Engaging with today’s increasingly demanding ‘always-on’ consumers is a tricky business. In the fast-paced digitalised world, brands need to develop a true understanding of their customers in order to tailor communications and services to suit them. Customer experience is the major battleground of modern marketing and understanding your customers is the crucial first step.
Today, evaluating the evolving demographics of the UK is an essential insight for organisations of all shapes and sizes, helping them to connect with the right audience at the right time. The much vaunted Millennials generation, otherwise known as Generation Y, provides the perfect example. This group has a growing influence, but most brands are still struggling to get to grips with the best way to engage with them.
The latest insight from Experian’s Millennial Me and My Money report shows how intrinsic and external factors have affected 18 – 34-year-olds, and how this tallies with their levels of financial confidence and stability. The research allows us to gain a true insight into their financial successes and pitfalls, the factors that have led them to their current financial position and their behaviour as consumers.
The findings highlight their determination to lay down the foundations for financial security later in life. Most save an impressive amount - three in 10 (30%) save between a quarter and half of their disposable income on a monthly basis.
Using Experian’s Mosaic segmentation tool, we can clearly see that Millennials - in part by choice and part due to affordability - have moved from owning things to renting them. They rent their flats, in many cases don’t own a car and sign up to stream their music, films and games.
Just one in 10 (11%) say buying their first home is their biggest goal within the next two years, and many are able to acknowledge what they need to do if they are to reach their goals. Around one in three say that a lack of disposable income, lack of savings (32%) and not enough annual salary (35%) mean they are struggling to meet their goals within their self-imposed two-year timeframe.
It is encouraging to see that 18 – 34-year-olds are ‘out-saving’ their older counterparts, with even fewer members of this generation falling into debt. While this is positive news, many are still making crucial errors when it comes to budgeting and managing credit, which could have far-reaching effects on their financial future and achieving these goals. They also show a distinct level of apathy when it comes to seeking value – which, if embraced, could save them significantly and help them move forward.
Despite this, nearly half (49%) are optimistic for their financial future. Millennials, it seems, have accepted their circumstances and have realistic aspirations for the future. The trend towards renting not only property, but entertainment and other services too, equates to a significant shift in behaviour that has profound implications for organisations in both the public and private sector. It is likely that this is an irreversible trend.
About Tom Blacksell
Tom Blacksell is Managing Director, Decision Analytics and Marketing Services at Experian