Meet Generation Z: Values and Implications
Sabina Beleuz Neagu Agenda
● Our Approach ● Who is Gen Z ● Why Gen Z Matters ● Key Influences ● Values vs. Millennials ● Values in Action ○ Rich → Enriching ○ Easy → Instant ○ Authority → Trust ○ Shopping → Engaging Our Approach
Gen Z’s outlook on ● What does Gen Z think about product values? Life ● What does Gen Z think about money/spending? life/world? ● What does Gen Z think about ownership/stability?
How is Gen Z ● How does Gen Z learn during early education? Growth ● How has Gen Z’s higher education changed? raised? ● What values does Gen Z’s family instill in them?
How does Gen Z ● Where does Gen Z spend most of their time? Time ● How do they commute; how long does it take? spend time? ● How much time is spent using technology?
How Gen Z consumes ● How does Gen Z find products? Goods ● How does Gen Z buy products? (physical/digital?) ● How does Gen Z perceive brand image? Who is Generation Z?
Meeting the next-gen target market - grade school through college-age Why Gen Z Matters Today: $200B Spending Power Looking Forward: In 10 years, Gen Z will be between ~17-31 years of age → one of the most coveted consumer demographic groups. Key Influences
● Doom & gloom events & movements ● Millennials criticized as hedonistic idealists
and... Platforms they Use People they Watch Liza Koshy The Try Guys Vine Star → Youtuber Buzzfeed → Youtubers
People they Listen To
BTS Troye Sivan Bethany Mota Philip DeFranco South Korean Boy Band Youtuber → Musician DIY/Lifestyle Youtuber “Quick News” Youtuber YouTube is Gen Z’s trusted source
Young, lifestyle-focused Youtubers are most “influential”, even over incumbent Youtubers that dominate rankings 1. Pragmatism > Idealism 2.ValuesSelf-Improvement vs. Millennials > Self-Aggrandizement 3. Change > Dream
1. Pragmatism > Idealism 2. Self-Improvement > Self-Aggrandizement 3. Change > Dream 1. Embracing Pragmatism Over Idealism Aim for jobs in growing, less Cost is considered in deciding automatable fields (eg. software which college to go to, or if to engineering) or low-risk forgo it altogether in exchange entrepreneurship rather than for bootcamps or online programs chasing dreams
“I need a job that will come out “Why sink yourself into exorbitant with money, otherwise college will amounts of debt when you can be a waste”, says Marcus, 17. “I learn everything online at a want to pick a career that is fraction of the price?” - Tiffany stable.” Zhong, 18 year old VC
Gen Z is fearful of spending debt
Because of Gen Z’s financial concerns, they are fiscally conservative
Gen-Zers are “really laser-focused on the financial consequences of their decisions”, which may pose a challenge to traditional luxury retail 2. Self-Improvement, not Self-Aggrandizement
“I’ve always felt like I needed 25% of Gen Z respondents report to be extremely likely to be participating in to prove myself,” says Sneha, self-improvement actions (eg. learning, 16, who’s learning how to code. fitness, self-care) in the next 2-3 years “Hard work eventually pays off.” 3. The Progressive Change-Makers
● From Hackers to Changers ● “Generation Z really does want to change the world they are growing up in, from gender neutrality to saving the animal kingdom.” ● 94 percent of Gen Zers believe that companies should take a stand on social and environmental issues.
1 in 5 Gen Zs say that their impact on the world is an important issue in their day-to-day life Desire for Equality, Inclusivity and Diversity Diversity as the norm, not the exception. “The Census Bureau is actually forecasting that over half of kids in America will belong to a minority race or ethnic group [by 2020], so diversity in the traditional sense of the word has actually become the norm.”
Prefer brands that celebrate 36% think that diversity, their employers originality, & must support boldness rather than perfect, equality in the unattainable workplace lifestyles Values in Action...
● Rich → Enriching ● Easy → Instant ● Authority → Trust ● Shopping → Engaging
Less Rich, More Enriching Out with “rich” luxury, In with enriching luxury.
● Aspiration to self improvement, not self-aggrandizement, meaning they’ll more likely pay for luxury health, food, or fitness products than high-end jewelry ● Millennials actually prefer clothes without labels or logos, likely similar to Gen Z, putting product at the center rather than luxury symbols Change in mindset: “the holes” rather than “the drill”
ingredient-oriented
goal-oriented Enriching luxury examples Implication The Future of Enriching Luxury
Due to the lower cost of these products than in the traditional luxury space, there should be a growing number of new startups in this space.
Expect a lot of growth in the mid-priced affordable luxury space across industries, especially related to self-improvement or health-related items.
From Easy to Instant Understanding the mobile native
● Spends more time on mobile (4:10 on mobile, 3:49 on laptop/day) ● 74% report to “spend most of their time online” ● 60% of shoppers already use their phone to look up information in store Gen Z’s trusted tool: the 8-second filter Digital Accessibility Examples Implication Growing up with tech = learning and eventually, working, with tech EdTech in early education, learn-to-code platforms, and technical bootcamps prepare Gen Z for a smooth entry into a practically-oriented, technical skill-craving labor market
Less Authority, More Trust What’s out: “Authoritative” Positioning What’s in: “Trust-Earning” Branding A Shift in Branding Imagery
A Shift in Promotion Channels What better way to cater to “real” Gen Z than to market through Gen Z itself?
Brands that attempt to relate to Gen Z audiences through similarly-aged social media “Influencers” use social proof to generate sales.
Instead of focusing on targeting big names, Glossier reaches out to customers who engage with the brand on Instagram that attend pop-up events and have a moderately high social media following to recommend products via their own profiles. Does Research via their peers, already
Gen Z is more likely to get omni-channel input and feedback before buying than millenials (48% of Gen Z vs. 44% of Millenials get input from friends and family before purchasing)
51% does brand/product research via social networks Implication
The Future of Social Media Product Search & Purchase Brands targeting Gen Z should aim to market through Gen Z itself.
As purchasing capabilities are integrated into social media platforms along with product promotion, social media may become one of the primary channels of commerce in the near-future. Another way that brands build Gen Z’s trust...transparency. Gen Z is taught that transparent = trustworthy Implication The Future of Product Transparency To keep Gen Z loyal to their products, brands will have to incorporate transparency as a core value or suffer the consequences.
Less “Just” Shopping, More Engaging The Evolution of Brand Interaction
Deep Traditional Engagement Engagement Prefers Deep Brand Engagement
● Gen Z seeks to form an omni-channel relationship. ● Active engagement desirability increases in growth markets Brick-and-Mortar Retail as Experience
● Millennials said that more than half (52%) of their holiday spending would be experience-related, compared to 39% for older consumers → predicted to increase with Gen Z. ● Implications for retailers: preserve stores, but reimagine stores so they are an extension of the brand itself -- create a digitally connected, interactive, and highly-personalized shopping experience
Everlane’s “Shoe Park” Pop-Up store Magnum’s “My Magnum” Pop-Up Amazon’s roaming -- despite the fact that $51M of Ice Cream Shop -- an “Treasure Truck” that sells only 1 Everlane’s sales in 2017 came from Instagrammable branding exclusive item across the country ecommerce. experience via smartphone ordering Implication
The Future of Changing Brand Interaction
While more traditional brick-and-mortar retailers may switch to e-commerce or be challenged by online competitors, engaging and innovative brick-and-mortar retail experiences will thrive through Gen Z’s desire for tangible interactivity.
Proof of Concept in Retail Industry
Where it’s happening, and where it’s worked It’s all about health, without Food Trends sacrificing the experience.
Seeks healthful, gentler on the environment, and aesthetically pleasing. Packaged foods venture further into the “superfood”, “vitamin”, or “beauty supplement” realm, with emphasis on transparency in branding.
● Alternative energy (caffeine) sources ● Plant-based copies of traditional foods ● Pre-made teas, smoothies, etc ● Relatability in branding Retail Incumbents are taking notes...
“Target opens up a new store in San Francisco to try out smart devices” fortune.com, 2015
“Target is facing off against Amazon with its own “New Target brands take aim at Gen Z” Retail Leader, 2017 super fast grocery delivery service…” Business Insider, 2018 And it’s paying off... Retail Incumbents are taking notes...
“Sephora Innovation Lab scouts retail tech opportunities” CB Insights, 2018
Launch of “Natural” and “Inner Targeted Ads AR Shade Testing + Tutorial in-store Beauty” categories on Facebook and via mobile app And it’s paying off...