All about the Generation Z consumer

Generation Z consumer

In a recent article, we gave some insights to help you get to know the coveted millennial consumer group. But that’s not the latest generation that businesses need to be mindful of when it comes to marketing.

Hot on the heels of millennials is Generation Z.

The two age groups are often lumped together, but Gen Zers have some distinct characteristics that differ from their predecessors. And not paying attention to those differences could be costly for businesses.

Here’s what you need to know about Generation Z.

What defines Generation Z?

Pew Research has defined the generation as those born between 1997 and 2012, making the oldest members 22 years old in 2019.

  • According to Bloomberg, Gen Z will outnumber millennials by the end of 2019, accounting for about one-third of the global population of 7.7 billion.
  • Gen Z now claims the title as the most racially and ethnically diverse generation in American history.
  • Gen Zers also embrace diversity, with 62% seeing it as being good for society. That percentage is in line with the viewpoint of millennials, but higher than Gen X (52%) and boomers (48%).
  • Having grown up with digital technologies, they’re the first generation of true digital natives. In fact, 25% spend five hours or more on their mobile phone each day.
  • The generation has been nicknamed Homeland Generation, iGeneration, and Post-Millennials.
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Spending habits

In the US, Gen Z is expected to represent 40% of all consumers by 2020. Gen Zers already spend $44 billion annually, according to Adweek.

  • Generation Z stands out from other consumer groups with the significant influence they have over family purchases. One study found that more than 70% of Gen Zers claim to influence family purchases.
  • When their influence over family purchases is factored in, the real spending power of Generation Z is closer to $200 billion.
  • Cost is the most important factor for 72% of Gen Z consumers when making a purchase.
  • Gen Zers may look for the best price, but they’re also known for impulse buying and the “fear of missing out” (or FOMO) is often a motivator. Messaging that focuses on exclusivity or uniqueness can entice Generation Z consumers to buy things that aren’t the lowest priced.

Where and how they shop

Despite being digital natives, 98% of Gen Zers surveyed for a recent study said they shop in stores some or most of the time. That’s compared to 76% for web browsers and 48% for apps.

  • The ability to find things quickly is a crucial part of the shopping experience for Generation Z. 62% won’t use apps or websites that are difficult to navigate, and 60% won’t use platforms that are too slow.
  • Whether they shop in-store, with an app, or on a website, consistency is key for Gen Z consumers. 51% say they expect to be able to easily switch between channels with researching, browsing, or shopping.
  • 47% use their smartphones while shopping at brick-and-mortar stores to research products, compare prices, and find coupons or discounts.

Personalization drives engagement

Personalization is vital for catching the attention of Gen Zers. They expect communication with a business to evolve based on their interests and engagement, so data collection and analysis can make all the difference when it comes to targeting this generation.

  • Surprisingly, Generation Z has a greater tendency than other age groups to communicate with businesses they’ve found online by calling them. But how quickly that call gets answered is a significant factor. 60% of Gen Zers are more likely than other consumers to hang up if their call isn’t answered within 45 seconds.
  • 61% of Generation Z would be comfortable sharing more personal information if they knew it was being protected and stored securely.
  • For 59% of Gen Zers, it’s essential that brands and retailers remember their birthday.
  • Messaging apps offer another way for businesses to interact with Gen Zers. For 45% of Generation Z shoppers who choose to opt-in to such communication, location-based alerts are important or very important.
  • 41% of Gen Zers will opt-in with mobile ads that offer rewards.
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Social media dominates

It’s no surprise that Gen Zers are all about social media. In fact, some Gen Zers check their social accounts up to 100 times a day, and 52% have given out a social media handle instead of a phone number.

  • Research shows that 85% of the generation discover new products on social media and are 59% more likely than older age groups to connect with brands on social.
  • Compared to millennials, Generation Z shoppers are more likely to buy goods and services through social media. And the people they often turn to for recommendations are social media influencers. 63% of Gen Zers prefer “real people” over celebrities when it comes to endorsements, a reflection of the generation’s appreciation for transparency and authenticity.
  • 34% of American teens think Facebook is for “old people,” while Instagram, YouTube, and Snapchat are the most popular social platforms.
  • Instagram ranks the highest for brand discovery – 45% of teens use it to find new products. And before making a purchase, Gen Zers are two times more likely than millennials to turn to YouTube.

Generation Z shoppers may be less affluent than other demographic cohorts, but that won’t always be the case. Attracting their attention now will help your business gain long-term and loyal customers among a group that’s set to become the next spending powerhouse.

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