46 April 2017 | beautystorebusiness.com

10 things beauty retailers need to know about millennial shoppers—plus tips on how to capture their interest.

by Manyesha Batist

If there were ever a generation that deserved your thoughtful planning, merchandising and product selection based on its sheer magnitude of population, shopping prowess and buy-

ing power, it’s the millennials. Born between 1982 and 2000, millennials have officially surpassed baby boomers as the largest generation, accounting for roughly 25 percent of the American population—about 80 million people, estimates the U.S. Census Bureau. Not only that, the millennial population is still growing, as immigrants continue to populate the United States. If that weren’t sufficient to pique the interest of savvy retailers, experts estimate millennials will spend $200 billion annually by the end of 2017.

A few things are clear about millennial beauty shoppers: They are smart spenders and knowledgeable shoppers who don’t mind splurging when something excites them or is exactly what they’re looking for. “Compared to older genera-tions, millennial households underspend their expected share across beauty as a whole. On the other hand, millennials spend 20 percent more than their fair share in haircare accessories and 14 percent more in cosmetics,” explains Jordan Rost, vice president of consumer insights for Nielsen. In other words, they spend where it matters to them. fo

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48 April 2017 | beautystorebusiness.com

What’s more, skin care and personal care are among the more important beauty categories for millennials, bumping up against makeup, of course. A couple of factors may contribute to this trend:

Millennials are an extremely

conscious group. They’re aware of the ingredients in the products they use, and they care about how the brands they buy impact the world around them. So, it makes sense that millennials are mindful of spending their hard-earned cash on beauty products that really count. And truth be told, this group is not getting any younger, with the oldest millenni-als now in their mid-30s. This insight rings true at organic and natural beauty retailer Vert Beauty. “At Vert Beauty, you will find millennials spending the most on skin care,” says Vert Beauty founder and owner Amanda Hume. “They are getting to the age where aging is a con-cern for them. So, they tend to splurge on a facial serum versus a new eyeshadow.”

Rost adds, “Personal-care products are the second most commonly purchased consumer goods online, behind only cer-tain health products. This is particularly true for millennials, 60 percent of whom will purchase personal-care products online over the next six months.”

Katie Matthews, director of stores east for beauty retailer Cos Bar, notes millennials’ tendency to invest in one or two products, rather than an entire regimen, when it comes to skin care. Retailers would do well to be aware of

this fact when selecting products for their own stores.

Millennial males are increasingly

purchasing men’s grooming prod-

ucts. “We see men who are on the later spectrum of millennials who are con-cerned with aging,” says Hume. “We sell a lot of facial cleansers, moisturizers and beard oils. It is definitely a category that will continue to grow. At Vert Beauty, we just expanded our men’s selection, so that the men can have more options available (even though everything in our store is unisex).”

Aside from makeup, skin care and personal-care products, natural ingredi-ents are another big draw for millennials. A variety of shopping characteristics and preferences apply to millennial shoppers. As Rost puts it: “The millennial genera-tion spans a wide range of life stages, from young adults still dependent upon parents or guardians to older millennials starting families of their own.”

Here are some top millennial insights retailers should know.

THE TOP 10Open to New Ideas

“Generally speaking, millennials are more open to new ideas than older generations,” says Rost. He adds that 77 percent of millennials are willing to try new brands. This means that your millen-nial customers are likely to explore those new products you add to your shelves that are unfamiliar and even different.

“They want to see the latest and great-est,” concurs Christine Sandoval, Cos Bar’s director of stores west. “They are confident, adventurous, trend driven and attracted to newness. Other generations come in with specific concerns that they want to address. Millennials come in for an item or brand that they’ve heard about.”

Experience Matters

Millennial shoppers are a sensory and experientially driven group. They want to see, hear, taste, touch and smell their prospective purchases. And they want to have a good time doing so. Atmosphere, customization, personaliza-tion and experience all matter.

“They are independent shoppers and look for an environment where they can do their thing: fix their lipstick, spray their hair, touch up their mascara,” says Sandoval. “They are not always com-ing into the store to buy, but rather to experiment and discover. If they’re com-ing into a store instead of buying online, they want the one-on-one attention. Here, millennials can receive a personal experience, but still have anything and everything at their fingertips to try.”

Tech Savvy

This generation is a tech-savvy one. Thus, retailers are advised to keep current with the latest and trending technologies that affect retail. Millennial customers are making mobile payments,

purchasing online and using digital cou-pons and location-aware apps. “Online sales exceeded $12 billion, according to Adobe Digital Insights in 2016, which reinforces the importance of your brand’s access and ease online in addition to the store retail experience,” says Joan Kuhl, founder of Why Millennials Matter. “Millennials want access to both, but, for sure, are going to be banking on the option of purchasing online.”

Jenna Hilzenrath, public relations director for beauty subscription service and retailer Birchbox, says most of Birch-box’s traffic comes from mobile. As a result, the company is giving even greater attention to mobile. “It’s been a huge priority to maximize our mobile experience—through both our app and mobile web—and make it as fast and easy to use as possible.”

Retailers that follow suit and align their operations with their customers’ technological habits keep their stores competitive and relevant.

Intelligent Shoppers

Millennial beauty shoppers are smart, experienced, curious and dis-cerning. “Millennials are savvy shop-pers who can research your brand/product everywhere and anytime,” says Kuhl. “So, top Google searches and your brand homepage are critical.”

Sandoval adds, “They are independent shoppers and are comfortable browsing T

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50 April 2017 | beautystorebusiness.com

and trying on their own. They compari-

son shop and do a lot of research online

before they buy.” Consequently, smarter

retailers that are more experienced, curious

and discerning will capture millennials’

trust and interest.

Budget Conscious

Many millennials entered adult-

hood amid the recession, receiving a

crash course in discerning value before

making purchases, due to limited funds.

Hume’s experience underscores this

observation: “Millennial shoppers look

for value and quality. For instance, they

will purchase a more expensive facial

serum—if they are sure that it will be

worthwhile—and a less expensive facial

cleanser—that they trust—to meet their

budget. They tend to think about the pros

and cons of purchasing products, and if

their money would be well spent.”

Karen Grant, global beauty industry

analyst at The NPD Group, concurs:

“Millennials shop most frequently, but

cannot afford to waste their limited

resources on anything that does not

work or that does not either elevate their

status or benefit their look.”

Loyal? Maybe…

Beauty retailers and experts

express varying opinions about the loy-

alty of millennial shoppers. On one hand,

retailers say millennials are loyal to the

brands they’re truly passionate about.

And, yet, they’re still open to discover-

ing brands that have an edge over their

current products. “In my experience,

millennials are the trendsetters. When

it comes to shopping, they are adventur-

ous with trying new products; but are

extremely loyal to the products they

love,” shares Hume.

Kuhl presents a slightly different per-

spective, noting that “Millennials are

loyal, but on the prowl for better expe-

riences and stronger alignment to a

brand’s impact and message.”

However, Sandoval sees an open-

mindedness and, consequently, a lack of

brand loyalty among millennials. “They may

know what works for them, but are open to

finding something that works better.”

The answer may be dependent upon

the segment of the millennial population

that shops your store.

Messaging and Source Matter

“More than 50 percent of mil-

lennials make an effort to buy products

from companies that support the causes

they care about (Barkley agency), which

is even more aligned to female millennial

shoppers in their late 20s and early 30s,

as their income rises,” explains Kuhl.

“They are sensitive to a brand’s mes-

saging and mission to impact the world

beyond making a profit.”

Millennials are prone to doing research

to discover those products that align with

their values, whether efficacious, sustain-

able, eco-friendly, organic, cruelty-free,

fair trade and so forth. “[This is] very

important. I think it is probably one of the

most important factors. They like to know

where things come from and how they

were made,” says Hume.

Try Before Buy

“The Next Gen of beauty power

shoppers (millennials and younger) not only

want or prefer to try before they buy, but

they see it as a need,” says Grant. “Finan-

cially and socially, product trial fills a real

void. They are the most cash-strapped

generation and the most likely to state

their need to factor cost and budget among

their top purchase concerns.”

One might argue that this try before

they buy characteristic not only serves

their budget but satisfies their thirst for

“experience.” Therefore, retailers would

do well to offer samples and keep testers

readily available, along with other similar

incentives. “Millennials are attracted to

discounts, gift with purchases and sam-

ples, as they tend to be try-before-buy

shoppers,” affirms Matthews.

Save to Splurge

Believe it or not, millennials’ try

before they buy habit may help increase

retailers’ profits, as millennials are also

apt to splurge when they discover prod-

ucts that are efficacious and exciting.

“Value, price and quality are all very

important to the millennial shopper, but

she will splurge on a higher priced item

if it delivers on its promises,” explains

Matthews. “I would venture to say

that efficacy is more important than

brand name or price. They’ll save up and

splurge on an item that they are really

excited about.”

Chief Influences

A combination of the internet and

user reviews may be a retailer’s key to cap-

turing millennials’ dollars. Experts did not

hesitate to list these two factors as chief

influences on millennials’ buying decisions.

“Real user experience drives their

confidence over direct advertising,” says

Kuhl. “They need the validation from cus-

tomers that actually used the product or

service to connect with its benefits and

the necessity to their own personal life.”

What’s more, “Their beauty authority

is the internet,” adds Sandoval.

RETAILER

RESPONSEObserving your millennial customers and

continuing to gain insight into how they

interact with and select products will always

prove profitable for your store. Keeping your

staff attentive to customer needs and expe-

riences, as well as continually adding fresh

selections to your shelves will keep your

millennials happy and attentive.

Kuhl reminds you to tap your millen-

nial workers for their firsthand knowledge

of their generation’s shopping experience.

She adds these words of wisdom: “Get

social. Pick two social platforms to really

focus on (even your brand blog). It is not

about the number of followers, but more

about the authenticity of the conversation!

Build an experience that allows for an

insider VIP view of your brand from start

to finish. [Regarding your content/market-

ing], you don’t need the biggest celebrity.

Focus on real people—[stories of] young

consumers living their life. Finally, zero in

on specific segments, such as the Millen-

nial Mom and study her journey from start

to finish to identify the key moments when

she needs and relies on your [products or

retail brand] emotionally.”

In the end, David Olsen, CEO of Cos

Bar, says it best: “Stay relevant and

current. Be genuine. Create experiences.

Have a strong digital presence.” ■

Manyesha Batist is a freelance journalist

based in Denver. Jack

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