Segments:

Millennials are typically defined as those born between 1980 and 2000. Given the generation’s 20-year
age span, millennials make up a sizeable chunk of the population.

Because millennials range in age from 16 to 36, they constitute a consumer segment that is of growing
value in most markets.

While many millennials have less money and financial security than older generations do, they are
typically in a high-growth phase in terms of their earnings. Millennials are in a life stage where they are,
or soon will be, developing their careers, moving up the professional ladder and settling down into
double-income households. So, year over year, their spending power will be increasing.

Demographic is significant not only due to its size and growing spending power, but also because its
consumer demands tend to differ notably from those of previous generations. While such a large group
is inevitably diverse and complex, there are nevertheless some identifiable millennial trends:

 They are highly adept at using technology and are very active social media users.
 They tend to be more socially conscious than older age groups, and are influenced by
product offerings marketed as ethical, sustainable or environmentally friendly.
 They are more likely than older age groups to focus on health and well-being in areas
such as food and physical activity.
 They are more concerned with value and bargain hunting, in part out of necessity, as
their economic opportunities have decreased.
 There is evidence that millennials are more interested in spending on experiences than
on possessions.
 Similarly, there are indications that some millennials are shifting toward renting instead
of owning belongings, from cars to clothes, although this may be influenced by the
group’s relative economic insecurity.
 Because they are often pressed for time, millennials are likely to be looking
for convenience, especially when shopping.

These preferences and behaviors are substantially affecting product and service markets worldwide, not
least because millennials’ spending power is increasing. Major brands and retailers need to adapt to
cater to the demands of this increasingly valuable consumer segment.

 Millennials’ growing importance to the global beauty market: Globally, the beauty
product market has the potential to double in value in the coming 10–15 years, a period
during which millennials’ spending power will increase.
 Millennials’ cross-channel approach to beauty shopping: The millennial generation
expects to have the same shopping experience in different sales channels and is driving
the convergence of new channels of communication, commerce and service.
 Changing beauty trends: Millennials’ beauty perceptions differ from those of older
generations—younger shoppers prefer living in the moment and not worrying about the
future, and they are more likely to buy all-natural cosmetics than older generations are.
Millennials generally like to use technology when making purchase decisions, and they actively take a
cross-channel approach to beauty shopping. Survey data show that millennials are much more likely
than older age groups to research their purchases, use technology to help them make shopping
decisions and use social media as part of the purchase process. At the same time, a majority of shoppers
of all generations say they prefer shopping in stores to shopping online.

According to L’Oréal, in 2015, makeup was the fastest-growing cosmetics category globally for the third
year running. The growth was largely influenced by millennials’ interest in taking selfies and sharing
them on social media.

Millennials are health conscious and often prefer buying organic and natural products when they are
available. This demand for natural products is also seen in the beauty category. According to a 2015
survey by natural skincare brand Kari Gran, women ages 18–34 are the most active buyers of all-natural
beauty products overall. Makeup was the only category in which the 35–44 age group showed higher
interest in buying all-natural products than millennials did.
Some of the largest beauty retailers and brands have identified how the industry is being impacted by
millennials and, to successfully remain in the game, they are investing in satisfying the needs of this age
group.

When targeting beauty products to millennials, it is important to remember several things: they like
doing research online, but still prefer to buy beauty products in-store; they value experiential retail
environments; they like natural and ethical cosmetics; and price is often a key purchase driver for them
when buying beauty products.

The beauty industry could witness its most significant transformation in the coming decade, largely
influenced by millennials, who will be the demographic spending the most on beauty. The generation
wants the same beauty shopping experience in-store and online, the chance to try and discover new
products, personalized services, and alternative product options that match their lifestyle. (The
Millennials Series: Millennials And Beauty, 2017)