Commentary

Millennial Spenders

Millennial Spending Habits, the group defined by the Pew Research Center as people born between 1981 and 1996, is often blamed for “killing” various industries and products, from casual dining chain restaurants and brick-and-mortar stores, to consumer staples such as beer, cereal, soda, and bar soap. 

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Research cites this generation’s well-documented financial troubles as a probable cause. Findings from an April 2018 survey by NBC News, and the GenForward project at the University of Chicago, found 62% of Millennials owe more in debt than they possess in their savings account.

Credit card debt is also very common among Millennials due to higher costs of living and shrinking disposable incomes; the same study found that ]46% had “significant” credit card debt. Student loan debt, too, is often cited, the average student loan debt for a college graduate today is $34,000.

Despite this, Millennials still spend a lot of money, and they’re quite unapologetic about how they choose to do so. From Uber to farm-to-table foods and premium coffee, the generation has preferences for what are traditionally more expensive products and services. This is particularly true for luxury items, including but not limited to, designer clothing, handbags, shoes, and jewelry.

Millennial Spending Habits 

To gather more insights and a greater understanding of how Millennials spend on luxury goods and services, The Pearl Source and Laguna Pearl, Los-Angeles based jewelry importers, and leading online jewelry retailers with 20 years in the pearl industry, conducted a research study involving 1,000 randomly selected Millennials across the United States.

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A 16-question poll, designed by market researchers aimed to dissect Millennial attitudes, spending habits, and preferences for luxury goods and services, were randomly ordered and delivered over a one-week period via email and phone. The sample group comprised of men and women from across the United States ranging in age from 22 to 37.

Millennial  Spending Habits – Income Demographics

Income Level

% Spending

$25K-%50K

31.7%

75K-100K

10.1

50K- 75K

14,4

<25K

29.4

Source: Pew Research Center, 9/2018

 

Participants By Employment Status. 

Millennial Spending Habits – Employment Demographics

Employment

% of Respondents

Employed for Wages

52.9%

Homemaker

13.7

Self employed

7.8

Student

8.8

Military

0.7

Unemployed

12.7

Source: Pew Research Center, 9/2018

 

Nearly 70% Of Millennials Surveyed Stated They Took On Debt(for the purchase of a wedding and/or engagement ring; 35% of those respondents needed 6-12 months to pay off that debt, while 9% stated they were still actively working to pay off that debt.)

 

Debt for luxury

Payback

32%

1-6 Mos

35

6-12 Mos

22

12-24 Mos

Still paying

9%

Source: Pew Research Center, 9/2018

 

Millennial spending power, having officially overtaken spending powers of Baby Boomers, are all the more important to understand for both traditional and online retailers. Though Millennials have certainly been a difficult group for these retailers to understand, the willingness of millennials to spend money to maintain a certain lifestyle (which includes luxury items), as indicated by this research, is very promising.

Conclusion; Millennial Spending Habits, Research results indicate that this generation still puts a high value on luxury products and services. Despite the debt they carry, there was a clear willingness to forego spending in other areas in order to obtain luxury items like jewelry, designer clothing, handbags, and travel experiences.

More About MillennialsMay Be Found Here

 

 

 

 

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