As retail evolves to keep up with Millennial expectations, now Gen-Z consumers are impacting the market. This cohort craves both experiences and authenticity, complicating what brand need to do to keep up and stand out. An interesting interview that Jeff Fromm had with Maya Mikhailov, SVP Marketing at Synchrony, a company that is dedicated to helping retailers create strategic mobile programs that speak to the experiences and lifestyles, about her thoughts on how retailers can differentiate themselves.
Jeff Fromm: When you think about retail, what are the biggest opportunities for retailers to better meet consumers needs?
Maya Mikhailov: Once, retail was highly localized and curated to local tastes and interests. In the late 80’s and 90’s, it expanded rapidly, and all of a sudden there was this consolidation of tastes. Merchandisers who had to be accountable for their local markets now had to expand across the entire national chain. What was once local and personal became mass. Today, you are seeing retail go back to the roots of localization, personalization and experience. If you look at the malls that are being built around the country, they have changed into these communities and experience centers that are highly focused on entertainment.
Fromm: When you think about localization, personalization and experience, what do you think the future holds for best-in-class retailers? What do you think they will be doing in tomorrow-land that they are not doing today?
Mikhailov: First of all, they need to get the basics right. They have to be ready for an onslaught of a generation with Gen-Z that doesn’t know a world that is not digital first. In 2020, they are going to represent 40% of consumers. If you are a retailer that doesn’t have a digital strategy, or is still trying to put one together, you are going to completely miss out. The new brands that are coming up are not necessarily coming up locally, they are coming up on Instagram, finding niche audiences, attracting those audiences, and catering to them completely. Also, just understanding how you are going to be convenient to this next generation of shoppers.
They like experiences, but they are not necessarily patient to your supply chain problems. Having that convenience factor is going to be critical. For example, we know that Millennials and Gen-Z are obsessed with experiences over products. There is a reason why festival culture has become “the culture.” The concert tickets that 10 years ago would have been $50 a pop, are starting at $150. But now, you have to bring retail to the experience. A lot of retailers started doing that with Coachella, for example, and they are continuing to lean into that. They are bringing their retail experience to where the eyeballs are.
Fromm: How do brands start better meeting the needs of both a younger consumer and the older consumer if they don’t already have the equity in the kind of actions that Nike might have on topics like equality, or that Glossier might have on a kind Instagram niche audience?
Mikhailov: You have to find what is authentic about your brand. If what is authentic is price, then it’s price. I think that brands for try to run into this vanilla appeal so that they are not controversial and that they don’t really have a perspective. They have found themselves completely without a voice. I think the first thing they need to discover is what consumers care about. When you are looking at Gen-Z and Millennials, they want to care. Statistics are showing that approximately 67% of them want their brands to have a cause or social-orientated voice. Finding authenticity in a crowded market place is becoming increasingly important. It is not resonating to just be bland.