Consumers, particularly older ones, are looking for discounts at the checkout counter, driven by the widespread discounting by mass merchants and department stores.
According to a survey conducted by technology provider First Insight, large numbers of consumers said discounts in department stores and mass retailers influenced their expectations for discounts in home electronics, appliances, furniture, smartphones and vehicles.
“The results of this survey indicate that the rampant discounting that has become the norm in department stores and mass merchants has had a clear impact on consumers and the way they now consider purchases in every aspect of their lives,” says Greg Petro, founder and CEO of First Insight. “Retailers need to be aware of these shifting expectations within their target audiences in order to compete, while still maximizing profits and sales.”
While discount expectations were similar across genders, Baby Boomers and Gen Xers were much more inclined to expect to pay less than full price. More than three-quarters (76%) of Baby Boomers, for instance, said they will not pay full price for home electronics, appliances, furniture, smartphones and vehicles.
Millennials, on the other hand, were less inclined to consider discounts in their purchase decisions. Fewer than half of Millennials said they would still consider purchases in all of those categories regardless of the option of a discount. Only 35% of them would be less likely to buy a smartphone at full price, according to the survey.
“The Boomers are wanting to be engaged in a promotional way,” Petro tells Marketing Daily. “Millennials haven’t had a chance to develop that relationship with all those components.”
The difference in expectations means retailers and marketers have to understand the definition of “value” for each of these groups, Petro says. For Baby Boomers, it means offering something special with a purchase (like a discount or extra), and for Millennials, it means understanding what products they can’t do without or offering something that’s unique.
“Millennials are willing to pay more for products they value,” Petro says. “The future of retail is unique product sets.”