You may not know much about the Millennials, but know this: they’re coming for you. Well, more precisely, they’re coming for your products and services. If, that is, you understand their wants and needs. Just who are the Millennials, why do they matter so much and what does all of it mean for the home improvement market? We’ve got the scoop.
Getting to Know the Millennials
2015 has been a big year for the Millennials, AKA the generation of people born between the early 1980s and the early 2000s. Not only are they poised to once and for all usurp the title of “largest living generation” from the Baby Boomers — 75.3 million compared to 74.9 million — by year’s end, but they’ve already claimed the largest share of the American workforce. More than a third of the country’s workers are Millennials and this number is only predicted to rise in the years ahead.
With all of this working comes some serious purchasing power: Beginning in 2017, Millennials will spend approximately $200 billion annually adding up to $10 trillion over their collective lifetimes. But getting in on the payoffs doesn’t just involve giving them what they want. It also involves understanding how they want it. Figure this out and you’ll bump to the front of the line when courting the dollars of this tech-savvy, social and mobile generation.
(Don’t get us wrong: The Baby Boomers still matter, and what’s coming up for them in the years ahead is also huge. How huge? Every day between 2011 and 2030, a whopping 10,000 Baby Boomers — people born between 1946 and 1964 — will turn 65, and many of them will be renovating, moving and upgrading. What are they looking for? Well, that’s another blog.)
Millennials and the Home Improvement Market
There’s lots of talk out there about Millennials. Some of it’s even truth. But some of it misses the mark, like the misconception that Millennials prefer renting to buying. Sure, between living though the recession and some significant barriers to entry — such as establishing credit, saving for a down payment, high student loans, and and unstable job market — they might have been slow to the home ownership party. Others might be ready to make the leap, but unable to find what they want at a price that suits their budget. In either case, homeownership rates among Millennials are trending upwards, and financial and real estate experts agree that the time is right for Millennials to start settling down.
Five Things All Home Improvement Businesses Need to Know About Millennials
A Better Homes and Gardens survey on home buying and home improvement reveals some useful insights about Millennials. Here a five things you need to know:
1. Nearly a third of Millennials prefer full-on “fixer-uppers” to homes in need of only slight repairs. Why? Well, these homes come with more appealing price tags, but that’s only part of the “big picture.” Millennials also want their unique fingerprints on their living spaces and homes which reflect their personal style and design aesthetic. Buying a fixer-upper lets them get in on the ground floor, in a manner of speaking.
2. Millennials like to entertain, and are looking for homes which support this lifestyle preference. While they may not want or need all the upgrades, they do have some deal-breakers: 59 percent said they’d use extra kitchen space for a television over a second oven while 43 percent said they’d convert a living room into a home theater. Guiding these preferences? Millennials are less about having lots of space — bye-bye, McMansions — and more about purposefully using the space they have.
3. Millennials are all about technology. In fact, 41 percent of Millennials would find a home automation system more boast-worthy than a new kitchen. A full 77 percent, meanwhile, had technology on their list of must-haves for home purchases.
4. Green is a favorite color of Millennials, in more ways than one. Outdoor living spaces are big, with 35 percent of Millennials hoping to work on outdoor living or entertaining areas and 42 percent wanting to add exterior upgrades like decks, porches and patios. Millennials also buy into curb appeal with more than half planning to update their landscaping.
But “green” is also an imperative: 40% of Millennial hope to make energy efficiency improvements, and they are committed to supporting ethical and sustainable products and services.
5. They’re ready. Of the Millennials surveyed, a full 45 percent said they were in the process of planning or have already undertaken a home improvement or decorating project, with 75 percent focused on furniture and accessories. Meanwhile, 35 percent strongly agree that “now is the right time to spend” on home improvements.
One last thing to keep in mind when factoring Millennials into your business strategies for 2016 and beyond? We’ve already covered how Millennials feel about advertising. These feelings are amplified when it comes to the financial and emotional investment involved with buying or renovating a home. Ultimately, Millennials don’t just have a vision, but they also have the confidence that they can bring it to life. To that end, they’ll go into home ownership and renovating projects prepared with everything from Pinterest boards to swatch styles all aimed at being part of the collaborative process. Welcoming their contributions — and their need to contribute — will go a long way toward gaining their business.