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The Generational Blindspot for SMEs
A new study from American Express has showcased a generational blindspot that offers huge opportunity for small and medium-sized businesses. The study explored the trends on SMEs and found that more than three-quarters of the small businesses don’t have a strategy to appeal to the Millennial or Gen Z market.
This can be considered as a generational blindspot as the market is set to grow and will contribute to a downfall for these companies. According to the study, 90 per cent of SMEs say they’re comfortable and secure with their business strategies. However, 60 per cent of those interviewed claim that their customers are now ‘demanding more tailored products and services’.
How Will This Affect Retailers?
Retailers who don’t have an effective strategy for the Millennial and Gen Z market have the potential to lose half of their customer base. According to the research, the combination of the two markets represents more than half of the Australian population.
While 60 per cent of these retailers don’t have an established plan to target the next generation of shoppers, it’s not too late to jump on the bandwagon.
“It’s all about knowing who’s looking at your business and buying your products and employing different marketing strategies based on what you learn. Making those stronger connections typically starts with data,” explained Martin Seward, the Vice President of Global Commercial Services ANZ at AMEX. “Though many SMEs don’t know where to start or view cost as a barrier, the good news is that today, technology that can help, is more accessible than ever and the longer-term benefits can be significant and well worth the upfront work and investment.”
Capturing the Next Gen Market
There are plenty of ways that a small business can capture the attention of the next-gen shopper. From social media to an ethical product listing, you can inspire Millennial and Gen Z customers to reach out to your SME and enhance the customer intake.
Strategic Channel Selection
As AMEX suggests, it’s essential to understand where your younger customer base is coming from. A myriad of shoppers prefer to make purchases online, so retailers must have a capable e-commerce site with mobile functionality to cut through and capture further attention. You can find Best Practice Guides here.
Personalisation is Important
Now so more than ever, personalisation is the key to ensuring a customer’s attention. The modern shopper isn’t interested in something that’s shoved in their face -they want a product that’s tailored to them and makes them feel like a person, not another sale. From emails to suggested products, there’s a plethora of tips and tricks you can use to maximise your personalisation method.
In a world surrounded by images, text and flashy marketing, it can be hard to stand out. If your brand is finding it challenging to achieve cut-through to the audience, don’t be afraid to throw something new into the mix. Do some research about the demographic you’re targeting and create something that can appeal to them. Of course, it’s a fine line between trendy and tacky, so roadtest the imagery and marketing with someone in the target market before letting loose.
The younger generation are all about transparency. They’ve grown up surrounded by influencers and celebrities pushing non-friendly or healthy products to their audiences, which stifles trust between retailer and customer. As many brands have seen, Millennials and Gen Z are quite forgiving if a brand makes a mistake, but the brand needs to own up and recognise the problem it’s facing. Another essential aspect to consider is if you make a mistake, you must learn from it. It’s okay if you own up to the problem, but if you don’t fix it, you might start losing customers.
Encourage User-Generated Content
Requesting reviews, posting images on social media and general word-of-mouth is a great way to encourage users to give helpful feedback and promote the brand to their friends. This encourages FOMO (fear of missing out) and the sense of urgency – they will want to get their hands on the product before it’s too late. You can keep it traditional by asking them to write a product review, or go one step further by suggesting they post the item on social media. If you choose the latter, offer an incentive by putting them in the running to win a prize. The next generation of shoppers are more inclined to write something if they get a gift in return.
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