Since the Covid pandemic, there has been much discussion about how physical and internet shopping have both returned to levels that few had anticipated. But many consumers—most notably millennials—remain predominately focused on online shopping.
New data from DTC e-commerce giant ESW shows that millennial consumers actually prefer online to in-store shopping.
More than 27 per cent of millennial consumers stated they will spend “much more online and less in-store” this year across categories like health and beauty, luxury, and clothes and footwear in the most recent Global Voices Survey.
According to the report, approximately 73 per cent of millennial consumers want to spend the same amount or more online in 2023. If their actual spending follows their present projections, this will make millennial consumers the leaders in global e-commerce for 2023.
“The millennial consumer remains fully committed to their preference for online shopping over physical retail,” said Patrick Bousquet-Chavanne, President and CEO, ESW Americas. “Millennials’ spending power has grown to US$ 2.5 trillion, and they are not yet even in their prime earning years. They are spending more online than in-store across several categories, and these results indicate that brands must continue to evolve, improve, and optimize their e-commerce to attract and retain this increasingly powerful demographic.”
More than 16,000 respondents across all demographics from 16 countries participated in ESW’s survey. It also looked more closely at customers who paid full price as well as “power shoppers,” or those who spent at least US $ 2,500 online in the previous 12 months.
Yet, consumers have returned to physical shopping over the past year, and those who do so appear to be spending more money per trip, even though foot traffic hasn’t yet fully rebounded in many areas. It indicates that physical retail is booming in important locations.
A difficulty for pureplay e-tailers who don’t have a physical location as a backup has been the reported decline in online sales, which has been observed by numerous retailers at the same time. So, it’s a huge opportunity since the millennial generation is more interested in e-tail than before.
According to ESW, millennials will boost their online spending on health and beauty items by close to 50 per cent more than Gen Z and by 42 per cent more than Gen X and Baby Boomers will do.
Almost 27 per cent of millennials, as opposed to 20 per cent of Gen Z, 22 per cent of Gen X, and 21 per cent of Baby Boomers, will spend more on luxury products online in 2023. And a staggering 77 per cent more millennials will increase their online clothes and footwear buying, making them the target market’s largest group.
In addition, we found that millennials will spend 52 per cent more on luxury goods than either Gen Z, Gen X, or Baby Boomers, if we look at power shoppers in particular.
Moreover, 29 per cent of millennial power shoppers will spend more money online on clothing and shoes than 21 per cent of Gen Z, 23 per cent of Gen X, and 27 per cent of Baby Boomers.
Also, compared to Gen Z, Gen X, and Baby Boomers, 20 per cent of millennials will spend more this year on full-priced footwear and apparel purchases made online.
Consumers from Canada, the United States, Mexico, the United Kingdom, Switzerland, Spain, France, Italy, Germany, South Africa, the United Arab Emirates, India, China, South Korea, Japan, and Australia were interviewed by ESW.