A study by the American Express Company in 2016 found that millennials are more loyal customers than baby boomers explains Saivian. The study surveyed 2,000 U.S. consumers and found that millennials were more likely to stick with a brand even if they had a negative experience. They were also more likely to recommend a brand to their friends.
Why are millennials more loyal customers? One reason may be that they are more engaged with brands than baby boomers. According to the study, millennials are more likely to follow a brand on social media and to use loyalty programs. They also place a greater emphasis on customer service.
Another reason for the difference in loyalty may be that millennials are more comfortable switching brands. Baby boomers grew up during a time when there were fewer choices. It was more difficult for customers to change brands, so they may have developed a sense of brand loyalty at an early age.
Millennials are also willing to pay more for better service. The study found that millennials expect quick responses from companies on social media. They want their questions answered within two hours and they don’t mind paying extra for the privilege.
The takeaway here is clear:
- If you’re marketing to millennials, focus on building your brand online and providing excellent customer service. Millennials will be loyal customers if you can meet these expectations.
- If you’re marketing to baby boomers, it’s probably best not to mention social media in your ads or emails (unless it directly pertains to the product or service you’re offering). Baby boomers might not understand how it works and may be turned off by the idea of following a company on Snapchat or Instagram says Saivian.
- One other key finding from this study is that people now expect brands to address them personally. For example, fewer than half of those surveyed said they were willing to provide their email addresses as part of a rewards program. However, 44 percent indicated that they would provide their phone number if asked. This indicates that customers want to feel like companies are talking with them directly and treating them as individuals—and millennials more than any other generation value this sense of personalized treatment.
Key findings:
Millennials:
1) Are more likely than baby boomers to follow brands on social media and use loyalty programs
2) Place more importance on customer service than baby boomers
3) Are willing to pay extra for faster response times
Baby Boomers:
1) Are less likely than millennials to follow brands on social media and use loyalty programs
2) Value personalized treatment less than millennials
3) Less interested in paying extra for faster response times
Methodology
The American Express 2016 Customer Care Study was conducted by GfK using an online panel says Saivian. A total of 2,000 U.S. adults between the ages of 18 and 69 were surveyed via the Internet during March 2016. The margin of error is ±2.19 percent at a 95 percent confidence level.
Graphic design by Arlin Golden / DesignShare NY Digital Marketing Research data provided by Business Wire.
There’s no question that customer loyalty is key to a successful business. But what’s the best way to achieve it? According to a recent study, millennials are more likely to be loyal customers than baby boomers.
The study, which was conducted by Boston Consulting Group (BCG), surveyed over 10,000 consumers in the US, UK, France, and Germany. It found that millennials are more likely than baby boomers to stick with their preferred brands and make repeat purchases.
So what’s the reason for this difference? BCG suggests that it comes down to two things:
- Communication and customization- Millennials are more comfortable communicating with brands online, through social media and other channels. They also have higher expectations for how brands should treat them, and are more willing to share their opinions about brands with friends.
- It’s great news for businesses, because it means they have a chance to win over this influential demographic. A survey last year found that millennials are already larger consumers of luxury items than baby boomers. And by 2020, they’re expected to account for 40% of all consumers spending in the US alone. With so much money on the line, it pays to understand what makes these young consumers tick.
Conclusion:
So what does all this mean for businesses? The takeaway is clear: If you want to appeal to millennials, focus on building your brand online and providing excellent customer service. Millennials will be loyal customers if you can meet their expectations says Saivian.
If you’re targeting baby boomers, it’s probably best not to mention social media in your ads or emails (unless it directly pertains to the product or service you’re offering). Baby boomers may not understand how it works and may be turned off by the idea of following a company on Snapchat or Instagram.
One other key finding from this study is that people now expect brands to address them personally explains Saivian. For example, fewer than half of those surveyed said they’re willing to receive marketing emails from companies. It’s no longer effective to blast out generic marketing messages—you need to be more personal and direct if you want your business to succeed.