing features such as a simplified checkout process or custom menus, badges and notifications. Above all, advanced websites provide powerful analytics that retailers can harness to gain insights into customer behavior.
 

• Social media engagement. Retailers should take advantage of existing platforms where Millennial customers are already engaging regularly, such as Facebook, Instagram, Snapchat, Twitter or YouTube. Building out a retailer’s brand presence on Twitter, partnering with influential brand ambassadors on Instagram, advertising via Snapchat, and initiating promotions or contests via social media platforms are all strategies that retailers can use to connect with their target audiences in real time.
 

• In-store mobile integration. In-store shopping has also evolved to incorporate digital shopping for Millennials, and retailers can leverage this trend by marrying in-store promotions with mobile experiences. Take a note from Saks Fifth Avenue: the store recently unveiled a promotion that allows shoppers to take a 360-degree view of new outfits by modeling in front of a large mirror-screen, which in turn sends a short video of the user to an on-site iPad that captures the user’s personal information as they sign up. The user can then send the video via mobile to their friends to get real-time feedback on their potential purchase. This approach simultaneously captures valuable customer data while also catering to Millennials’ shopping preferences and yearning for peer approval.
 
Data is king
When retailers are implementing strategies to engage Millennials, it’s key to leverage the data available that will shed light on consumer preferences and behaviors. What are the top three considerations should retailers bear in mind? 
 

• Become educated about analytics. Technologies such as Google Analytics and Hubspot provide insight into the online behaviors of users while they are visiting a website — including the demographic of the user and whether mobile is used.
 

• Monitor the conversation. Monitor what Millennial customers are doing and talking about, and be there to engage on relevant topics. According to a CrowdTwist study, 43.5 percent of Millennials said they use social media to spread the word about products.
 

• Create targeted content derived from data findings. Retailers can analyze website traffic data for key insights on the shopping behaviors and interests of Millennial shoppers to better understand how they're engaging with content and what resonates best.
 
Millennials have emerged as a powerful force when it comes to consumer spending, so retailers must determine the best strategies to effectively reach this cohort and establish brand loyalty.

Natalie Kotlyar is partner and leader of BDO’s Northeast Consumer Business practice group.