How Retailers and Brands Can Entice Gen Z
Deals, mobile capabilities, and authenticity — these are some of the principles for attracting Gen Z shoppers. But how does the data support this common wisdom about enticing the youngest adult consumers? And what steps can brands and retailers take to win their dollars this holiday season?
Jon Hudson is Vice President of Customer Success at Digital Turbine. He checked in with Street Fight to share some fresh data on Gen Z preferences and tips for connecting with the young shoppers during the holidays.
What does data indicate about how Gen Z’s shopping preferences differ from those of other generations?
The main difference between Gen Z’s shopping preferences is that they consider shopping much more of an experience than a utility. Thanks to their desire to be high tech, find deals, create brand relationships, and still remain fashionable, shopping isn’t something that they do simply because they have a need for an item. It’s rather part of their lifestyle as they create a full experience around their shopping behaviors.
Gen Z is the first generation where their entire life has been influenced by social media — they haven’t experienced the absence of it. While 84% of them use at least one platform, they also rank by far as the most active. The result is that the Gen Z shopping “experience” typically starts with someone else’s opinion: that of a friend or a social media influencer, for example. In fact, 80% of Gen Zers use social media for product discovery. This contrasts with other generations, where the retailers themselves, through ads, catalogs, and other promotions, had heavier influence on discovery.
Despite being heavily influenced by social media, Gen Z also puts a lot of emphasis on brand relationships, with both brand authenticity and transparency mattering more than older generations. Their brand relationships tend to start online, too, with 61% of them following brands they like on social media (compared to only 34% of other generations). This matters because data also shows that consumers are more likely to make a purchase from brands they follow.
The last data trend that matters for Gen Z is their emphasis on finding deals. When making a purchase decision, 62% of Gen Z values affordability compared to 53% of older generations. Combining affordability with social media influence has led to the meteoric rise of SHEIN, who has smartly combined the “fast fashion” trend with celebrity influencers and a #SHEINhauls hashtag. Klarna also has tapped into the value-oriented with their Buy Now, Pay Later functionality, which Gen Z is 123% more likely to use.
How will these trends affect this holiday season?
As Gen Z is mobile and social media first, retailers need to rely on other people’s influence. When it comes to building sales for the holidays, brands need to think early enough to first build the influence needed to get on Gen Z’s Holiday Wishlists.
This particular holiday season might also present a bigger opportunity for brands to engage Gen Z — perhaps more than any other time ever. This is because due to financial concerns, shoppers may be opting for places where they can find the best deals and promotions. And a key factor for engagement would be spreading out those promotions over time instead of focusing on just one event (like Black Friday) since people with less disposable income will be spreading out their purchases.
Overall, the holidays provide a window for brands to cement themselves as part of the Gen Z lifestyle. Instead of thinking of the holidays as a “one-time buy,” brands should look to find lifelong customers.
What steps can brands take to appeal to Gen Z?
First, with a mobile ready audience, brands better be ready to ramp up their mobile savviness to 100% or simply forget about connecting with Gen Z. Their mobile app should take friction out of the whole shopping process — from discovery to purchase to delivery. And from there, they need to be smart about re-engaging customers through loyalty deals and on social media.
The other primary factors driving Gen Z include price-related rewards such as free samples, giveaways, discounts and promotions. Following the success of SHEIN, which tied these promotions to social media campaigns like hashtags and celebrity influencers, brands should look to find ways to get their promotions out in an appealing way for this audience.
The holidays this year also present an opportunity to appeal to those shoppers that are returning to stores after the pandemic. For example, offering in-store promotions, coupons, and loyalty programs only available to app users. Big name brands like Lululemon and H&M have seen success drawing customers in-store by offering discounts to app users that are only redeemable at location. And since Gen Z still likes to visit stores to try new items, this is an excellent opportunity to connect audiences.
How do Gen Z trends apply to multi-location brands and retailers specifically?
With Gen Z’s “digital first” mindset, brands need to consider how they can use their digital footprint to drive consumers into the store. While the relationship may start on screen, multi-location retailers have the opportunity to take them beyond the screen. For example, creative use of in-store QR codes can create brand value digitally. Additionally, they should consider how they can leverage their influencers to build content through an omni-channel approach – like in-store displays or even a “meet and greet”.
While Gen Z experiences start and perpetuate through digital channels, multi-location brands have the opportunity to cement that relationship with their in-person presence. Despite their strong desire to do product discovery on their mobile phones, 81% still like shopping at the store specifically to find in-store price-related rewards, such as free samples, giveaways, discounts and promotions.
Another key thing for multi-location brands to recognize is the value Gen Z places in Brand relationships. In order for those relationships to grow and thrive, each location should deliver a consistent experience. Decor and displays should be similar, staff should be versed similarly in how to communicate the brand experience, and customer service should be consistent.
Also building loyalty programs extend not only from app to store but through ALL locations helping to grow the experience for the Gen Z audience. The best way to do that is to get personal with them and create intimate touchpoints, not by spamming promotions and sales, but by delivering them smartly through your app or social media channels. Creating that experience that transcends location and digital channels will win you customers not only for the holidays, but for life.