Far From Being Impulsive Buyers, Millennials Agonize Over Online Purchases

Businesses that focus on Millennials — people born between 1980 and 1995 — are increasing as their numbers swell (globally around 2 billion), as well as their spending power: Accenture estimates there will be a transfer of at least $30tn in wealth from US baby boomers to millennials during the next three decades.

Much of that wealth will be spent online. In 2019, the total market share of “non-store” or online U.S. retail sales was higher than general merchandise sales for the first time in history. For brands, it is crucial to learn what motivates the purchases of this group of people, especially online, where almost 40% of Millennials, the first digitally native generation, shop.

While Millennials are known for considering a brand’s social responsibility and environmental friendliness when weighing up their purchases, there is also a widespread perception that this generation, specifically Americans aged between 22 and 37 — is particularly prone to impulse buying.

However, new data from Shoptagr, (a smart online shopping assistant), show that, contrary to popular belief, Millennials aren’t spur-of-the-moment buyers.

Only fools rush in: Time from initial interest to actual purchase

Millennials are prudent, with only 11% buying a product they’ve shown interest in on the very same day they discovered that product. Just over half of millennials purchase the product within two weeks of showing initial interest. 78% — most — go through with purchase up to 60 days from initially showing interest.

Our data show that Millenials are cautious, price-conscious, and diligent in monitoring price movements of the products they’re interested in. Businesses that understand this process and support millennials in their pre-purchase journey with smart tools like price/stock monitoring, comparisons, personalized real-time alerts, and other data are likely to see higher sales in the long run.

The Discount Trigger

Overall it seems that the discount trigger for Millenials to purchase items (not during shopping season but during the rest of the year) is 30% off. As illustrated below, we saw a steep increase in these types of purchases — where a discount has reached 30% — during Black Friday and Cyber Monday, even though the average percentage of discounts throughout the year remains the same.

What’s interesting is that we see the same increase in full-priced purchases during the shopping holidays like Black Friday, as it seems that shoppers are simply waiting to pull the trigger on their most wanted items even though the price didn’t drop more than 30%.

Meaning, the Millenials we measured were prudent as far as the whole year went, but when Black Friday came around, they indulged in a “cheat day,” probably because they’re worried their items will be sold out, and also out of FOMO — and — there is a good reason to be worried. Our data shows that from the moment a product goes on sale (more than a 15% price drop), it usually takes up to 48 hours for it to become out of stock/sell out. Below are the top 20 most popular retailers/market places among Shoptagr’s Millennials in the United States.

*Based on Shoptagr’s 1.5 Million users.

About Shoptagr and this data-led insight paper

Shoptagr’s technology lets users save products they’re interested in and monitor their price movements and stock availability down to SKU-level across the web and apps. The data below is based on Shoptagr’s 1.5M+ users, mainly from the United States. The demographics of the users are age 22–37, with an average annual income of $54,100. The data was collected anonymously over the past 24 months (up to Dec ‘19).