John Taylor at ClearPay looks at the evidence suggesting millennials are rejecting traditional forms of retail consumer credit.
ClearPay, in partnership with leading global insight company Prescient, has released the results of its latest research into millennials, uncovering a generation intent on creating new ways to pay.
The research, published in the white paper Millennials and Retail Payments, reveals that many members of this generation show a strong emotional connection to shopping, with most recalling feeling excited and happy at finding that must-have item and that they use shopping to lift their mood.
For some, this creates conflict with their ability to afford the purchase and manage their finances, and they often experience feelings of guilt post-purchase.
Many are acutely aware of their pay cycle and how their capacity to spend is reduced mid-month as they wait for payday.
This means those who actively manage their finances have to time their purchases accordingly or settle for what they can afford at the time, rather than what they really want.
What millennials want
These shoppers are demanding a different take on the traditional customer journey with its interest-bearing credit, long terms and complicated application forms.
“Online experience is also an important driver to where they shop online, with easy and fast experiences highly valued and many respondents citing ‘one-click’ checkouts as their preferred payment method”
The research reveals it is control, very short-term interest-free credit on manageable amounts, and a fast and frictionless customer experience that tops millennials’ payment wish list.
Online experience is also an important driver to where they shop online, with easy and fast experiences valued highly and many respondents citing ‘one-click’ checkouts as their preferred payment method.
Given that most millennials – particularly those aged 18 to 25 years old – shop online using multiple devices, the need for smartphone and digital transaction journeys is considered essential to this audience.
Millennials are the largest consumer segment in the UK and it is vital retailers align their offering to meet the needs of this customer.
Addressing the gap in the UK retail sector
The research is unambiguous.
For those retailers looking to offer clear market advantage they should look at offering a new way to pay.
“Millennials are calling out for more flexibility in their payment options”
Millennials are calling out for more flexibility in their payment options and UK online retailers can gain an edge on the competition by offering this age group a new way to pay.
Specifically, they want a solution that delivers the freedom of interest-free credit agreements without locking customers in to long-term credit agreements.
In return, retailers will be rewarded with higher than average transaction values, increased frequency of purchase, and will become the number one choice over competitors.
The opportunity to fill the gap in the UK retail sector now exists – what are you waiting for?
John Taylor, digital marketing and group brand director at ClearPay
The independent research into UK millennial consumer shopping habits and payment preferences was conducted by Prescient on behalf of ClearPay. Read in full by downloading the free white paper Millennials and Retail Payments.