The Generation Gap Redux

By Jeff Weidauer

Retail marketers have something new to keep them awake at night: the changing face of the American shopper that's well underway. Those changes are fraught with challenges we couldn't have imagined 25 years ago, largely due to the entry of mobile connectivity as a shopping tool.

It's the emergence of mobile that's really widened the gap between millennials and their parents, who are often baby boomers. Overall, boomers still tend to shop brick-and-mortar stores more frequently, especially during the holidays. They're more likely to review the piles of catalogs that show up in the mailbox every day, clip coupons and make purchases in-store.

Millennials, on the other hand, are prone to do research online before leaving the house, and any trip to a physical storefront is likely an effort to get a look at the real thing before ordering it online, sometimes while still in-store. Social media is a critical part of the shopping process as well; peer reviews and recommendations and feedback from friends — all in real time — are as important to these shoppers as price.

For retailers, the challenge is clear: there's a need to appeal to both generations without alienating either of them. Jumping too quickly into a digital-only experience that caters to millennials is to walk away from a piece of the $3 trillion buying power that boomers still wield. However, catering only to boomers doesn't work as a long-term strategy. Boomer spending will slowly decline as millennial incomes and discretionary spend increases.

J.C. Penney has become something of a case study in this shift. Ron Johnson, the company's CEO, came from Apple and is largely credited with the success of that brand's retail stores. J.C. Penney has been in the news a lot recently, and not in a good way, because of some of the changes Johnson has implemented in a quest to modernize and appeal to millennials.

The problem J.C. Penney has (unlike the Apple stores) is that its shopper base is almost exclusively boomers (or older). Unlike a more youth-oriented store (e.g., Apple), doing away with the trappings of old-school retail also meant shooing away the shoppers who were comfortable with that atmosphere. Unfortunately, this change happened before J.C. Penney was able to sell its hoped-for new clientele on how cool it was.

The greatest challenge in bridging the gap — or at least straddling it for the short term — is taking a cold, hard look at possible options and their likelihood of success. Picking on J.C. Penney again, turning an old-line clothing retailer into a hip outlet is a stretch to say the least. Apple's retail stores succeed in large part because of the passion its employees have for what they sell and the aura of cool those products are surrounded by. T-shirts and shorts don't, and likely can't, engender this type of loyalty, passion or coolness.

For any given retailer, there are three possible roads to take when considering the necessary changes for addressing the generation gap:

Stick with baby boomers because they're a loyal base, and that's who is most likely to continue shopping with you.
Move to millennials. This requires a solid base to start and can't be done by hiring some kids and creating a Facebook page. Much like viral videos, just exactly what constitutes "cool" is nebulous and constantly in flux. If you're not there now, this isn't really an option.
Chase both markets. This is the best answer for most, but also the most complex. It will require doing many things twice (e.g., paper coupons and Facebook coupons), while refining the process each week.

The typical retailer will be best served by observing its core shopper base and learning what they respond to, regardless of the generation they hail from. That's one thing that's not new, and if nothing else should offer some level of comfort to those sleepless marketers.

Jeff Weidauer is vice president of marketing and strategy for Vestcom International. Jeff can be reached at jweidauer@vestcom.com.