Millennials, Millennials, Millennials – retailers have been bombarded with information about the large, attention-grabbing generation of shoppers. But, an even bigger generational behemoth is hot on those Millennials’ heels – and they’re doing things differently than any other generation before. Gen Z is the nation’s first to be born into the digital era and makes up America’s largest demographic group (25.9% of the population). They may not even be 21 years old yet, but this generation is already beginning to exhibit influence, consumption, and spending power.
Gen Z, or those born after 1995, already contribute $44 billion to the American economy each year. According to a report by advertising firm JWT, over 70% of parents say their Gen Z children have the power to influence buying decisions about apparel and family meals. In just a few years, nearly 4 in 10 consumers will be from Gen Z, and their purchasing power will rise exponentially over the next five to seven years as they grow to be the single largest group of consumers worldwide.
Retailers need to be prepared for the fact that Gen Z will be shopping differently than any other generation, and they can’t merely be viewed as Millennials 2.0. Recent surveys have shown that this demographic doesn’t use technology in the same ways as twenty- and thirty-somethings. Where Millennials grew up on desktop computers, followed by laptops, Gen Z is growing up on smartphones, tablets and other portable devices that enable 24/7 connectivity. Gen Z also multitasks more on these devices, typically using five or more screens, compared to Millennial’s two. Where Millennials tend to communicate through texts, Gen Z uses images. In short, they are super tech savvy, and they expect retailers to be as well. Here are five ways retailers can reach Gen Z as we head into the holiday shopping season, along with a few brands that are doing them well:
1. Forget Selling through Hollywood Celebrities. Self-built Internet Stars Reign Supreme:
Retailers need to be aware that Gen Z is less influenced by pop stars and actors and moved more by stars who have built their own brands. This makes sense as 72% of current high schoolers say they want to build their own business someday. YouTubers, fashion bloggers and other self-built social media stars grab the attention of this demographic. This holiday season, redefine your marketing strategy and go after influencers with values and audiences that coincide with your brand– they have the reach and authority to drive results for your business.
LAX– yes, the airport– used Instagram stars to make something as mundane as air travel seem cool. More than 40 influencers took to the social platform sharing images of renovations with the hashtag #LAXIsHappening. Just 60 posts from selected influencers resulted in more than 300k impressions.
2. Mind Your Digital Messaging
Because of their deep knowledge of technology, members of Gen Z will research your brand and make their own decision about whether or not they want to shop with you before they’ve ever set foot in your store. Technology has morphed Gen Z into autodidacts by giving them the ability to find information on their own. It’s important that retailers maintain a consistent brand and user experience, both in-store and through each channel online, in order to appeal and properly market to this generation.
Upscale beauty retailer Sephora is known for their use of technology and digital strategies. Their omnichannel presence has made them a favorite among teens according to the most recent Piper Jaffray survey where they were the top pick among 38 percent of upper-income teenage girls.
3. Stay Socially Conscious
Gen Z loves to support socially responsible brands that are making an impact on the world. A study by Marketo finds that 60% of this generation wants their jobs to make an impact on the world, and 76% are concerned with humanity’s impact on the planet. This generation responds well to businesses that have a social component, particularly ones that Gen Z views as positive and empowering.
American Eagle stole the hearts of teen girls when they pledged to stop using altered images in advertisements for their lingerie brand, Aerie. For the accompanying campaign, they took to Instagram with the hashtag #AerieReal to share that real bodies are beautiful without digital the nip/tuck most brands employ.
4. Highlight Experiences and Interaction over Stuff
Members of Gen Z value experience over free stuff. They don’t want to be wooed with money but rather with memories. At redpepper, we designed and enacted a successful campaign for jewelry store Claire’s called the Claire’s Project BFF. The campaign gave girls the chance to design their own pair of best friend necklaces via a Web app.
The girls were then encouraged to share their creations on social media and invite their friends to vote for their designs. Whoever garnered the most votes became Claire’s newest jewelry designer, with her necklaces on store shelves worldwide. Throughout the course of the month-long campaign, the Project BFF website saw 277,120 page views, with an average visit of more than four minutes. Social audiences boomed for Claire’s with over 28K new Facebook followers and a follower boost of 27% on Instagram.
5. Stay Price Competitive
This generation is made up of excellent data hunters. They can use their smartphones to find the lowest price on an item in the blink of an eye. Retailers need to keep an eye on their competition’s pricing and make sure they offer the most compelling price.
The opportunity is ripe for retailers and brands to delve in for a deeper understanding of this emerging generation. It’s important to grab Gen Z’s often-divided attention. Marketing messages need to be quick and simple, relying more heavily on visuals than text. And instead of telling the retailer’s or brand’s story, retailers should be more concerned about starting a conversation with the Gen Z consumer. Gen Z wants you to be authentic, get to know them, and cater to their needs—and when you make the effort, then they’ll get to know you and help your holiday sales climb.
Samara Anderson is a retail strategist at redpepper.