What are we to make of U.S. teenagers’ shopping preferences?

 

The teenage market is a lucrative market. At the time of writing, Justin Bieber has 50.9 million Twitter followers, which is 8.4 million more than US President Barack Obama. It’s also a knowably fickle market; teenage tastes change quickly. As Rob Lowe said about Justin Bieber, it’s nothing to do with his actual music– he just happened to be in the right place at the right time.

The teenage market is interesting for another reason, too.

Teenagers are digital natives in the truest sense. The rest of us merely adopted the internet, they were born in it, molded by it. The habits and practices of digital natives should be more indicative of what the future will look like, so anybody interested in doing any sort of business would do well to pay attention to these patterns.

So, kids, being digital natives, should be eager to adopt online shopping, right?

Well, here are the stats, according to Mashable + Statistica:

us-teens-shopping-online

1: Most of them still seem to prefer shopping offline.

Okay. What does that mean? How do we make sense of it? There are some questions worth asking, to make sure that we get the full picture on this.

2: Here are some questions worth exploring:

1: How does a teenager’s disposable income affect her shopping decisions? In the source study, it’s revealed that teenagers now almost equally prefer off-price retailers to regular departmental stores. This is evidence that teenagers (as a group) are more price-sensitive than adults (as a group), considering that they have less disposable income. So they’re more likely to be sensitive to pricing. They’re probably more likely to shop at thrift stores, for example.

2: What about a teenager’s access to credit cards? Teenagers don’t qualify for credit cards of their own, so they’ll either have to use pre-paid/debit cards, or ask to borrow their parents’ credit cards. Teenagers might not be comfortable with their parents being able to see just how much they’re spending on those signature leggings or distressed jeans (“You paid how much for jeans that are torn?!”). So that might be a barrier that’s keeping them from buying stuff online.

3: Need for social interactions in physical spaces? It may be that teenagers still have a strong preference for hanging out with their friends in physical locations (after school, for example). Feel like you’re growing up, coming into the world, you want to go into a store and pick something out. Also, it’s worth thinking about the accessibility that U.S. teenagers have to malls. There are a lot of malls in the USA– could this have an effect on teenagers’ perspectives?

But this is definitely a downward trend. See the source study: “Shopping frequency has declined from a peak rate of 38 trips/year to 29 trips/year (one every 1.75 weeks). We note Fall 2013 appears to have marked the low point at 28 trips. Our measure of trip frequency improved 2% sequentially, although still down 10% year over year. We estimate mall traffic in the teen space has declined 30% cumulatively in the last 10 years. It’s increasingly evident that teens are browsing more often via their mobile devices, shopping with purpose (conversion rates are up), buying when they have a real or perceived need, and visiting the mall less for entertainment value.”

4: How meaningful is the distinction between online & offline, anyway? While I was writing this, I noticed a friend on Facebook had gone to a retail outlet and taken several selfies of herself in a dressing room, wearing a different dress each time. Her friends debated in the comments about which dress she ought to buy.

While she may have ultimately bought the dress at an offline store, the fact remains that people are increasingly using digital to augment their experience of reality, and retailers that enable this process will win big.

3: There is some missing context that we need to think about:

What does this group look like compared to others? What are the preferences of adults?

A study of teenagers is interesting, but it’s not all that elucidatory by itself unless we’re also aware of the preferences of their older peers. What are we to compare these stats against? Are teenagers shopping online more or less than adults? What do those differences tell us, and how do we explain them?

I personally wouldn’t be surprised if adults prefer online shopping more than teenagers. A teenager may enjoy shopping with his peers after school, while a busy working adult may find it more convenient to shop online.

What does this group like compared to before? What are the trends over time?

If you look at the original graph again, you can see a pretty significant shift for male teenagers and a significant shift for female teenagers towards shopping online. Most teenagers still prefer to shop offline, yes, but this is changing pretty fast. The source of the graph, the Piper Jaffray ‘Taking Stock With Teens‘ study points out that “Over the past 13 years, we’ve truly witnessed two major shifts in shopping channel preferences and behaviors. First, the shift to off-price retailing is very real and not anchored simply in also-ran overstocks from the department store crowds… Second, teens are increasingly shopping online and on their phones.”

Implications:

I think that we can reasonably expect teenagers and everybody else to get progressively more comfortable shopping online. There are all sorts of things that will only accelerate this trend.

  • Perhaps bitcoin or some variant may become more ubiquitous, making it easier for teenagers without credit cards to make online purchases. We can’t guarantee this, but it’s a by-product of research and investment in these fields.
  • Shipping is only going to keep getting cheaper.
  • There are more online-only stores, and their products are looking more enticing, and their communities are getting more engaging and interesting. Ecommerce is a growing industry, more money and expertise is being poured into it.
  • People trust the process more now that so many other people are getting into it.

So I’m willing to bet that while the graphs may not look particularly impressive, the trend is going to keep shifting. Eventually most purchases will be online, or have a significant digital element (marketing, engagement) baked into it.

As the Piper Jaffray study concludes, “This does, however, indicate to us that brick-and-mortar retailers need to continue to invest in their sites and create frictionless shopping experiences in order to maintain this top-of-mind status among teens. Key to this strategy, we believe, is wrapped up in a mobile strategy.”

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