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Millennials revealed as least loyal shoppers

Almost half (45 per cent) of UK millennials (broadly accepted as 23-38 year olds), admit to being less loyal to retail brands than they were a year ago, research reveals.

A survey of 4000 UK and US consumers conducted by retail operations platform, Brightpearl, set out to examine brand loyalty and found that millennials are the least loyal consumers. In addition, over one-third of shoppers, across all age ranges, are quicker to abandon a brand that doesn't meet expectations than they were a year ago – indicating that lifetime customers are a thing of the past.

Nearly seven in ten shoppers across all age ranges (69 per cent) also told researchers that if a shopping experience was poor, they would never shop with the same online store again – and a quarter of millennials would change where they buy goods from, based on the shopping experience. This suggests that brands must work harder to encourage repeat purchases, particularly from the younger demographic.

Meanwhile, one in five respondents in the 18-to-24 age bracket – rising to almost half in the 25-to-34 age group – agree that they are always looking for an improved shopping experience when buying goods online.

These results show that the key to retail success could lie in keeping millennials – now ‘the world’s most powerful consumers’ – happy.

However, this may prove more difficult than thought, as millennials are most likely to abandon a purchase due to poor experiences – and more than half of this group have done so in the last year. This age group are also most unlikely to return to a brand if they have a bad shopping experience, the research revealed.

Brightpearl's study also looked closely at the most common buying inconveniences that frustrate online shoppers and found that struggling to find products and needing to register to buy, as well as unsuitable payment and delivery options, proved to be frequent turn-offs.

However, according to the study, the biggest gripes for shoppers relate to delivery and returns. In the past year, 60% of consumers said they’ve bought goods that have not arrived when expected, while 40 per cent of shoppers have experienced items not arriving at all.

“Brands that sell directly to consumers but don’t own a seamless end-to-end buying journey are setting themselves up for failure,” says Derek O’Carroll, CEO, Brightpearl. “Shoppers no longer have the patience for unsatisfactory shopping experiences – which, unfortunately, are very common.”

“Taking the overall customer journey to the next level is essential because shoppers’ expectations now stretch far beyond the website, to factors such as delivery and returns. Get these areas wrong and customers will abandon you,” says Andy Lockley, head of eCommerce at EnergyBulbs.co.uk, an online retailer of lighting products. “We used operational technologies to make improvements to our own customer experience - including the ability to process orders twice as fast as we did before. This translated into a huge increase in positive online reviews and repeat buys from customers who place more trust in us to deliver an experience that exceeds their expectations.”

Brightpearl’s survey also revealed that 61 per cent of consumers have experienced an issue related to buying goods online in the last 12 months – and this disconnect could prove risky for brands longer-term, as customer loyalty becomes a thing of the past. With millennials now making more online purchases than Generation X or ‘baby boomers’, Brightpearl’s O’Carroll believes their buying power and expectations can no longer be dismissed.

“As millennials’ purchasing power grows, direct-to-consumer brands need to ensure the happiness of these shoppers – but there’s still work for brands to do to identify and eliminate pain points in the end-to-end buying journey. Long-term, this will be key to improving repeat sales and brand loyalty, especially for those in the younger age segments. If brands alienate younger buyers, they could lose them forever – and lose sales to competitors who offer a more seamless buying journey and better customer service.”

"Most consumers are psychologically attracted to what’s easy,” says Philip Graves, a leading consumer behaviour expert. "Points of friction disrupt cognitive ease. An unexpected moment of ‘pain’ in the form of an unanticipated delivery charge, the requirement to enter personal details because an instant payment method like PayPal isn’t available, or the news that delivery is going to take longer than anticipated, can shift a shopper’s mental state. A moment of cognitive dissonance arises that can be resolved most swiftly by going elsewhere or not completing the purchase. Consumer brands should be mindful of the need for a continuous focus on making their products easy to purchase because this is just as important as making them desirable."

However, it's not all bad news for retail brands – the study reveals that consumers would be willing to spend an average 12% more for the same product or service if they were guaranteed a frictionless experience. 18 per cent of shoppers aged 25-34 would be willing to increase their spend with brands that met their expectations.

“Systems that help close gaps in the end-to-end experience could not only help boost customer sales and loyalty – they could also help increase shopper spend with retail brands,” states O’Carroll. “With millennials willing to pay more for products and services with seamless transactions, it’s a no-brainer – and a win-win – for brands, in today’s increasingly competitive retail landscape.”

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