Why & How Businesses Should Pay More Attention to Gen Z Customers

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Businesses spend a lot of time and resources creating their ideal customer personas. They take great pains to understand these carefully-considered archetypes, as their marketing and sales strategies will be dictated by what they know about them. While identifying your own unique customer personas is important for your business, there is one demographic that all businesses should keep a close eye on: Gen Z.

Most of us are familiar with the Millennial generation, but it’s actually Gen Z that is usurping the throne and assuming their spot at the top of the consumer food chain. Members of Gen Z, also known as Centennials, are younger than their more scrutinized counterparts, having been born in 1996 or later. Centennials are those who have never known a life without technology and they are poised to become the most important demographic for businesses to target.

Gen Z is already the largest population segment, and with the number of Gen Z-ers forecasted to reach 2.56 billion by 2020 they will be the largest generation ever. With this kind of population growth, Gen Z will make up 40% of all U.S. consumers and increase their 25% consumer spending share to 40% over the next decade. Suffice to say, if you aren’t already, your business needs to start paying careful attention to this cohort today.

Here are some important things to know to help you prepare for the Gen Z takeover:

They are mobile and omnichannel

96% of Gen Z owns a smartphone, and they’re heavily reliant on these devices versus a traditional PC for all of their Internet needs. In fact, they only spend eight minutes per day online via PC, compared to Baby Boomers and Millennials who spend at least an hour.

Gen Z-ers proclivity for mobile means that it’s omnichannel or bust when it comes to the customer experience you offer them. 46% of U.S. Gen Z consumers research items on mobile before making purchases in-store, proving that while brick-and-mortar might live to see another day, it’s only because much of the research process is happening via smartphones. If you aren’t providing customer touchpoints over a variety of channels that seamlessly connect, allowing customers to pick up where they left off, they’re more likely to just leave.

What this means for businesses:

You’re going to miss out on all of that spending power if you’re pouring resources into connecting with Gen Z-ers through one channel. It’s imperative to connect your various channels and streamline the CX. 60% of Gen Z shoppers won’t use apps or websites that load slowly or are difficult to navigate — which means the stakes are high. Limit the friction and reduce bad experiences, because with so much competition, losing a Gen Z customer is only one click away.

Their attention is spread across platforms

Gen Z is setting the trend for consumer behavior now and in the future. The way they interact with all of that technology they’ve grown up with is dictating what it means to be a consumer. While previous generations may have had a straightforward way of going about the purchasing process, Gen Z’s attention is likely spread around multiple platforms, so you have to find a way to capture it and entice them to buy. In fact, Centennials multitask across a minimum of five screens per day, and spend 41% of their free time with computers or mobile devices.

What this means for businesses:

Businesses need to tune in to what Gen Z is doing and how they’re consuming content if they want to have the opportunity to sell to them. With Gen Z-ers using their smartphones for almost three hours a day to consume TV shows, videos, music, games, and social media, and 70% watching more than two hours of YouTube each day, businesses can’t rely on old and outdated methods. Consider this stat: Only 18% of Gen Z-ers find that TV ads are highly influential in their purchasing decisions. So while TV may have worked in the past, businesses need to broaden the way they market and advertise to them. Working Gen Z customers through your sales funnel means getting in front of them on the platforms they frequent the most.

They are in control of the buying process

With every piece of information and knowledge just a click or swipe away, Gen Z might be the savviest consumers yet, and as a result, they’re in the front seat when it comes to the buying process. If you thought Millennials didn’t need salespeople, then just wait until you start working with Gen Z customers. They know exactly how to find the information they want and will rely upon many of their most frequented channels and platforms as a method of research. For example, 85% of Gen Z uses social media to learn about new products, and 34% want brands to reach out to them on social media.

Gen Z is also not going to be swayed by standard marketing tactics. In fact, most of their purchasing decisions aren’t coming from advertisements you target them with. 43% of Gen Z-ers said that their family influences their purchasing decisions, 35% said friends, 23% said friends of friends, and 10% said celebrities – meaning that they are looking for a more personal advocate of a product or service before they buy. And when Gen Z can’t get feedback from someone they know? They’re increasingly turning to online reviews, and with 84% of people trusting those online reviews as much as personal recommendations, businesses need to be aware of how their brand is presenting across both social and review platforms.

What this means for businesses:

Remember how you created that super fancy website with all of the bells and whistles? Well, there’s a chance Gen Z isn’t even looking at it until they’ve already made up their mind about whether or not they’re going to do business with you. If Gen Z is using social media and online reviews to learn about products and services you need to make sure you have strategies in place. From consistent and carefully branded social media presences to a robust online review strategy, businesses need to get their digital house in order to appeal to Gen Z.

They understand the value of content

Content is king — especially for Gen Z — and they expect that content to have value. Your content should offer them something more than a glorified advertisement or promotion. They want to get something out of that content to help them solve their challenges. That’s how content helps you sell — by solving problems. This is why so many Gen Z-ers turn to YouTube or Instagram to learn about new products and services. Though these influencers are making a profit with this branded content, they’re presenting it in a way that Gen Z-ers can relate to while also providing real value.

What this means for businesses:

Businesses should consider how they can partner with influencers to get in front of their Gen Z target audience. Every industry has influencers who have aggregated a loyal and engaged following around shared interests. With 44% of Gen Z-ers saying that they tried a recommendation and 30% actually bought a product recommended by an influencer. However, don’t fall into the trap where you think bigger is always better. It’s often a much better strategy to engage with multiple micro influencers that one “A-lister.”

They are used to everything on demand

Much like they don’t know what it’s like to live in a world without sophisticated technology, Gen Z-ers have also grown up in an age where they can get almost anything on demand. Whether they’re looking for a ride (Uber and Lyft), wanting to watch their favorite TV show ( Netflix and Hulu) or looking to grab their groceries without stepping foot into a store (Instacart), Gen Z can get exactly what they want without even lifting a finger — or well, without looking up from their phone. They expect everything to be on demand and easy, which, while great for them, can pose a challenge for businesses trying to keep up.

What this means for businesses:

The on-demand expectations of Gen Z-ers inevitably are going to trickle down into your business, so you need to be prepared. That means that areas like customer service need to be able to respond to that need for instant gratification. 60% of Gen Z-ers are more likely to hang up if their call isn’t answered in under 45 seconds. Remember that old adage that says it only takes seven seconds to make a first impression? Well, apparently reach 45 seconds, and you’re going to hear the dial tone. Alternatively, text messaging provides a great avenue for satisfying that on-demand expectation in the most effortless and instant way, in addition to other messaging channels or services like Facebook Messenger and WhatsApp, and ensuring that you don’t lose a Gen Z customer in the process.

Being able to satisfy Gen Z customers can mean big dollars for a business, but first, it comes down to understanding exactly what they want, and more importantly, what they expect. Gen Z is ready to spend their money — are you ready to provide the customer experience to help them to do that?

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