To what extent is the consumer behaviour of Millennials different to that of previous Generation X in the area of luxury goods? Individual assignment by David Dorr (15617783)


The aim of this study is to examine the consumer behaviour of Generation Y in comparison to it’s previous Generation X. More precisely, it focuses on the Millennials’ attitude in terms of luxury goods and how their behavioural characteristics affect their decision making and purchasing process. For this purpose, this paper is divided into four different section. First, it briefly compares the two above-named generations. Second, it analysis the Millennials as consumers and highlights their digital interaction. Third, those behavioural traits will be specifically investigated in terms of luxury brands and goods. Finally, a consumer behaviour theory model will be applied and reflected in regard to the Millennials profile.

Generation X versus Generation Y

Generation X is used to refer to people born between 1965 and 1979 (Espinoza and Ukleja, 2016, p.6; Schiffman and Wisenblit, 2015, p.330). This generation is influenced by a range of events that took place during this period of time, such as Persian Gulf War, AIDS, corporate downsizing, a tripling of the divorce rate and both parents working (Espinoza and Ukleja, 2016, p.6). Hence, this generation is stated to represent a generally „high level of scepticism and cautiousness“ (Visit Scotland, 2016, p.3).

Generation Y, or Millennials, is used to refer to people born from 1980 to 2000 (Espinoza and Ukleja, 2016, p.7; Goldman Sachs, n.d.). However, some authors such as Schiffman and Wisenblit (2015, p.329) only include people born until 1996. This subset of society has grown up by the advances of digital and mobile technology (Fromm and Garton, 2013, p.9). They are influenced by globalisation and yet the first group who is stated as being „ethnically and racially diverse than previous generations“ (Elite Daily, 2015). Hence, apart from national culture aspects, Millennials globally tend to be more alike to one another than prior generations (Stein, 2013). Since digital technology and technology-based social networking has become an inherent part in both their working and private life (Espinoza and Ukleja, 2016, p.7), it makes them a „well-connected“ generation (Elite Daily, 2015).

For Millennials, digital technology and technology-based social networking has become an inherent part in both their working and private life (Espinoza and Ukleja, 2016, p.7).

Millennials as consumers

As stated in the previous section, the usage of digital technology has become a second nature for Millennials, as they grew up with computers and mobile devices. In terms of consumption, they are used to price comparisons and researching for reviews of others online (Goldman Sachs, n.d.). According to eMarketer (2013), almost one out of two Millennials (45%) spend at least one hour per day on retail-oriented websites. Due to their digital driven affinity, they tend to use their devices even during shopping. As stated by Fromm and Garton (2013, p.64), their smartphones have become a personal assistant in terms of their purchase decisions. To avoid any wrong decision, Millennials are likely to check their trusted online networks before making a purchase (Goldman Sachs, n.d.).

Unlike prior generations, due to their highly connected living conditions and technological habits, the Generation Y does not consider traditional media in the first place nowadays. Since their childhood has been accompanied by traditional marketing messages, Visit Scotland (2016, p.2) states them as „immune“ to those conventional advertising approaches. Instead, Millennials are used to personally relevant promotions (Schiffman and Wisenblit, 2015, p.329). In this context, recent research shows that less than 3% of Millenials would rate traditional media such as TV, magazines and books as their preferred sources for their purchase decisions. Instead, one out of three Millennials prefers blogs as their place to go to collect information on a product or service (Elite Daily, 2015). By doing so, generally, consumers tend to be more extensively in their researches (Jansson-Boyd, 2010). Further, it is more likely for Millennials to ask an online expert (17%) to assist their decision rather than get influenced by TV or magazine. In fact, one in 100 participants would be convinced to trust a brand more after seeing a traditional advertisement (Elite Daily, 2015).

Overall, due to this shift in information access and communication, the Generation Y is stated as a „tough crowd to impress“ (Visit Scotland, 2016, p.2). Since they barely get influenced by traditional media advertising, brands need to approach these younger customers in a different way. In this context, when one thinks of Millennials and their daily use of digital and mobile technology, the link to brands’ social media presence can be established. According to Fromm and Garton (2013, p.9), historically, customers rarely participate with a company in terms of product development or in any part of the marketing process. Nowadays, however, brands and companies take part in different types of social media networks and offer different ways to let their consumer participate with the brand (Schiffman and Wisenblit, 2015, p.30). In fact, this approach is stated as a crucial aspect for Millennials to interact with a brand, since they expect companies to let them hear their opinion and make a „significant impact on their favourite brands’ strategic decisions“ (Fromm and Garton, 2013, p.15).

Generation Y is stated as a „tough crowd to impress“ (Visit Scotland, 2016, p.2).

Millennials as luxury consumers

Generally, the previously mentioned traits of Millennials demonstrate numerous parallels to their customer behaviour in terms of luxury goods. Although this generation forms the smallest age group of luxury customers with 19%, they do have their impact in the way of how luxury brands communicate and offer their products in the digital sphere (Deloitte, 2015, p.7, 23). Typically, European luxury consumers take notice of luxury brands in magazines, however, it is the Millennial who gradually evolves the shift to online. 72% of them state a social media presence, again, as a crucial aspect for engaging with luxury brands and their products. In comparison, one out of two people of Generation X (51%) agrees with this statement. The reason given for this is the expectation of „how brands in general are communicating nowadays“ (Havas Media Group, 2015). According to Goldman Sachs (n.d.), twice as much of Millenials (34%) as other generations agree on the statement: “When a brand uses social media, I like that brand more”. In fact, the majority of luxury brands (85%) engage with their customer on social media platforms nowadays (Deloitte, 2015, p.18). However, it is the Generation Y who they actually target the most engagement with since their open-minded attitude builds a „great resource“ for brands (Fromm and Garton, 2013, p.13). Consequently, the majority of Millennials (58%) tend to purchase a luxury good once a brand publishes related content on the internet and, furthermore, the majority of them (62%) is likely to become loyal customers once a brand engages with them online (Elite Daily, 2015).

Interestingly, however, when it comes to the actual purchase experience, both the Millennials and Generation X still state physical stores as their preferred way to buy luxury goods. According to Havas Media Group (2015), among Millennials almost one out of three persons (29%) state shopping online as their favoured method, whereas only 19% of Generation X agree on this. Respondents stated a lack of technical competence by luxury brands as the main reason for not purchasing online in the first place. This is why both generations rather would buy luxury goods in physical stores (44% of Millennials versus 50% of Generation X). Nevertheless, in terms of purchase decisions, there is another factor apart from either shopping in-store or online. Generally, Fromm and Garton (2013, p.147) state the Generation Y as willing to spend money but, eventually, „they want a good deal, and will often buy luxury goods off-price“. Hence, the price is stated as the key aspect they consider the most. Moreover, the large majority of Millennials choose the lowest price as first or second criteria in their decision making process.

Fromm and Garton (2013, p.147) state the Generation Y as willing to spend money but, eventually, „they want a good deal, and will often buy luxury goods off-price“

Link to decision making theory

As stated in the previous paragraphs, it can be assumed that Millennials have a different attitude, strongly influenced by their media use, when one speaks of their decision making process. In theory, there are three different types of decision behaviour depending upon product price, the frequency of purchasing, consumer involvement, brand familiarity and research requirements. In this case, the above-mentioned process can be linked to a certain type of consumer decision models, namely the „extensive problem-solving behaviour“ (Solomon et al., 2016, p.328).

Generally, this model can be applied for expensive products since luxury goods are commonly perceived as high-priced. However, this perception may vary from person to person due to several reasons such as „purchase intentions and post-purchase satisfaction“ (Schiffman and Wisenblit, 2015, p.136). Hence, a high-priced product might be perceived more or less expensive depending on each individual. Moreover, there is no clear border between what is a frequent and infrequent purchasing, i. e. one person might state a sports car as a lifelong dream, whereas the other persons might be able to afford different sports cars regularly. Further, this behavioural model is based on high consumer involvement which, consequently, leads to an extensive researching progress by evaluating different factors. In this case, Millennials are used to research at different online sources before a purchase is made. Furthermore, since this generation expects an engagement with brands and it’s products before a purchase, they are not likely to follow any traditional advertisements and make a decision before they did not get involved with their selected brand through an online experience (Solomon et al., 2016).

To conclude, the findings show that luxury brands should clearly underscore both benefits and reasons to Millennials and offer their extensive engagement with this generation in a personal way. Therefore, luxury brands need to take into account purchasing behaviour of the Generation Y to maintain and enhance their own position not only in the luxury market itself but through the online channel as well.

Reference List

Deloitte (2015). The luxury opportunity. [Online]. London: Deloitte LLP. Available from [accessed 25 March 2017].

Elite Daily (2015). Millennial Consumer Trends. [Online]. Elite Daily. Available from [accessed 25 March 2017].

eMarketer (2013). How Millennials Shop Online. [Online]. eMarketer. Available from [accessed 25 March 2017].

Espinoza, C. and Ukleja, M. (2016). Managing the Millennials: Discover the Core Competencies for Managing Today. 2nd edn. Hoboken, New Jersey: John Wiley & Sons.

Fromm, J. and Garton, C. (2013). Marketing to Millennials: Reach the Largest and Most Influential Generation of Consumers Ever. 1st edn. New York: AMACOM.

Goldman Sachs (n.d.). Millennials Infographic. [Online]. Goldman Sachs. Available from [accessed 25 March 2017].

Havas Media Group (2015). LuxHub focus: Luxury super brands still dominate for luxury consumers, with 64% preferring them to niche luxury brands. [Online]. Havas Media Group. Available from [accessed 25 March 2017].

Jansson-Boyd, C. (2010). Consumer Psychology. 1st edn. Maidenhead, Berkshire: Open University Press.

Schiffman, L. and Wisenblit, J. (2015). Consumer Behaviour – Global Edition. 11th edn. Harlow, Essex: Pearson Education Inc.

Solomon, M., Bamossy, G., Askegaard, S., and Hogg, M. (2016). Consumer Behaviour - A European Perspective. 6th edn. Harlow, Essex: Pearson Education Inc.

Stein, J. (2013). Millennials: The Me Me Me Generation. [Online]. Time Inc. Available from [accessed 25 March 2017].

Visit Scotland (2016). The Luxury Generations - A short journey into their heart and pockets. [Online]. Edinburgh: Visit Scotland Insight Department. Available from [accessed 25 March 2017].

Report Abuse

If you feel that this video content violates the Adobe Terms of Use, you may report this content by filling out this quick form.

To report a Copyright Violation, please follow Section 17 in the Terms of Use.