Retail Minded

Getting to Know the Real Generation Z

By: Jeff Cheal, director of personalization, Episerver

Millennials are one of the nation’s largest generations, allowing them to bring a new set of priorities and expectations to the table. Not only that, but they’re setting the stage for how the next generation will make purchases and interact with your business. Companies are consistently trying to “crack the code” to determine who millennials really are and what they want – with mixed results at best.

However, millennials may (finally) be old news in the eyes of marketers.

Brands are preparing for the impending next wave of consumers on deck: Generation Z. How can they learn from Gen Z experiences to stay ahead of the game?

The Gen Z Factor

While marketers are quick to define Gen Z exclusively by their age (starting birth date of 1993), there’s more to this powerhouse of true “digital natives” than meets the eye. Some simply label them as screen addicts, and these types of generalizations are leading many to underestimate the impact this young generation will have on businesses.

Research shows that by 2020, Gen Z will account for nearly 40 percent of all consumers and influence about $4 billion in discretionary spending. From shopping habits to channel preferences, Gen Z is differentiating itself from previous generations – and it’s time to start paying attention.

What Gen Z Really Wants

Marketers need to learn what Gen Z really wants by examining the brands they interact with. It pays to pay attention. Brands that are reaping the benefits of learning from new interaction trends are those developing more meaningful brand engagements.

Gen Z shoppers may be young, but they are far from naive when it comes to the types of experiences they expect from brands. Above all else, they value authenticity and quality. Although price and convenience still matter, brands can’t win over a Gen Z consumer on those aspects alone.

While other generations see price as the most important factor for brand loyalty, Gen Z holds firm to the idea of quality. According to a report from Yes Lifecycle Marketing, 57 percent of Gen Z consumers consider quality to be the most significant driver of brand loyalty. Brand standard, such as the use of high-quality products or promoting sustainable practices, matter to Gen Z and will have a significant influence on their spending habits.

To gain a deeper understanding of who this generation is and how to engage with them, brands must also keep these insights top of mind:

  • The more information, the better

If Gen Z is anything, it’s well-informed. This tech-savvy generation has a knack for information. They’ve grown up with access to information constantly at their fingertips. Let’s just say, they didn’t use a card-catalog system at the library during their lifetime nor hear the sweet dial-up noise of AOL. Still, they both value and take for granted that they can conduct research and compare prices in fast and convenient ways.

With more information and options at their disposal, Gen Z wants more than just a good deal. Brands need to showcase their perceived value instead of relying solely on offering the lowest price. What really matters to Gen Z shoppers are factors like product quality, free shipping, brand prestige and unique engagements through multi-channel opportunities (in-store, social media, etc.). They’ll pay a premium for products from a brand they feel a connection to and trust. If brands want to attract these influential consumers, they need to deliver consistent experiences across all touchpoints.

  • Experiences come first

Digital experiences are important, but they won’t get companies far with Gen Z if they aren’t both personal and meaningful. In fact, 50 percent of Gen Z consumers say they will stop visiting a website that doesn’t anticipate their needs, likes or wants. It’s not enough to display someone’s name or wish them a happy birthday when they visit your site – personalization needs to provide capabilities to help customers feel a connection with the brand and deliver a more convenient shopping experience. This can be done in a variety of ways, including saved shipping addresses, personalized recommendations or one-click purchases.

The demand for unique experiences goes beyond digital channels. For one in five Gen Z customers, in-store experiences play a huge role in brand loyalty. Yes, an online presence is important. However, Gen Z shoppers in Yes Lifecycle Marketing’s study still consider a brand’s website to be just as important as what the brand offers in store. Ready to take advantage of Gen Z’s affinity for omnichannel? Create a seamless cross-channel experience by making sure personalized offers can be redeemed both in-store and online. One way to do this is by enabling customers to access their online profile in an in-store kiosk, this allows a shopper to easily re-order or continue product research from their online session.

  • Pay attention to outward marketing channels

Traditional marketing strategies may not have what it takes to fully capture the attention of Gen Z. This generation continues to gravitate toward social media and brands are starting to build experiences to suit the channels capturing the attention of Gen Z. Platforms like Instagram and Snapchat make it easier for consumers to interact directly with brands, and in turn those companies can deliver unique, immersive experiences. Publishers such as Buzzfeed and Teen Vogue are cashing in on the communal aspect of social media that keeps Gen Z coming back for more. Both companies are steadily increasing their number of average engagements on Instagram by posting relatable memes or encouraging followers to tag a friend.

From sponsored posts to lifestyle videos, brands are using their social channels to deliver relevant content that goes beyond showing off a product or service. For example, a beverage company can show its social awareness by taking part in cultural events or multimedia campaigns. Brands that showcase their unique voices and personality via social media, such as Wendy’s and Charmin, are leaving a lasting impression in the minds of Gen Z consumers.

Lifestyle brands share new and unique ways to use their product to improve day-to-day life. This content is not an infomercial – successful examples are typically spiritual, casual and tell the bigger story. When it comes to Gen Z consumers, it’s not just about a brand’s product or service – purchasing is closely tied to how they view the brand’s product or service in the context of their lifestyle.

Gen Z is setting a new tone – one that varies significantly from the generations that have come before it, but strategies to reach Gen Z can also be effective for other audiences. Marketing strategies for Gen Z tend to focus on their connection to technology and desire for a multichannel approach, which can appeal to all shoppers, regardless of age. Gen Z is the future, and catering to them is the best way to future proof marketing programs.

Jeff Cheal is the Director of Product Strategy for Personalization, Campaign & Analytics at Episerver. He has an extensive background in advertising sales, software and marketing strategy. He is based out of New York, serving the North American market as an ambassador for the Episerver product suite, staying connected with both the partner network and customer base.

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