The End of Brick + Mortar? Not if Millennials Can Help It - OZY | A Modern Media Company

The End of Brick + Mortar? Not if Millennials Can Help It

The End of Brick + Mortar? Not if Millennials Can Help It

By Constance C. R. White

Young women shopping
Sourcemichele liberti


Surprisingly enough, we may have millennials to thank for still having stores to shop at.

By Constance C. R. White

When Denise Mahoney, a 27-year-old New Yorker, goes shopping, she has her own approach, different from her parents. Instead of relying on what a big retailer suggests through advertising, she browses Pinterest, where she says she goes to see if there are any outfits she likes. 

But curiously, Mahoney hasn’t abandoned one old-school habit: going to stores. She still likes the browsing it offers, she tells OZY — she likes, in particular, the social experience.

Generation Ys like Mahoney are changing the shopping experience that all retailers once counted on: the idea that they could lure customers via frilly window dressings or persuasive advertisements. Instead, millennials — the group of young people now in their 20s and 30s — are forcing retailers to think hard about how to engage a new kind of customer, one more inclined to browse than buy, at least immediately. Young shoppers aren’t looking for the same cues their parents once did. They do their own research via organic sources, social media platforms like Pinterest and Instagram. This, along with their sharing mindset, means retailers have less control over their potential buyers’ browsing habits. 

Millennials will herald in a new experience-driven mall.

But an interesting part of those habits, it turns out, is still going to the store. Indeed, here’s the rub: most of the wisdom today has been that millennials will mean the end of brick-and-mortar stores. This trend suggests the opposite, that millennials will herald in a new experience-driven mall or shopping experience.

Millennials are also skittish from the recession. Saddled with student loans, they have less disposable income than they did pre-recession. And, they’re tech natives. “Their idea of material goods is not as important as experiences and relationships,” said Jamie Gutfreund, chief strategy officer for The Intelligence Group, which has studied millennials and is a division of Creative Artists Agency. It’s a trend that will impact how we shop and what stores will look like years from now. And, millennials account for 21 to 26 percent of the population but 33 to 35 percent of retail spending — in a market worth as much as $250 billion — according to Christine Barton, a partner at the Boston Consulting Group. They “punch above their weight in apparel,” she says — making them massively important targets.

For them, the store of the future is a place where you go to relax and “chill” or as a substitute hangout spot for you and your friends, an alternative to socializing at home. It’s called a dwell rather than a shop and “everyone’s jumping on the bandwagon now,” said Aria Hughes, an editor for the online trend forecaster WSGN. “It’s less about commerce first and more about engaging your consumer.” And while major brands are investing in the online experience, says BCG’s Barton, they’re also finding they have to make the in-store experience an “energetic and exciting” one. 

And here’s how it’s going down: Urban Outfitters created a larger store in NYC with several accoutrements that keep shoppers engaged in a range of activities from getting a haircut, printing out an Instagram photo to enjoying coffee with friends, all within the walls of the store; a shopper could have a total UO experience without ever making a purchase. A store in Tallahassee has a coffee shop; one in Los Angeles has an expanded music section, the company told OZY. 

“Millennials are a lot more concerned with brand ethos,” Hughes explained. “Boomers are more interested in abundance.” Theirs is the wham, bam, thank you ma’am of retail. Shopping done.

A lot of millennials are looking for something to share.

Aria Hughes, editor for online trend forecaster WSGN


At the new Kate Spade Saturday stores, shoppers can linger and socialize. Kate Spade introduced the store — like a high-end, hip farmers market — in Japan last year and has expanded it into the U.S. From the start, Spade been a social brand, appealing to millennials’ sharing pages online. A signature piece of merchandise is the Weekender — aimed at a younger, online-dwelling Kate Spade customer, the company confirmed to OZY — a customizable bag that invites shoppers to interact with the merchandise and personalize it in much the same way athletic brands started offering some customization of sneakers years ago. (The bag is available online or in the store.)

And how about Nordstrom, which has begun pinning footwear in its shoes department with pins that indicate the shoe’s popularity on Pinterest? That’s not all: Nordstrom’s also got a rotating themed pop-up shop in eight stores across the U.S., and a partnership with Like2Buy, which makes its Instagram account shoppable, says Nordstrom spokesperson Taylor Droddy.

Retailers want to create opportunities for shoppers to be social off-line as well as online. “A lot of millennials are looking for something to share,” said Hughes, noting young girls who show off their Forever 21 purchases online both as gratification and socialization. “So retailers are trying to figure out ways to foster transactions on social channels.”  

Free People, the apparel chain, and Sephora, the beauty retailer, are two that have created their own social media channels with some success. Then there’s Spring, a new mobile shopping app that Hughes says in her blog “feels like a shoppable Instagram” and allows you to follow up to 450 brands.

Whether innovation to meet the needs of Gen Y’s will happen quickly or at a more glacial pace is really the question. The need is there and the mandate of the next 10 years is to get better at selling to Gen Y as their buying power explodes.

And then there’s Generation Z.

They are the kids under 18 — and to hear Gutfreund talk about them, retailers will next be dealing with “sixth sense” shoppers for whom technology is like another limb. “What’s going to get to be important for this group is to be able to connect their virtual lives with their physical lives,” says Gutfreund.

Though maybe, surprisingly, that place where the virtual meets the physical is in a mall, after all.

Leslie Nguyen-Okwu contributed reporting.

Photography by Michele Liberti

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