Here’s a mantra you probably heard a lot in 2012: Millennials don’t shop that much these days. They share instead. This was usually followed with multiple explanations about what makes these roughly 80 million Americans between the ages of 16 and 34 (aka Generation Y) unique and why they buy less and share more.
But is it true? The short answer is, apparently, no. The longer answer is that it’s complicated - although Millennials are certainly open-minded to the sharing economy, they are still very fond of buying stuff and haven’t really shifted from ownership to accessibility. In other words, Generation Y hasn’t abandoned shopping. Not yet, at least.
So why do we still hear this mantra time and again? It is mainly based on some data points, like the fact that “In 2010, adults between the ages of 21 and 34 bought just 27 percent of all new vehicles sold in America, down from the peak of 38 percent in 1985. “ In addition, you have some studies like the Zipcar Millennials survey supporting this claim to some degree. Last, but not least, it seems that this is a common view of people involved in the sharing economy.
Nevertheless, I think this claim is inaccurate. First, there are comprehensive studies showing Millennials actually shop as much as others. For example, the Boston Consulting Group, along with Barkley and Service Management Group conducted a study on the Millennial consumer, where one of the conclusions was that “in contrast to their reputation as a lazy, entitled generation, U.S. Millennials are actively engaged in consuming.“
“Don't believe the hype that Millennials consume less than previous generations,” said Christine Barton, a partner at BCG, “On average, U.S. Millennials already shell out and influence the spending of hundreds of billions of dollars annually—an amount that will only increase as they mature into their peak earning and spending years.”
More evidence can be found in the Regeneration Consumer Study which was released by BBMG, GlobeScan and SustainAbility last November. This global study presents four consumer segments on the sustainability spectrum, “from highly committed Advocates to style and social status seeking Aspirationals to price and performance-minded Practicals and less engaged Indifferents." Although these groups have different attitudes and values, Millennials have a similar share in all of them, - 26-30 percent. This finding shows the diversity of consumer values, motivations and behaviors among Millennials.
This piece of evidence is also important because of its global reach - we have a natural tendency to focus on the Millennials in places like San Francisco, New York, London and Berlin, but the future of this planet is growingly dependent on the Millennials in places like Shanghai, Mumbai and Rio. It’s not that we need to ignore the U.S. and Europe as they set the tone – what we need is to include everyone while portraying the big picture just like this study does.
We also have further evidence that Millennials are not necessarily more likely to participate in the sharing economy compared to other generations. Advertising and marketing firm Campbell Mithun found out in a national consumer study that “opinions of GenXers and Millennials aligned: 62 percent of both groups found sharing appealing. But surprisingly, more GenXers than Millennials found the concept “very appealing” (31 vs 24 percent).” The company’s director of strategic planning explained that “GenXers are in the thick of the giving years. With obligations to kids and mortgages, this stretched, practical group is saying the concept aligns with their needs.”
Even the Zipcar Millennials survey, mentioned earlier as one of the pieces of evidence supporting the claim that Millennials have embraced the sharing economy, shows Generation X has similar attitudes. Asked how likely they are to participate in media, car and home or vacation sharing programs, GenXers were very close to Millennials, 57% vs. 67% on media sharing, 45% vs. 53% on car sharing and 43% vs. 49% on home/vacation home sharing.
Beyond the surveys and studies there’s anecdotal evidence, which doesn’t have too much weight but still has some value. So here’s mine – I’m a Gen Xer, not a Millennial, so I can’t speak for myself but many of my students are Millennials and since we work in some classes on relationship to stuff and talk about the sharing economy, I can tell you a couple of things. First, Millennials not only buy stuff but also feel attached to their stuff just like older generations. Second, although they’re open-minded about the sharing economy, they’re also cautious about it and want to make sure it’s truly beneficial before fully embracing it.
Looking at all the evidence, I come to the conclusion that Millennials are very similar to the consumer segment Aspirationals described on the Regeneration Consumer Study. The Aspirationals are “materialistically-oriented while, at the same time, aspiring to be sustainable in their purchases and beliefs,” the study explains and describes this as a dynamic tension between material possessions and social and environmental progress. I believe that we can say the same about the Millennials – they too have the same dynamic tension between these two seemingly contradicting behaviors. Right now, consumerism still seems to be more dominant, but there’s definitely a possibility this balance will change in the future.
Raz Godelnik is the co-founder of Eco-Libris and an adjunct faculty at the University of Delaware’s Business School, CUNY SPS and the Parsons The New School for Design, teaching courses in green business, sustainable design and new product development. You can follow Raz on Twitter.