How retail can prepare for Gen Z customers
Millennials have had all the attention in recent years. However, we're moving towards the dominance of a new demographic - Generation Z. The first generation to have been weaned on smart phones, these young people are unlike anything that has gone before when it comes to expectations and attitudes. They also make up a very sizeable proportion of the population - larger even than millennials. So, Generation Z is an important audience for retailers and one that the industry should prepare to engage with.
The Generation Z customer
Making up around 26% of the population, consumers that form part of Generation Z were typically born in the mid-1990s to the early 2000s - we're talking of ages 4 to 22. Attitudes among this generation have been shaped by key events, such as the 2008 recession, which meant that many saw their parents of relatives struggling financially. As a result, this is a generation with a more cautious and pragmatic outlook when it comes to spending - they are less likely to get caught up in ideals and fantasy.
Preparing for Generation Z Customers
Retailers looking to engage with this generation can prepare by gaining an understanding of what makes it different
Generation Z has virtually grown up with social media. They don't just see it as just a tool for social networking but are open to its many uses. Frequently, they use it as a communication channel and it is a part of every day life for most.
Values and vision
Young people within this generation are typically much more socially and politically active than their predecessors. Many have defined where they sit on key issues at a young age and are looking to engage with businesses that are clear on their values, especially those that align with the consumer's. For example, 93% of Generation Z believe it is important to bank with an ethical business.
Generation Z individuals are pragmatic and savvy. They are much more able to spot attempts at marketing manipulation or advertising that is lacking in subtlety, and tend to be more of a challenge when it comes to motivating them to make purchasing commitments. Being so familiar with technology means that retailers require a more sophisticated approach to digital marketing to reach them.
Millennials were raised by Baby Boomers, whereas it's Generation X who parent Generation Z, and this has created vastly different attitudes to issues such as spending and security. Culture, events and influencers are all different for these two groups, which means that it would be a huge mistake for any retailer to assume that Generation Z are simply "Millennials on steroids".
Generation Z is about to take over from the millennial as a key concern for retailers. Many are just getting to the point in their lives where they are beginning to make purchasing decisions. So, for retailers looking to engage this key audience, now is a crucial time to start developing a strategy to encourage brand affinities that will last.
We spoke to Gen-Z consumers globally. Find out what they told us
That's why we explored just how Gen Z like to shop, and what expectations they have from brands and retailers - including Amazon. The findings were illuminating - from growing disloyalty to a certain retail behemoth and an appreciation for brands with purpose and an ethical agenda. The new report The Future Shopper is due for release in June 2019.