University students’ shopping habits may be changing faster than older generations, but with fresher’s week just gone, retailers may want to reconsider their strategies in targeting studious consumers. And there are several reasons why.
For 2019, student discount and jobs site Save The Student found that 79 per cent of 3385 surveyed university students worried about “making ends meet”.
Student life is already dominated by weekly living costs and course-related annual fees of over £9000. But with sustainability and second-hand fashion becoming increasingly trendy with millennials, retailers have an opportunity to tap into a demographic that is often overlooked.
Since Asos was recently crowned by social network Campus Society as the “best communicator” when it comes to engaging with university students, retailers have started to see this as a wake-up call to find ways in becoming more student-friendly.
Apps such as Pouch, UniDays, Grabble, Totum and Student Beans already offer a platform of discounts for students, so retailers should ask whether discounting is enough.
Julian Fisher, chief executive of information service Jisp, said students don’t just demand discounts, they expect them.
“Retailers have to find additional ways to attract their meagre spend,” he told Retail Gazette.
“Rewards for their loyalty or reductions in everyday goods are the key drivers to lure students in.”
However, Fashion Retail Academy lecturer Helen Farrington argued that students of today were “not just focused on discounts”.
“They expect quality merchandise, choice, free delivery, transparency of production and sustainability and community,” she explained.
Meanwhile, Alex Rohloff, co-founder of payment platform Laybuy, said discounts were a just gateway to students. He said there needed to be more to the offering.
“Understandably, people love a discount,” he told Retail Gazette.
“So, it’s quite hard to offer students anything less than a universal discount on an ongoing basis to retain them as loyal customers.
“Innovation and simplicity are attractive to students”
“Retailers could offer limited bespoke packages or experiences to make customer relationships more personal, rather than just transactional.
“Topshop on Oxford Street is a great example of this in action. It has a full-on salon on the bottom floor, which is quite a well-targeted and interesting technique to intrigue people enough for them to come inside, as opposed to coming in purely to spend money.”
“Retailers should invest in being more omnichannel and making store experiences ‘Instagrammable’,” she said.
Thanks to mobile technology giving consumers instant online access, retailers can deliver a multi-channel experience in order to reach students – regardless of how and when they want to spend.
Moreover, as students become more tech-savvy, retailers such as Asos, Ikea and Argos have invested in AR and VR technology in their customer experience offering to appeal to the wider market. While the technologies have been successful, it’s hard to determine whether it’s enough to attract students.
Simon Brennan, European vice president at software firm Engage Hub, said AR and VR were often “adopted as innovation for innovation’s sake”.
“High street retailers need to ensure that any new technology integrated isn’t merely a novelty, after all, most students just want technology to help them shop better, cheaper or quicker,” he told Retail Gazette.
However, he added that “innovation and simplicity are attractive to students”.
Farrington added it was likely that students would eventually lose interest in AR and VR, and retailers should instead invest more in customer experience. She highlighted how athleisure retailer Sweaty Betty did just that, by offering in-store exercise and yoga classes.
Despite this, Student Beans head of youth insights Jessica Pinkett said “technology cannot be ignored”.
“Eight of the 10 favourite brands in our Youth 100, as voted for by 16-24 year olds in the UK, are tech companies,” she explained.
“Any retailer that wants to have a successful future in this demographic should seriously consider investing in new tech innovations, such as AR, VR, voice and visual search.”
Brennan said retailers can use social media to their advantage as it would keep them relevant.
“Social media has proven to be one of the best tools for advertising to students, as well as to 18-to-24-year-olds more generally,” he said.
“Students want to engage with retailers that are innovative and invest in inspiring content”
“With an expanding global student population of 200 million, retailers are all too aware that students not only have immense spending power now but are likely to evolve into the high earners of the future and standing out in a saturated market is proving challenging.”
Meanwhile, Rohloff acknowledged it was logical for retailers to prioritise online sales due to the wider shift towards shopping this way.
“While there is a lot of work to do to ensure that online stores are fully functional, optimised and accessible for everyone, they still typically offer a better customer experience than physical stores,” he explained.
“The omnichannel experience must therefore be uniform and consistent.
“On the flip side however, the beauty of shopping in-store is that if you find an item you like, in your size, then you can take it home straight away.
“When making purchases online, no matter how brief, there’s always going to be a delay between the point of purchase and the time you receive your items.”
It can be argued that a reason why Asos was crowned as “best communicator” by Campus Society could be down to its convenient next-day delivery and simple refund service.
In addition, Asos often updates its trends to remain relevant among millennials. On top of that, it offers student discounts.
Campus Society founder and chairman Rashid Ajami said Asos was “a great example of a retailer that has moved to reduce its traditional advertising spend and instead invest in technologies and platforms that will enable it to have a better, more connected relationship with its customers”.
He concluded: “Students want to engage with retailers that are innovative and invest in inspiring content.”