Post-Millennials, the experience economy boom will keep on truckin'

The trend of spending money on experiences instead of things may have started with Millennials, but it's poised to continue for many generations to come.

A study by Contiki shows that young people are continuing place more importance on experiences than ever, with 50 percent of interviewees aged 18 to 35 saying it was a defining trait of their generation. They said their money is increasingly being spent on festivals, entertainment, and travel, instead of retail experiences.

Millennials may have kick-started the trend to spend money on experiences rather than things, but their younger counterparts are going to carry on the trend for years to come.

Those aged 18 and under are set to dwarf Millennials in spending power.

They number over two million globally, giving them the spending power of $44 billion in the US alone.

This means despite currently lacking the purchasing power to buy what their parents accrued in their lifetime - such as the flash house, car and a boat – the up-and-coming generation will be extremely affluent.

Contiki surveyed more than 5000 people around the world and found those of a younger age are keen to spend their dollars on experiences such as gigs, festivals, attractions, entertainment, and travel.

This may be because they see experiences as a better economical investment than material goods.

Well over half (79 percent) of respondents said economic challenges are negatively impacting on their generation – more so than environmental, cultural or political.

This means it’s a great time to trade in experiences, such as hospitality and tourism, and a slightly more difficult time to trade in retail.

But it’s not all doom and gloom, either.

The majority of post-Millennials said social experiences were the most important type of experience, and shopping is becoming an increasingly social activity.

Social experiences ranked ahead of cultural, culinary, intellectual, adrenaline and spiritual experiences.

Shopping centres such as NorthWest mall and LynnMall are creating living and dining hubs within their retail precincts to cultivate more of an experience for shoppers, while savvy retailers are tying in experiences to their shops.

Examples include Auckland’s Nike Britomart store, which hosts a run club, and Barkers High St, which has a coffee shop and the Groom Room salon.

Nike's Britomart store.

The other route retailers can head down is making their store a destination by engaging customers’ senses.

Crafting this unique experience could be anything from using smell (shoe store Ziera experimented with making its own scents) to sounds (Paper Plus has a personalised radio station) to the visual décor.

The top ten other traits identified in the minds of young people by Contiki were:

  1. You believe in equality
  2. You think experiences are the most important thing
  3. You want to make a difference in the world
  4. You actually read books
  5. You believe in peace
  6. You believe in multiculturalism
  7. You believe in a healthy body and mind
  8. You think you can achieve your dream
  9. You cannot understand why accepting the LGBT community was ever an issue
  10. You’re not afraid to take risks.
This story first appeared on The Register.