As millennials progress into their prime spending years, businesses are shifting to accommodate millennials’ preferences.
This is consistent with a recent ICSC study that reviewed millennial spending patterns and future expectations. Millennials are loosely defined as being born between 1980 and 2000 and their preferences consist of health consciousness, concern for the common good, yearning for individuality, flexibility and experiences. These preferences are starting to appear in economic reports, specifically consumer expenditure reports.
ICSC’s report found:
- In the U.S., millennials allocated more than 12% of their expenditures to health goods and medical services during 2012, and this figure is projected to increase to 15% by 2022. More startling, this is five times higher than the global average for millennials. And, individuals and professionals along the Gulf Coast market believe the percentages are modest for this region and could be even higher.
- Why is it important? Globally, millennial households will spend 171% more in 2022 than they did in 2012.
- By 2022, the U.S. millennial household will have an average expenditure of approximately $124,000 with roughly one-third spent on groceries, restaurants, leisure and recreation, health goods, and medical goods.
- According to the study, income gains will drive the increase in expenditures, ultimately making U.S. millennials the biggest spenders amongst the millennial demographic globally.
These findings are important because they confirm that millennials’ spending is driven more by experiences (leisure, recreation, dining) and health rather than material items. This presents an opportunity for businesses geared towards experience and health, which is why we are seeing an increase in healthy, fast-casual restaurants, organic grocers and fitness clubs. As millennials progress into their prime spending years, businesses are shifting to accommodate millennials’ preferences. Developers are seeking health focused and experiential tenants to align their projects in order to capture the new spending trends.