Catering to cash-poor millennials

When retailers announce profit warnings or store closures, it’s often millennials who get the blame: ‘They value experiences over possessions’, ‘They spend all their money on avocados’ etc. In fact, millennials do want to buy things with their money – they just don’t have a lot it, enduring higher living costs, lower wages and worse job prospects than older generations did at the same age.

Considering that millennials will soon have the lion’s share of global spending power (over $20 trillion by 2020), it’s not surprising that brands are future-proofing by making themselves more accessible. We take a look at the big brands doing just that, and the game-changing companies helping them do it.

Try-before-you-buy
There’s been a lot of press about influencers returning clothes after wearing them once, but for the majority of shoppers, sending back unwanted purchases and waiting for the refund to hit their bank account is a major barrier to purchase.

Retailers have responded with try-before-you-buy services, allowing shoppers to order as much as they want and only pay for what they keep. Some brands, like Amazon and Alibaba’s Tmall, have developed their own services, while many more are working with third parties (of which Klarna is the most prolific, recently launching a high-profile B2C campaign).

You could argue that try-before-you-buy is the antithesis to sustainable shopping, decreasing the value of clothing and encouraging over-consumption. But as long as retailers adjust (not reordering stock until it has been paid for etc.), we think it will make shopping more sustainable; if people are 100% happy with everything they buy, surely they’ll send less clothes to landfill?

TryBeforeYouBuy

Slicing up payments
Digital-first companies like Afterpay, Splitit and Klarna (as mentioned above) allow users to pay in instalments for everything from fashion to tech. While catalogues have been used to spread the cost of shopping for decades, these new companies enable people to pay in instalments wherever and whenever they shop.

Partnering with big brands, these companies offer an alternative payment method at checkout, mainly online but increasingly in store too. Shoppers pay the first instalment and the item is delivered/taken home as normal, then there are three more instalments to pay (all interest-free, if paid on time).

There are ethical implications to making debt so readily available to young consumers, but it’s no different to offering customers store cards with large credit limits. We think this type of payment will gain traction throughout retail and beyond – in Nordic countries for example, Klarna is already being used to pay dentists, plumbers and mechanics.

SplitPayments

Leasing life
While it’s commonplace to rent homes, phones and cars, there’s huge potential in new rental markets like homeware and clothes. Why splash out on a new holiday wardrobe, for example, when you could rent the whole thing upon arrival? It’s already possible to lease luggage; why not go the whole hog and borrow a suitcase filled with clothes too? (Or better yet, get it dropped off at your destination and fly baggage-free.)

Millennials could soon be leasing furniture too, if Ikea’s new initiative takes off. The furniture giant has announced plans to lease kitchens, which it hopes will evolve into a scaleable subscription service.

This would be great for millennials, or ‘Generation Rent’, who are less likely to own a home and put down roots. It could help to make a rented flat feel like a home, and allow people to recreate their dream home décor, without having to pay for it all outright.

LeasingLife

Time to open up
Brands need to make themselves more accessible, either with subtle improvements (for example, online stores could pay refunds quickly, and run a pop-up to give customers an idea of fit and fabric) or with a more radical approach, Ikea-style.

Because in 2019, it’s not enough to assume that cash-strapped consumers want the cheapest product. Millennials are picky about what they spend their hard-earned money on; if they’re going to buy into a brand, they need to be confident that it’s worth their money – and that’s not going to happen if they can’t access the brand in the first place.

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Sean Dwyer

Just how radical is Natoora’s ‘radical seasonality’?

The opening of London’s second Natoora fruit and veg branch got us thinking about the seasonal retail model… and how to freshen up the concept of sustainability.

If we’re all completely honest, do we really know which fruit and veg are in season, and which aren’t? Asparagus in April? Courgettes at Christmas? The truth is that we’re all so used to getting what we want, whenever we want it – we’ve lost touch with the way produce is grown and sourced. And in this ever more environmentally conscious era, it’s an issue that’s not going away.Natoora2

A new way to shop
Enter Natoora. This growing brand is looking to change the way we shop for fresh produce. Now in three upmarket areas of London, Fulham, Chiswick and Chelsea (as well as supplying some of the UK’s top chefs and hosting concessions in six Waitrose branches), they’re on a mission to replace what the founders see as a broken, opaque food system. Natoora’s answer? A transparent and completely sustainable supply chain, using a rotation of small-scale suppliers, and only stocking seasonal produce.

Back to (revolutionary) basics
With the clever positioning of ‘Radical Seasonality’, Natoora is putting the focus back onto the true costs of farming. They invite their customers to stop thinking of four seasons, and recognise only three: early, peak and late. We love the revolutionary feel of this; while other brands are built on sustainability models, Natoora really owns it; they live and breathe it, right through to the shopping experience. Its stores, for example, showcase the fruit and veg in a way that feels exciting and new. Clean lines and geometric concrete-style architecture put the produce centre stage – the starkness of the grey highlighting the bright colours of the fruit and veg.Natoora3

Intelligent spot-lighting adds theatre, making each piece feel like a true work of art. Natoora’s ethos is to highlight the craftsmanship that goes into growing and farming – and this couldn’t be more evident in the stores, with provenance maps and stories (including info on how it shouldn’t be done) sitting alongside much of the produce.

Keeping it fresh and real
Perfection isn’t the aim here. There’s no plastic packaging keeping everything uniform, produce is haphazardly arranged, and there are slight imperfections on pieces of fruit and veg. Everything is there to remind you that these are natural products, supplied by small-scale suppliers.

So even if the concept of seasonality isn’t entirely radical in itself, the way Natoora presents it feels fresh and new. And in today’s busy commercial sustainability landscape, that’s a great thing for a brand.

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Sean Dwyer

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