by Dave Howard, Global Marketing Director, Retail at global technology enabler, Intellias
The continuing fascination with Generation Z – or Gen Z – consumers may be leading to a very narrow definition of the cohort that may not serve the brands that are targeting these younger consumers. If only Gen Z consumers were easy to define and predictable in their shopping habits. Arguably, the cohort of consumers born between 1996 or 1997 and 2010 and 2020 – no one can quite agree – are the hardest to read and reach because they are a product of the world they have been born into, one where change is constant, frequent and often surprising.
Making hard and fast statements about Gen Z is risky
Among the many influences on their behaviour has been technology because they have grown up with fixed and mobile screens. It is assumed that they are more adept at using the technology in their hands and that this facility will inform their consuming behaviours. Mckinsey refers to Gen Z’s “seamless and intuitive adoption of online shopping and transactions.”
This much is known; however, this single insight may already have led to simplified assumptions about how to sell to Gen Z or Zoomers.
Bear in mind that some are already valuable consumers while some are still at school, so putting them all in the same bucket is difficult, particularly as those still at school are sure to alter the assumptions already made about their elders.
World events have made them question what their parents told them even more deeply. They study different subjects, according to Talon.one, favouring science and technology, healthcare and physics, which are seen as progressive over history, education, literature and language, often seen as regressive and no longer representative of their experience.
The effect of working or studying at home has caused them to question careers, workplaces, work habits and community interactions.
More uncertain than their elders as to a future where the planet and human work are in jeopardy, they question things more deeply, and this can have a knock-on effect on brands as to their values; Gen Z is said to be uninterested in following brands for their values but asking how those brands reflect their values. They are considered disloyal and have higher expectations than any other cohort.
Brands are not conspicuously consumed and merely bought for the status they impact (as for Millennials). Instead, Gen Z buys more as an expression of individuality. To Gen Z, the world revolves entirely around them, and they are more vociferous as to their likes and dislikes than any previous generation.
Don’t act on a generalisation
While all generalisations are dangerous, including this one, it is easy to see that the picture is unclear; it keeps changing, and everyone has different views that can conflict. The challenge for brands in reaching this consumer, whose trust is not easily won – and maybe even harder to retain – is which views will they act on? And act they must, because it is Gen Z that is setting the trends for the future, and it must be remembered even though many have not started earning yet, influencing upwards to older cohorts.
First, for Gen Z, location is no longer immutable but fluid; it is wherever the brand is, so it is less about bricks-and-mortar and more about cyberspace. However, this is contradicted by the fact that Gen Z use stores for clothes more than Millennials, although those physical locations may be more about a 24-hour pop-up than a four-storey, stone-clad department store. McKinsey says roughly 35% of Gen Zs say they’re shopping somewhere that’s not a modern or traditional grocery store, a mass merchandise store, or a club member store.
Access to them is different, too. Retailers must recognise that it is only sometimes direct but often through influencers, family and friends, particularly when these latter groups are the purse holders. What this means is Gen Zers are not receiving the standard emails and texts that brands rely on to keep in touch with their customers, or if they are, they are not looking at them, preferring to spend their time on screen on social media instead. The hard point to be made here is that the most profound connection a brand can make with a customer is emotional, but that is hard to achieve if the route to them goes through other people and channels.
What we can generalise about is brands have to win every purchase, particularly as Gen Z are not typically repeat or subscription buyers. They want to be wowed every time in order to convert.
The keys to success are data and unified commerce, enabling brands to be omnipresent and deliver content and communications sensitive to each scenario and customer type. These interactions need to give the customer more control, placing them at the centre of the experience and making each step frictionless.
The good news is that the capabilities are mostly already in place. This is not about abandoning the tactics brands currently use for all other cohorts. For instance, Gen Z shoppers still divide into price-, quality- and value-conscious and should be marketed to accordingly. However, it is essential to monitor how each tactic performs in each sub-category so that, over time, building deeper knowledge will enable brands to move to personalised communications and marketing and respond better based on cumulative feedback.
It is also not about brand new systems but making better use of what technology is already in place, using APIs to embrace composable commerce that will have the agility to take advantage of what is happening in the market right now and to act more quickly on new and unexpected trends as they emerge. This approach also gets around Capex restraints, moving tactical application development to Opex.
Ultimately, this approach also enables brands to be brave enough to challenge what they are doing currently and try new ideas. Informed by data and armed with intelligent processes, brands can keep pace with the enigmatic Gen Z consumer as they move into the commercial mainstream.
