BrainTrust Query: The Post-Crisis Gen Y Consumer
By Doug Stephens, President, Retail Prophet
Through a special arrangement,
presented here for discussion is a summary of a current article from the Retail
Prophet Consulting blog.
Kit Yarrow, co-author of Gen BuY: How Tweens, Teens
and Twenty-Somethings are Revolutionizing Retail, says
Gen-Y has clearly become less impulsive and are more interested
in cheap thrills and sales promotions than they were pre-recession. But they
haven’t cut back their spending as much as older generations.
"It makes sense
when you consider that Gen Y had less and so lost less
during the recession," said Ms. Yarrow, a professor of psychology and
marketing at Golden Gate University. "They’re also highly optimistic
about their earning potential and consequently less cautious when it comes
to spending. This generation was trained by their parents to have high expectations.
Lastly, Gen Y "wants" feel a lot like "needs," especially
when it comes to technology."
She likewise said that while Gen Y has become
more knowledgeable about personal finance issues and money management as a
result of the recession, she doesn’t expect to see any noticeable frugality
lasting in the long term.
"Gen Y has not been psychologically damaged by the recession in the same
way that Depression Babies were," said Prof. Yarrow. "Not even close.
I’ve heard more Gen Y’s scoff at the futility of saving than I
have those who have stopped spending (though neither extreme is the norm)."
she said retailers will need to make adjustments to appeal to Gen-Y customers
in the decades ahead. One key is to get them involved and to acknowledge and
reward that involvement. Communication also needs to be more visual, symbolic
"Honestly, transparency, humor and humanness go a long way too," said
Prof. Yarrow. "There also needs to be more activity, product turnover
and sensory involvement than what satisfied previous generations. Lastly, it
makes sense to rethink absolutely everything with a nod toward what’s
technically possible today."
In messaging, she said Gen-Y consumers
always gets their say, but are not always heard.
"What Gen Y craves is to be seen and heard. Status is no longer
about money, it’s about influence," said Prof. Yarrow. "Therefore
the messages that resonate with Gen Y are those that champion the customer.
Listen, respond, notice and reward — that’s where it’s at."
Discussion Questions: Do you agree that the recession ultimately will have
little impact on the Gen-Y consumer’s purchasing behavior? What do retailers
need to understand about this generation to successfully win their attention
and loyalty as they move into their prime consumption years?
- The Post-Crisis Gen Y Consumer – Retail Prophet
- How Tweens, Teens and Twenty-Somethings are Revolutionizing Retail – Gen