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Millennial consumers are harder to reach. Here's how utilities companies should adapt. Reuters/Chip East

Although the Millennium Bug (Y2K for the conspiracy fans) never amounted to much when it came to destroying financial systems, the same cannot be said for millennials. Ok, “destroying” is perhaps a bit strong, but “shaking to their very core” is probably accurate.

Young Americans have really done a number on the finance industry. Not because they are defaulting on loans, but because their habits are different. And by the year 2020, they will dominate the U.S. economy. According to Accenture, some 80 million millennials have now become the largest U.S. demographic. They spend around $600 billion each year, a figure set to increase as their financial freedom grows. In a report, Accenture predicts that their spending will hit $1.4 trillion — around 30 percent of retail sales — in a little under three years.

To take advantage of this spending power, utilities companies need to consider a number of challenges that millennials bring with them when it comes to exercising their considerable consumer strength. If utilities companies can get over these hurdles before competitors can, they’ll be onto a winning situation.

Harder to reach

Despite being so-called digital natives, millennials are surprisingly hard to reach. Sure, they might have smart phones jam packed with messaging apps but, when they are continually switching between them, they can be difficult to pin down. A lot of this comes down to ideas around time — i.e., they don’t have any. They don’t have time to answer your calls, they don’t have time to respond to your email and they certainly do not want to spend any precious minutes they do have shopping on unattractive websites.

Utilities companies must adapt to this desire to save as much time as possible. At present, many providers don’t even display their prices online or have the functionality of checking out online. This makes it all but impossible for millennials to do adequate research prior to being forced to call service providers — something they don’t want to do. All utilities companies need to consider how they can make their websites as user friendly as possible in order to get the attention of a demographic that is considerably more cagey about making contact.

Generation price shop

Now, there is a lot of thought that has been put into assessing how and why millennial shopping habits are different to those of Generation X and the Baby Boomers. Many attribute it to growing up in the shadow of the global financial crisis, putting considerable fear into young people about making unnecessary or expensive purchases. After all, from their point of view, financial security is not much of a certainty.

That’s why it comes as no surprise that 57 percent of millennials — at least according to research from Goldman Sachs — admit to comparing prices in-store. Armed with their various technological devices, it’s perfectly possible for young consumers to compare the prices on offer in any location. This trend is exceptionally important because, according to a report from Adroit Digital, for 62 percent of millennial consumers, the price point is the most important factor of making a purchase. They still care about brands, but it’s not a case of any old brand. Quality and name are not as important for this generation, who are more attracted by a good deal. Utilities companies need to keep in mind that they need to make the right offer, not just have a strong brand or reputation.

Time is money

So it’s actually not just that time is money, it’s also that millennials have incredibly short attention spans. It’s not a surprise really, though, what with an inundation of ads, online written and video content, and Netflix. In fact, if any millennial readers are still with us, they are to be congratulated.

If that sounds ridiculous, it shouldn’t. According to research from Microsoft, the average person now has an attention span of just eight seconds. So drastic is the situation becoming that the NBA is even considering a reduction in game length just to keep people tuned in to games until the very end. Bounce rates — how quickly people click off of websites — is through the roof. As a result, not only are millennials harder to reach, they’re also hard to keep. Companies need to stay interesting, and relevant, in order to appeal to this new breed of consumers as they move into the apex period of their purchasing power.

In order to get ready, the utilities industry can consider the following adaptations. Transparency is key — no more hidden prices. This promotes an image of authenticity with consumer experience at the forefront of a company’s mission. So, with that in mind, being upfront about pricing and especially rate hikes would be a good place to start. These are important attributes for millennial audiences and utilities companies need to keep that in mind. Lastly, investing in technology and making it easier to compare plans and subscribe online will make a huge difference to younger people, drawing in more customers and making utilities companies more friendly for this twenty-first century audience.

John Harlan is president of the startup company My Utilities.