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Got Luxury Products? Target Millennials

Illustration: Net Vector / Shutterstock

Now is the time for cannabis brands to prioritize and engage millennials with long-term, luxury aspirations in mind. The consumer group born between 1981 and 1997 is poised to be the next great luxury cannabis consumers. Millennials grew up in the age of cannabis normalization, which has shaped their acceptance and use of the plant. According to New Frontier Data’s recent report “Millennials as Cannabis Consumers: Attitudes & Behaviors of America’s Largest Generation,” 38 percent consume cannabis — nearly 10 percent higher than the next-closest demographic (Gen X) — with 46 percent of those set to increase their consumption in the past year.

Beyond their consumption rates, several attributes make millennials a prime target for luxury cannabis offerings. The generation has a high employment rate, consistent earning potential, and many non-traditional jobs — social media influencer, for example — that could be considered cannabis-friendly. They’re the first consumer group luxury brands have a chance to establish lifetime relationships with as they build disposable income.

Returning to the report, millennials’ purchase preferences, spending, and frequency are also revealing. Compared to other generations, they are the most likely to obtain their stash from a brick-and-mortar store (35 percent) and the least likely to obtain it from a family member (26 percent), a decision possibly driven by desires for niche products and informative labeling. Millennial consumers are the most likely generation to spend $200 or more per purchase.

They’re also more diverse in their product selection and the ways they match products to their lifestyle, using various forms of cannabis depending on the activity they engage in (66 percent), the time of day (31 percent), and where they are (15 percent).

New Frontier Data

Even though normalization is still being defined, millennials were more likely to report participating in curated cannabis experiences. Their choices could be connected to desires to consume away from home and to seek out experiences where cannabis is welcome and consumed freely as a way to enhance the experience.

New Frontier Data

These factors combine to make millennials the most promising market for luxury cannabis products.

While millennials are primed for luxury cannabis, most won’t consistently adopt the products without encouragement. Luxury brands must engage the cohort with compelling products and messaging to capitalize on this opportunity.

First, build products around lifetime relationships with millennials who are loyal to products with which they identify. Tailor products to the specific experiences that match the effects they desire for their typical activities. Ensure those products offer something unique that differentiates them from other brands or products.

New Frontier Data

Second, take special care when devising targeting and messaging strategies for consumer outreach. Millennials get bombarded with lots of info, and brands must cut through the noise. As Fleur Marché cofounder and Chief Executive Officer Ashley Lewis pointed out at the Luxury Meets Cannabis Conference (LMCC), “There needs to be a fundamental shift in strategic thinking about communications. [Brands] need to start talking to customers as if [they’re] a beauty brand or lifestyle brand, not a cannabis-first brand. The first point of entry needs to be talking about the benefits… What will this do for you?”

This closely aligns with New Frontier Data’s research, which shows 67 percent of millennials choose products based on the effect brands claim the products will create.

As the first generation to come of age with the internet, millennials are savvy enough to leverage online research to determine whether brands align with their personal values — so make sure your messages and products resonate on a personal level. It’s also critical to ensure consumers understand what makes the product “luxury” and why they should be willing to pay a premium.

As Elle and Town & Country contributor Emily Dougherty, who has covered the luxury health and beauty space for twenty-five years, said at LMCC, “Right now, you have a very prime consumer who isn’t necessarily as obsessed with price point. She’ll spend $500 on a Dyson blow dryer; she’ll spend $200 on an Augustinus Bader serum and maybe save elsewhere, but she is okay spending more on things she knows work. She wants you to meet her where she is.”

New Frontier Data

Understanding who the consumer is, making a product that meets their needs, and then engaging them with messages that both inform and entice are critical tactics for success at any price point, but even more so for luxury products where consumers must be willing to pay a premium.

Millennials represent the intersection of the first generation to come of age with some form of legal cannabis in the United States and may be the last generation to interact with commerce in a traditional way, enabling them to embrace cannabis in closer accord to traditional commerce than as an underground vice. Their characteristic position as full-time employees (half among them at a managerial level or above) provides them with disposable income, allowing them to be less cost-conscious and opt for products that more uniquely align with their experiences. Millennials’ cannabis use is purposeful and efficient, intended to enhance daily activities like health, wellness, and beauty as well as less-common experiences such as attending concerts or spa treatments.

Millennials are poised to be the next luxury cannabis consumers, and brands would be well-served to engage them as such right now to create long-term loyalty.

By Gary Allen

Originally published at https://mgmagazine.com/business/marketing-promo/got-luxury-products-target-millennials/ on September 6th, 2022.

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mg Magazine

mg Magazine

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mg is a monthly business magazine covering the recreational and medical cannabis business, meeting growing demand for business news and information.