Thanks to a still buoyant economy, multiple sources are projecting a healthy holiday season for retailers. And the latest report from PwC adds another credible voice to the chorus—and it also provides a well-versed take on how consumer groups are expected to behave, singling out one in particular.
PwC anticipates consumers will spend 5 percent more this year than last, but a closer look at the findings illustrates the role high-earning millennials could play in helping retailers close out the year in the black.
The firm’s 2018 Holiday Outlook report shows more than 92 percent of 23- to 36-year-olds who earn at least $70,000 plan to spend at least as much as they did in 2017, exceeding the 83 percent of the general population who said the same. Moreover, this millennial group is expected to spend $2,021 on average this holiday. In comparison, the average consumer has $1,250 budgeted, according to the survey, which polled 2,071 shoppers.
“Confident about the economy because they’ve experienced nothing but a bull market for most of their adult lives, millennials (aged 23-36) with annual household incomes of $70,000 or more are looking forward to a season of spending this holiday,” the report’s authors said.
Retailers looking to get a share of that wallet are advised to offer health and wellness products and services. Overall, that category is expect to experience a 9-percent year-on-year increase, and the study found that this millennial group in particular cares about this sector more than any other.
While these shoppers intend to allot $917 to gifts, travel will command a close second at $741. More than 60 percent have travel plans for the holidays, with adventure destinations, cruises and beaches topping their lists.
This group is very open to discovering new products and brands, so they’re always on the lookout. Seventy-three percent rely on friends and family to keep them informed about the latest things, and 64 percent admit they can be swayed by so-called influencers. For 62 percent, social media is a key way they engage with brands, even if just passively as a follower.
Amazon is also where these consumers turn for inspiration. In fact, 80 percent are Prime members, compared to 55 percent of their peers who earn less than $70,000. This alone puts these shoppers in a coveted category since, in general, Prime members are expected to spend $1,531 during the season compared to the $932 budgeted by non-Prime members. Prime folks also have been identified as early adopters of different fulfillment methods and payment options.
This is in keeping with the values of this shopper. “Typically working parents in large cities, these busy young professionals care about quality, convenience, and speed—sometimes more than price,” PwC said.
Whether they’ve been caught up into the Amazon ecosystem or not, high-earning millennials are twice as likely to pay with their smartphones as the average shopper. Plus, 41 percent are likely to transact via wearable versus only 16 percent of the general population. This affinity for tech also makes them target consumers for gadgets and wired devices, especially those that promise to make their lives more convenient.