Money isn’t easy to come by. Especially when you’re young.
Thus it’s common for people in their early adulthood to be frugal. When there’s little money to spend, it’s necessary to spend wisely.
But today’s young adults -- the Millennials, or Gen Y, -- are exceptionally frugal. Unlike the two generations of young adults that preceded them (Boomers and Gen X), the Millennials are extremely tight with a buck.
That’s caused consternation among retailers and manufacturers.
But Millennials aren’t always thrifty. A look at Checkout TrackingSM data shows that members of Gen Y do tend to spend more when certain conditions are met.
- Millennials shop more frequently at brick and mortar, but they spend more money when shopping online.
- Millennials spend more than twice as much per receipt when shopping online in three categories: clothing, electronics and home/kitchen. (The gap is bigger for older Millennials than for younger.)
|Apparel & Accessories||$56.88||$70.58|
|Electronics & Accessories||$53.45||$66.10|
|Home & Kitchen||$46.37||$54.66|
Brick and Mortar
|Accessories & Apparel||$23.98||$24.19|
Three factors seem to drive these higher online spends.
- Minimum order requirements for free shipping
- The ease of comparing prices for higher ticket items online
- Easy return policies for items that often require returns, i.e., clothing.
“Millennials are learning to do more with less. And spending has become an art form. Understanding what is most likely to influence that spend is critical for success today,” said Marshal Cohen, chief industry analyst for The NPD Group.