Big tickets, no problem
More than two-thirds of younger millennials, those 18- to 26-years old, plan to make at least one “considerable” purchase before the end of this year.
The data, from Bankrate.com’s August consumer survey conducted by Princeton Survey Research Associates International, underscores the huge importance of catering to this group.
When asked how likely they are to spend on either furniture, a TV, a smartphone, a computer, an airline ticket or a large home appliance before the year end, 68% of the younger millennials indicated they are “very likely” to make a purchase in at least one of those six categories, the Bankrate.com survey found.
By comparison, just 49% of consumers overall said they planned a considerable purchase this year. (Still, even that percentage is a potentially encouraging sign for retailers. Bankrate.com said its Financial Security Index, an indicator of consumer confidence, in August hit its third highest reading since it began conducting that study in 2011.)
Including those aged between 27 and 36, 58% of the total millennial group in the spending survey indicated they will very likely open wallets for at least one big-ticket item.
Not surprisingly, millennials skew higher when it comes to planning on a smartphone purchase. Some 19% of millennials plan to buy a smartphone before the end of the year, the survey showed, compared with the national average of 13%.
The survey also adds evidence to a trend that many retailers have said is a key challenge with millennial shoppers: their taste for spending on experiences over material things. When it comes to what they plan to spend money on, a quarter of the millennials said they will spend money on an airline ticket before the end of the year, above the other five categories, according to the Bankrate.com survey.
That millennial focus on experiences can also be seen in a recent CreditCards.com survey, which found that 36% of millennials said they have paid for gym memberships in the past year, two times the level as those who are older. (CreditCards.com is a unit of Bankrate.)
While Gen Xers, many of whom are parents, skew higher than millennials when it comes to spending on sporting events and athletic equipment for themselves or their families, the percentages of millennials’ spending on those experience-related things also are higher than the national average, the CreditCards.com survey showed.
