Millennials have been described as narcissistic and entitled: wimps raised by helicopter parents, trophy kids who receive rewards not just for winning but simply for participating in an event, and a group that lives in a digital world instead of a real one.
“They are the most misunderstood generation that has ever existed,” says Jamie Gutfreund, chief marketing officer for Noise/The Intelligence Group, publishers of the Cassandra Report, which provides forecasts and insights on the youth market.
Gen Y is the most technologically savvy and educated generation to date. They are the first global generation—a group equally affected by news abroad and at home; they embrace other cultures, crave travel, and search for authentic experiences rather than material gains.
They are notorious browsers, they shop anywhere and anytime, and they interact with brands—sometimes on a daily basis. Yet items sit in their online shopping carts; they don’t seem to need the validation of a purchase. What do retailers need to know about this critical demographic?
Even if they’re not buying it, they’re coveting—and pinning—it. This Bulgari amethyst, rubellite, and diamond necklace ($79,000; bulgari.com) represents the ultimate aspiration jewel.
Millennials continue to evolve and particularly so in the luxury segment.
Unlike previous generations that gravitated to the “it” bag or brand-name object, millennials generally view luxury as something they do for themselves, not to impress others. “After the recession, they got used to not needing a bunch of stuff,” Gutfreund says. “They are contending with fewer jobs and a higher student debt than any previous generation, and they have yet to build credit history. If you pin a Bulgari [piece on Pinterest], you’re in the know. You don’t necessarily have to buy it.”
Millennials have a quirky relationship to ownership.
When making a decision to purchase a big-ticket item, they give a lot of thought to its resale value. About a third of those surveyed by the Cassandra Report in 2013 said they had sold big-ticket items on sites like Craigslist within a six-month period. Almost half of them expressed an interest in renting high-end goods they need for an occasion, rather than paying full price to own them. They also think long-term, however, and are willing to spend more on investment pieces than on fast fashion or costume jewelry.
“Luxury is relative to their income bracket,” says Gutfreund. “A pair of Dior double-sided earrings in the mid-$400s is a luxury item for many millennials. It’s got great resale value, is a classic, and makes a statement.”
Millennials are no strangers to renting, from gowns to jewels. For $392 per week ($1,412/month) at Haute Vault, you can rent these Oscar de la Renta blue diamond and blue topaz drops.
Labels matter—but not just for the label’s sake.
Millennials carefully consider brand reputation as well as their peers’ experiences with the brand. They also look for transparency, demand authenticity and ethical business practices, and respond particularly well when brands can tell a story or relate an item’s provenance.
Millennials expect to be heard.
Sometimes called venture consumers, millennials want to contribute both creatively and financially to brands they believe in. And this is true not only for small brands but for international brands as well.
“They think of themselves as consultants,” says Milton Pedraza, CEO of the New York City–based Luxury Institute. “It’s not a one-way conversation. As a result, we’re seeing that millennials are far more willing to share data with you.”
LVMH brand Kenzo (a Gen Y fave) opened the doors to its Paris workshop in summer 2013, giving select consumers a peek into its inner workings. (Hero Images Inc./Alamy)
Invest in multichannel marketing—but don’t count out brick-and-mortar.
This generation responds extremely well to personal contact at the brick-and-mortar level, even as technology increases our social isolation. Baby boomers do research online and then go to a physical retail presence to buy the item. Millennials do the reverse. They will head to a store for an experience. “Fundamentally, human needs have not changed,” Pedraza says. “The way people go after them has changed. Human beings matter a lot, and relationships matter more than ever.”
A version of this story originally appeared in the October 2014 issue of JCK magazine.