Franchise Update Magazine Issue II, 2015 | Page 28

CONSUMER MARKETING

Millennials
Millennials Value Value

Balancing price with quality and experience
BY ADAM PIERNO

M

illennials, especially the younger
half of the demographic, came
of age during the Great Recession. As they entered the job market,
they experienced hard financial times that
limited earning opportunity for many. College graduates suffered high unemployment rates, and a large number have been
forced to move back in with their parents.
According to Pew Research Center, 36
percent of all Millennials live with their
parents, 45 percent are unemployed, and
18 percent have a college degree.
They have learned how to make do
with less discretionary income and fewer
extravagant luxuries (save their technology.) As the economy has rebounded,
unemployment levels have receded but
attitudes haven’t exactly changed. The
Millennials we surveyed still behaved
with an eye on budget and on tools for
finding the best deal. In short, they are
extremely price-sensitive.
As franchise concepts work out an
offering, this fact must remain front and
center. In the current environment, there
is an overabundance of choice for consumers in every category. The savviest
among them all are the Millennials who
will find ways to get the best deal on
similar products or options.
But, the “best deal” does not always
mean “the cheapest.” Think about the
number of places you could get
a hamburger today. McDonald’s
has the highest awareness and is
arguably the cheapest option (or
at least among the cheapest
and most available). But
Millennials are avoiding McDonald’s in large
numbers despite its more
affordable offering.
In several studies we recently conducted, when asked
to rank drivers in food and purchasing
decisions across a number of categories,
Millennials consistently selected price
as their top consideration. However,

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in our dining-specific study, Millennials
told us that quality trumps price when
factoring both head-to-head; this means
they are doing a more complex type of
comparison to get to a ratio between price
and other key factors.

The Millennials
we surveyed still
behaved with an
eye on budget and
on tools for finding
the best deal.
In short, they are
extremely
price-sensitive.

How to balance your offering
1. Don’t compete on price if you
can’t win. It’s tempting to get pulled
into a price battle, knowing that price is
a key driver of traffic. But very few operations can deliver something great at
that lowest price point. As we know, this
experience with a customer is your best
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