As the most populous generation in the United States, with 73.2 million people in 2022, millennials are a dominant cultural force and have an annual spending power of $2.5 trillion.
CouponFollow, a real-time coupon search engine, released the third edition of its Millennial Shopping Habits Trend Report this week, which analyzes the spending and saving habits of Americans between the ages of 25 and 40.
Since its last report in 2019, there have been significant changes in the way that millennials shop.
“Events such as the COVID-19 pandemic and the increased usage of social media platforms have greatly influenced how millennials approach spending and saving,” says CouponFollow President Marc Mezzacca.
The popularity of new payment methods, such as cryptocurrency and Buy Now, Pay Later options are also responsible for a shift in spending habits.
“Our goal with this report was to revisit how these factors have impacted e-commerce trends and how millennials, as America’s largest generation, continue to shape the future of retail and e-commerce,” Mezzacca says.
Findings show that millennials (80%) now do a majority of their shopping online -- up 20% from 2019. Over half of their online shopping happens on mobile devices, which is also up 20% from three years ago.
The study shows that among the 1,257 U.S. millennials CouponFollow surveyed, 73% changed how they shop due to the pandemic. More than half (56%) shifted their shopping online away from physical stores, especially among older members of millennials (35-40 years old).
Saving money and finding deals is still the most important factor in millennials' online shopping (63%), but a smooth checkout process (42%) and product recommendations (22%) are significantly more important in 2022 than they were in 2019.
As 78% of millennials now follow brands on social media (up from 57% in 2017), more than half (54%) say their shopping habits are most influenced by Facebook (28%) and Instagram (27%).
Although it only launched in America in 2017, TikTok is already the main social media platform shaping the shopping habits of 12% of millennials. For younger millennials aged 25-29, that share is 16%.
As the awareness of cryptocurrency grows (96% aware, up from 90% in 2019), so is the inclination to spend it when shopping online. One in three millennials made at least one purchase using cryptocurrency in the past year (+8% since 2019).
Finding the best deals and saving the most money remains the most important driver of shopping decisions among millennials (63%, up from 57% in 2019), followed by customer reviews (47%, up from 42%) and free shipping (43%, slightly down from 44%).
“Although millennials are leading the pack when it comes to online shopping, brands have to be even more aware of this generation's desire to find the best deal to entice them to spend their hard-earned money,” Mezzacca says. “As factors such as social media and other technological advancements continue to impact the lives of this technologically savvy generation, brands must pay close attention to these trends and shift their ecommerce strategies accordingly to innovate effectively.”