The Millennial Dilemma : Adapting Payments for a Generation Expected to Earn Less
Any conversation about millennials is bound to mention their undeniable penchant for digital technology. Often considered as the first true digital natives, the generation born between 1981 and 2000 has become more or less completely dependent on the all-powerful smartphone.
Millennials across the continent have owned up to their dependency. British, Dutch and Italian millennials all agree they couldn’t live without their smartphone, only the Germans fell below 60% with 54% agreeing.
This unquestionably disruptive and ever increasing jack of all trades has cast a dark cloud over industries inapt to change.
However, no stranger to innovation, the payment industry, previously transitioning due to the e-commerce boom, has been churning out solutions to ease with the switch over to what is becoming an increasingly mobile world of payments. And all this has been done to please an increasingly fickle and picky customer base with less disposable income. It may be true that millennials are quick to blame generations of past for their economic situation today, but the fact remains companies fighting for sales have to work even harder to prise away hard earned millennial money.
This trend is not only apparent in Europe, with US millennials also having less income at their disposal. A recent study, conducted by a team of professors from Harvard, Stanford and Brown universities, examining income earnings across generations in the US showed that only 50% of people born in the years ranging from 1980 to 2000 will earn more than their parents.
However pessimistic the future may seem, it only gives companies more reasoning to optimize all aspects of their business. Here are some tips to adapt the payment process to millennial consumer behavior.
1. Security without the hassle
Convenience is at the heart of every millennials desire for new technology, but the expectation that security won’t be sacrificed goes without saying. This is why the adaption of security features based on the behavioral patterns from country to country must be considered to optimize both mobile and traditional e-commerce conversions. A recent case study touching on this issue, demonstrates how Ankama, the French video game developer, decided to refocus their payment strategy and use a single PSP, instead of several, to manage and adapt payments across the globe to great success.
2. Keep your finger on the pulse of social media
Millennials love nothing more than to rate and review products, not to mention they trust reviews and user generated content more than any other demographic. With this in mind, brands should be gauging the opinion of millennials across social media to get an idea of how they feel about their products. Conducting sentiment analyses on social media will give you an idea of how receptive the launch of your new product was, or what people thought about a recent event.
3. Prioritize development
Mobile is not always the answer, millennials may be the most adept to change but everyone has habits. For example, 55% of German millennials have never even tried using mobile payments. Not only is it important to understand the millennial consumer by country but also by industry. Groceries are one example where 70% of German millennials actually prefer to use cash!
4. Speed is top of mind
The time in which it takes to make a payment is paramount in the eyes of the millennial consumer. A survey asking European millennials in Italy, Netherlands, Germany and Britain showed that more than half of the millennials in all four countries would like to make payments instantly! Considering the convenience smartphones offer no one can be bothered with lengthy payment processes and long loading times. Think about the use of numeric keyboards in the place of alphanumeric keyboards when clients are entering credit card numbers and of course vice versa when typing in first and last names. All this goes without saying that continuing to optimize the mobile payment experience is key!
5. Preparing for the future
There is no other generation more willing to test out new technologies, thus staying aware of new payment methods is key to attracting those early adopters. The evidence shows that millennials are already thinking about the future of payments. The same survey on EU millennials showed that 42% of Dutch millennials would prefer to use their fingerprint to pay through mobile and that 42% of German and British millennials agreed they would use eye scans to verify payments. With a slew of payment methods set to take advantage of these new technologies and millennials undying curiosity for them, ensuring your payment offers match this demand is integral to keeping up in the future.