Is your brand ready for Gen Z?
Also known as post-Millennials, the iGeneration, or Zoomers, they have the fastest-growing disposable income, which is expected to reach $33 trillion over the next decade. No matter what you call this generation, your business’s future is likely to depend on them.
Growing up against the backdrop of social upheaval, climate change, and a global health crisis, this is a generation that struggles with mental well-being, but they don’t hold back when talking about it. With many coming of age during the pandemic, the past two years put a mark on their lives and outlook on the future. So, what characterises these Zoomers in the US*, and what are their expectations towards brands?
Redefining what it means to make money
Gen Z wants to write its own money rules. Flirting with TikTok and YouTube algorithms, this generation turns its social game into a business plan in no time. In fact, 51% of US GenZ would like to start their own business. But Gen Z is also the first generation with an incredibly high level of financial literacy at a very young age. They follow influencers on social media for financial advice, and 62% has put ‘fin-fluencer’ advice into practice and has invested in the past year. While more traditional products like stocks and education funds take the biggest share in their investment portfolio, Gen Z sees a lot of potential in art and new investment products such as cryptocurrencies and NFTs.
When it comes to brands in this space, Gen Z expects accessible and actionable advice from them to build financial resilience. Copper, for example, taps into this opportunity space. The debit card and banking app helps teens to set goals, learn about budgeting, and save for the future. At the same time, parents can monitor their teens’ purchases in real time, through the app.
It’s ok not to be ok
In the US, 55% of Gen Z feels stressed, caused mainly by mental health (60%) and studies/ job (45%). While social media is a space for Gen Z to connect, be creative and relax, it is often cited as a contributing factor to their mental-health struggles. Comparing themselves to others (34%) and external expectations (16%) add to the stress equation. Unrealistic depictions and image filters put a lot of pressure on looks for this generation (67%).
Gen Z’s focus on mental well-being can inspire brands to take on the role of life coach, supporting youngsters in prioritizing their mental health and encouraging discussions around the topic. For Mental Health Awareness Month 2021, and in collaboration with The Jet Foundation, Victoria’s Secret’s PINK launched ‘Make Your Move’, a program full of tips on how movement, expressions, connection and self-care can help us feel our best. As part of their Beauty Unaltered campaign, CVS Pharmacy implements a special for any unaltered image, because images are powerful, and using unaltered images can lead to a powerful change. CVS is asking their partners to join the movement, hoping to encourage realism in beauty marketing.
Amplifying their voice and worlds online
Social media plays a central role in the everyday lives of Gen Z. 34% of this ‘always-on’ generation even feels anxious if they (must) disconnect for a day. While this visual- and video-driven generation turns to YouTube for entertainment and tutorials, TikTok provides a creative outlet for memes and viral content. Together with Instagram, the latter is also used for digital activism. Just think about how the Black Lives Matter hashtag engaged a worldwide audience online.
Next to the more traditional social-media platforms, Gen Z is fully exploring the metaverse, from Fortnite to Animal Crossing to Minecraft and Roblox. Hanging out with friends in virtual worlds, creating an avatar, and spending money on virtual avatar outfits, is nothing extraordinary to them. No generation will embrace and shape the metaverse more than Gen Z, and they also expect brands to be there. Cereal company OffLimits, for example, launched 2,500 custom cereal-box NFTs. The NFT owners are invited to collaboratively design and mint a one-of-a-kind cereal-box NFT – both in the metaverse and in real life. In fact, all verified NFT owners will obtain four real-life packing containers of the ultimate cereal NFT.
Taking a stance
The global issues that keep Gen Z up at night are related to social inequalities. Being the most ethnically diverse generation in history, diversity and inclusion are key to them, with racism (48%) and LGBTQIA+ rights (18%) being top issues to tackle at global level. Consequently, 43% of Gen Z also wants brands to challenge societal issues. This focus on social justice is also reflected in their spending behavior; 69% is willing to pay more for brands that treat employees and suppliers fairly. Moreover, 42% would pay more for brands that are black-owned, and 41% for female-owned brands.
Gen Z not only expects brands to take a stand on societal issues but also to help educate them on how to support minority groups and communities. US retailer Target made a commitment to invest over $2 billion in black-owned brands by 2025, by focusing on those brands and offering mentorship to black designers. Since Target started investing more in black-owned brands, sales have increased significantly.
Gen Z is a very important generation that will bring about change in society. As they are the largest in size and their disposable income is expected to outperform that of any generation, your business’ future is likely to depend on them. So, is your brand ready for the Zoomers? Check out the full Ready for the Zoomers? report now.
*This blog highlights some key insights from a survey with 1,072 US consumers (Gen Z, Gen Y, Gen X and baby boomers).