Baby Boomers vs. Millennials: A Consumer Behavioural Comparison
The Consumer Behavioural model below, taken from Motherbaugh and Hawkins (2016), demonstrates the Decision Making Process. Consumers go through distinct buying phases when they purchase products (Tanner and Raymond, 2013).
Motherbaugh anf Hawkin (2016)
External influences of Baby Boomers and Millennials – A Comparison
A Different Era
The Baby Boomers were raised in an era of “extreme optimism, opportunity and progress”, with a “deep focus on personal fulfilment” (Schmidt, 2010). However, the Millennials were born into a far more pessimistic world. Despite this Millennials are the most diverse, most educated and the most cared for generation in history (Schmidt, 2010). However, the Baby Boomers benefit from financial stability and secure pensions.
Millennials are Digital Natives with the ability to adapt to new digital concepts quickly and easily.
Born Digital Vs Learn Digital
Now between 53-71 years of age, compared to the 22-37 year old Millennials, both these generation are active digitally. A major characteristic of Millennials is their high digital intake. They are digital natives with the ability to adapt to new digital concepts quickly and easily. It is often assumed that Baby Boomers were reluctant users of technology, however they are embracing it hesitantly. Recent studies have shown that Baby boomers spend more than 20 hours per week consuming online content, 10 hours more than the average Millennial (Morrison, 2015).
The way in which the content is consumed is strikingly different between the two generations. Boomers prefer laptops and desktops, whereas Millennials are in favour of mobile devices. While both are comfortable browsing, researching and shopping online, Millennials are more likely to use their mobile devices to do so (Business Insider, 2015).
Their online influences also differ vastly. 82% of Millennials heavily rely on word-of mouth from friends and family, and social media and blogs. At 52% this is substantially lower for Baby Boomers, as they are more heavily influenced by retail websites, advertising and sales people (Business Insider, 2015)
Internal Influences of Baby Boomers and Millennials – A Comparison
The internal influences can range from perceptions to attitudes. Attitudes are particularly relevant when analysing the decision making process. Attitudes can be defined as “A learned tendency to respond to an object in a consistently favourable or unfavourable way” (Onkvisit and Shaw, 1994).
The Elaboration Likelihood Model is a more effective way of analysing attitudes.
During a period of fast economic growth in the 70s and 80s, Boomers became career focused, were competitive with their peers and gained financial wealth as a result. Therefore, the baby boomers developed a respect of success, and used and continue to use status symbols such as luxury cars, watches and holidays to define their class (Hunter, 2012).
Application of Decision Making Process Model
Problem recognition occurs when we experience a significant difference between our current state of affairs and some desired state of affairs. In some cases, marketers can create a problem for the consumer by raising the consumers ideal state through marketing efforts. In the case of luxury, opportunity recognition is rife as consumers are exposed to better quality products (Solomon, et al. 2015).
Millennials and Baby Boomers both fall victim to opportunity recognition of luxury goods, however this is encouraged by different sources. Millennials tend to develop opportunity recognition as a result of observational learning through their peers, celebrities and online influencers such as bloggers and YouTube content makers. However, Baby Boomers are likely to develop this need through conventional advertising such as magazines, television or brand websites.
Problem recognition leads to information search. The nature of luxury products means in most cases, consumers abide by an extensive-problem solving process due to the price of the products, the lower frequency of purchases and the high involvement of the consumer (Solomon et al, 2016). Therefore, the information search is likely to be more thorough than habitual purchases.
Millennials are more likely to ask their peers for opinion look at the brands social media sites and read online reviews. A study by Goldman Sachs found that “When a brand uses social media, I like the brand more”- twice as more Millennials believe this statement than non-Millennials. Baby boomer however, are more likely to look at the brands websites and recall their past experiences. This is an example of instrumental conditioning.
Alternative Evaluation and Selection
At this stage, the consumer is ready to make a decision based on the information they gathered. For a Millennial, this is likely to be a long period of time of deliberation due to the high involvement of the purchase. A Baby Boomer may already have a favourite brand and the finances to support a more impulsive decision.
A study by Deloitte (2015) concluded that in luxury consumption, millennial are three times more likely to be driven by trend than older consumers. However, older generation such as the Baby Boomers are more likely to make purchasing decisions on impulse. This is likely to be a result of their stable income and comfortable lifestyle, and the ability to spend on themselves as opposed to their now adult children. Baby Boomers are therefore less motivated by price than Millennials and are more loyal to the styles and brands they like.
Outlet Selection and Purchase
Both Millennials and Baby Boomers enjoy making luxury purchases in store, however Millennials are more likely than Boomers to shop online.
Millennials are reluctant to use credit cards, and are more likely to save for a luxury product or use a financing option to purchase it. Baby Boomers are less reserved about using credit and enjoy a buy now, pay later mentality. The Baby boomer is likely to be purchasing a brand they’ve purchased before, with encouragement from conventional marketing activities. The Millennial is likely to be purchasing a brand that is on trend among peers, celebrities and influencers, and has shopped around for the best price.
The review stage is very similar for both generations. Both will form some degree of cognitive dissonance due to the compromise each generation of consumer has to make (Bose and Sarker, 2012). Post –purchase dissonance may be caused in Millennials due to the high financial risk. Whereas, the reduced research by Baby Boomers may mean the product is not as anticipated.
Due to the high brand loyalty associated with Baby Boomers, it is likely that if they are pleased with their purchase, they will continue to make purchases with the same brand. Whereas, Millennial may use word-of mouth and social media to inform others of their thoughts regarding the product.
Critique of Decision Making Process Model
The Decision Making model assumes that the consumer, whether they be Millennial or Baby Boomers, go through each stage of the decision making process. In the case of luxury, the decision process is likely to be heavily dependent on income as opposed to the generation. The wealthier the consumer is, the less time will be spent during the information search stage. Impulsiveness will increase as involvement decreases.
There are evidently many differences between the consumer behaviour of Baby Boomers and Millennials, however the research has shown some surprising similarities. Baby boomers are not as digitally unaware as marketers and brands seem to assume. It is important to note that the Baby Boomer generation and the Millennial generation are huge groups, with the younger half using digital technology significantly differently to the older end of the generation. Therefore, generalising the generation can fail to produce a realistic idea of their consumer behaviour.
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