A month ago, we talked about how women consumers are important for business success. Today, let’s talk about how brands need to approach GenZ to stay relevant in a post-pandemic global market.
Much before we conjured the term “influencer,” young people played that role by creating trends. Today, a new generation of influencers has emerged – Gen Z, Generation Z, individuals born after Millennials, between the late 1990s and early 2020s.
Gen Z members are true digital natives: since their formative years, they have been exposed to the internet, social media, and mobile systems. And it has produced a hyper-cognitive generation that is pretty comfortable collecting and cross-refreshing several information sources and integrating virtual and physical experiences.
And as global connectivity is reaching new highs, Gen Zers are becoming powerful influencers on people of all ages and incomes. They are also impacting the way the general population consumes and connects with brands (1).
Fundamentally, GenZ has emerged in an ecosystem that is transforming the entire business landscape.
It is a generation looking forward to being greater than Millennials and to every other generation combined.
Today, they’re the ultimate early adopters, and we are witnessing how their consumption habits are now influencing the behaviors of GenX, Millennials, with even younger generations following in their footsteps.
And as the new generation is transforming the consumer landscape, new transformational but challenging opportunities are also surfacing for businesses.
It is time for businesses to rethink how they deliver value to their consumers and practice what they preach when addressing work ethics and marketing issues.
The youth are homogenous globally in terms of purchasing power. The oldest members of GenZ are now entering the workforce and will take over about 40% of all consumer shopping in the next year.
So, what can brands do to engage with a whole new wave, a new cohort of consumers?
First, Let’s Understand Gen Zers
Several studies highlight four core GenZ behaviors, all of them affixed in one element, their search for the truth. Gen Zers value individual expression. They rally for various causes while believing deeply in dialogue’s effectiveness to solve conflicts and mend the atmosphere.
Finally, Gen Zers make decisions and relate to institutions systematically and logically.
Businesses should concur with three implications for GenZ:
- Consumption as access, not control
- Consumption as an expression of individual identity
- Consumption as a matter of ethical concern
And couple them with technological improvements.
In essence, the below checklist is an excellent starting point for brands looking to earn Genz consumers’ trust:
- Earn their attention
- Stay true
- Exercise what you preach
- Focus on brand values
Marketing Practices to GenZ
While targeting Gen Zers, marketers often confront murky challenges (2). It ranges from making sound decisions on influencer partners to underscore authenticity in a way that doesn’t backfire.
Most GenZ members gravitate toward different brands than previous generations. However, if brands need successful marketing strategies for Gen Zers, marketers need to understand how they respond to different marketing appeals and offers first.
It isn’t enough to create Snap and TikTok campaigns and call it a day. While the best marketers understand each consumer segment’s channel preferences, it is best to understand each consumer’s beliefs and behaviors further and speak with creativity and authenticity.
Gen Z, representing about 32% of the global population, is also the most racially diverse generation in our history. It represents an enormous opportunity for business while also raising incredible complexities.
Marketers that embrace this complexity by creating new analytics to understand their several sub-segments, find more precise ways to communicate with them, and deliver how GenZ consumes information will be successful.
In short, marketers need to toss out the playbook that worked with prior generations and redefine their strategies for GenZ consumers.
As noted, GenZ is the first digitally-centric and mobile-native group in history. It means that this generation has been completely bombarded with information across multiple channels.
Consequently, Gen Zers have well-adapted blindness for noise and do so almost instantly. If a brand can’t make its case in less than 10 seconds, it is out.
And with its superhuman filter, the generation has also redefined the meaning of “authenticity.”
In their eyes, an authentic brand is the one:
- that stands for something more than only making a profit
- that helps to make the world a better place in a unique way
- that is transparent and honest
- which keeps it “real.”
Since GenZ had this overwhelming “information overload experience,” it is natural and logical for them to adapt and create an “authenticity moat” to survive the information onslaught.
No other generations have had this unique and overwhelming ‘information-overload experience.’ So it is logical and natural to see that GenZ consumers have had to adapt and build out this ‘authenticity moat’ to survive the information onslaught.
Hence, running blind using traditional marketing techniques would be a disaster for businesses. Since GenZ is an entirely different section, marketing measurements for them must be too.
So, what can brands do to stay relevant in a post-pandemic global market?
- Brands need to go for deeper segmentation.
- Brands need to create a more compelling digital experience to stay ahead in the market.
- Brands need to go phygital.
- Brands need to focus on process/customer experience improvements. Improvements in delivery and return efficiencies, for example.
- Brands need to focus on long-term brand-building activities (3).
Difference Between Marketing to Gen Z and Millenials
About three years ago, there were several reports about the importance of marketing to Millennials. Today, it is time for marketers to update it and focus on Gen Z.
While Millennials and Gen Z may look similar, there are several differences in their buying habits, how they interact with brands and their marketing strategies, and how they look at money.
As per a recent survey (4), 66% of Millennials look for a higher standard of customer service than 53% of GenZ. Millennials would also pay more for greater consumer experiences compared to GenZ.
On the other hand, Gen Zers want more new products and services, especially digital varieties, than Millenials, as we approach the end of the coronavirus pandemic (hopefully!). However, it doesn’t end there.
Trust is another big factor that contrasts Millenial and GenZ, as GenZ members are less trusting in general. As noted, there is little that businesses can do to earn their trust compared to Millennials.
While we all like to save money, GenZ appears to have made it a lifestyle choice compared to Millennials, who are more interested in the experience above all else. Why? According to experts, the influence is that Millennials grew up during an economic boom more than GenZ, who grew up during an economic recession.
That’s why a good marketing strategy for Gen Zers can include placing high emphasis on high-quality investments and offering multiple bonuses and deals.
While Millennials are all-in from a brand-centric perspective, with their tendency to pay more for preferred brands, Gen Zers are more about creating their own brands. They want to celebrate their independence, being their own person.
That’s why a good marketing strategy for GenZ is to focus on the individual, creating ads that allow them to feel a sense of independence without any boundaries.
Overcoming Gen Zers’ Ad Blindness
The global digital ad industry, worth nearly 365 billion USD, has saturated the online market to the point where an average person can see up to 10k online ads a day.
Gen Zers are raised in these digital contexts. Even though there are forecasts that the industry will grow to 460 billion USD in the next three years, current marketing efforts are not enough to get younger generations’ attention.
GenZ is increasingly resilient against digital marketing strategies that continue to convert Boomer and Gen X consumers. In fact, nearly 90% of the young generation distrust conventional advertising tactics (5), which includes digital ads mirroring these approaches.
Whether online or offline, for instance, outbound marketing is pretty much ineffective with the younger generation (6) compared to influencers and other forms of inbound marketing. In addition to looking at why young generations distrust brands, marketers also need to look at the evolving digital terrains to understand younger consumers.
Brands also need to change how they understand digital audiences, transforming from third-party data collection driving to first-party data extraction, empowering personalized interactions. Gen Zers expect much from brands and tend to demonstrate far less brand loyalty than their older counterparts.
Below are a few reasons why Gen Zers remain ad-blind and how advertisers can overcome it.
Stop Talking at Young People
Gen Zers are not brand loyal in the ways older generations have been. It means they have high expectations and are inclined to change brands pronto if unsatisfied with a product, service, or experience.
Gen Zers are extremely aware of the difference between a brand that centers itself instead of its audience, and that’s why they ignore a brand and its ads. The solution? Digital ads must stop talking at young people and start creating an online conversation with them.
Businesses can do it by creating more thoughtful funnels that acknowledge the complicated ways GenZ understands digital experiences. Basically, brands’ digital ad strategies must consider them as people they can serve rather than mere data points.
For instance, ads to Gen Zers that push purchases are ineffective. On the other hand, brands that offer feedback opportunities, offer ads with genuine value, interesting information, and demonstrate personalized understanding of their audience do better.
Brands that can make this transformation will find younger generations more open to their ads and potentially invested in their offerings.
Advertise on the Right Platforms
Apart from not understanding Gen Zers, several advertisers also don’t understand where to find them.
It is not only about “using social media” to engage a young audience; brands need to understand where to connect with them.
For instance, brands storytelling on social media sites via smartphones is some of the best locations for digital ads to connect with audiences; however, marketers need to ask “why” in the context of their brands.
Marketers who can answer why their brands should be on a smartphone social platform in context to the new media habits of Gen Zers are more likely to build an effective ad strategy with the right technical experiences.
Relevant and Useful Digital Ads
If brands hope to make GenZ dollars, they must meet the online standards they expect. One of the biggest issues brands have is that they often fail to understand why young audiences follow their online content, including their interest and disinterest in their ads.
According to Tom Ritondale, a digital marketing expert (7), “60% of younger people follow at least one brand on social media platforms. Their main motivation is to get updates on the brand and its offerings. It adds more credibility to the notion that if the content is respectful to their desires, they will engage.”
Brands that understand where their audiences are and why they are interested in their offerings will be better positioned to serve ad content relevant and useful to young audiences. While several digital ad targeting models are gaining momentum (8) that can help brands comprehend it, marketers also need to think more thoroughly about the real value their brands ought to be putting into the world for their young consumers.
According to Marketing Strategist Meaghan Moraes (9), “younger generations support businesses dedicated to improving their customer’s lives with informative content. Rather than a list of offerings, they want ebooks, blog posts, videos, white papers, and other how-tos, and that is inbound marketing.”
Brands that can find ways to shift towards different communication methods in the right places with relevant and useful content are more likely to target Gen Zers.
As Ritondale explains (10), younger generations don’t mind digital ads; they only want ads that make sense. That’s why brands need to consider the message, the context, and the technology.
Brands Need to Go Beyond Ads to Connect Post-pandemic
We have heard about advertising death (11), with ever-increasing ads having less influence on consumer decisions. Today, we see up to 10k ads everything, each of them being less impactful. As it turns out, hitting people in the face is a bad way to convince them.
Despite the diminishing returns across the industry, ads are resilient. Consider the impact on ad spends during the initial months of the pandemic. Even though there was a sharp decrease in digital ads, it increased 12% last year (12).
Now, as the world attempts to return to normalcy, it is not only Google and Facebook that are benefitting from the boom. As reported by The New York Times (13), “the travel industry, liquor companies, and everyone are hoping to capitalize on a wide-open market and have started pouring money into ads on virtually every channel, but mostly on digital platforms.”
However, do all these ads make an impact? Most of the data suggest they don’t. Back in 2013, for instance, eBay conducted a now-famous study that indicated (14), “several paid online ads make virtually no increase in sales, and even for ones that do, the sales benefits are far overshadowed by the cost of the ads.”
With Apple launching a new iOS update that allows users to stop apps from tracking them for ad targeting purposes, the industry is at a crossroads because fewer consumer data may equate to less effective ads.
So, how can advertisers adapt to reach consumers, including GenZ, who are pretty skeptical of brands (15)?
One of the most recent solutions was influencer marketing. However, it now has its own struggles as influencer engagement rates are plummeting (16).
Hence, instead of throwing more money, it’s time brands start getting more creative and meet where their consumers are.
Below are four predictions on how brands can market and advertise to stay relevant in the post-pandemic world.
However, the future of the experience economy is also digital.
As AdAge explained (19), today, people’s digital life is as important as their analog life; since everything starts online, from the way they bond and interact with each other to how they do business or entertain themselves.”
While on the subject, Deloitte also recently found (20) that young generations prefer to play video games, engage on social media, and stream music than watch TV or movies.
Their desire for active experiences rather than passive consumption indicates the importance of creating online moments that authentically engage young users. A notable example was the launch of virtual runs and races (21) from the NYC Road Runners and other organizations, which received increased participation and delighted runners who could not participate in person.
Evolution of The Creators’ Economy
As the Deloitte report highlights, Gen Zers don’t want to consume. They wish to create and participate in sharing content.
We only need to look at the rise of TikTok, YouTube, Snapchat, and other platforms that allow users to create and share video content to see the case. However, the future of the creator economy is moving beyond video, with gaming platforms like Roblox.
It means brands need to directly involve consumers by creating a community and allowing them to share audio, video messages, personalized images, and more (22). When consumers become creators, they feel more connected and loyal to the brand.
Content is The King
We all know the value of content to influence consumer action. Take a look at affiliate and referral programs, where businesses pay media outlets such as The New York Times’ Wirecutter (23) for sales generated via its articles and other content.
Businesses not only buy into affiliate programs but also create their own compelling tactics. With engaging writing, video, and audio content, which has recently seen a rise with the emergence of platforms like Clubhouse, brands can target specific audiences via enthralling messages and build high-conversion rates purchasing opportunities.
The Rise of Metaverse
Several aspects of previous predictions are colliding with “metaverse.” It means a series of growing internet-connected worlds where people express themselves, interact and share AR Augmented Reality and VR Virtual Reality experiences.
Typical examples of the metaverse count interactive world-building games such as Fortnite. Early and highly successful metaverse events, like Travis Scott’s Fortnite video game concert, combined gaming, music, commerce, and communal experiences (24).
It indicates that cross-platform experiences can dominate (25) their respective channels and illustrate the expanding opportunities for brands to reach enthusiastic audiences in the metaverse.
Even though conventional advertising will keep lingering, futuristic, engaging, and personalized marketing means will keep evolving.
Brands that will effectively utilize new mediums and strategies are more poised to attract GenZ and create loyal and engaged audiences of younger generations in the post-pandemic world and beyond.