Generation Z: Flexible and Driven by Mobile

Generation Z, the people born between 1995 and 2005, are the latest generation entering the business world. They were born digital, of course – and while that claim is made by the generation before them, the now-entering-middle-age Millennials, most of the latter were alive before digital become ubiquitous. Moreover, Generation Z is the first generation to grow up with mobile phones.

Unprecedented Purchasing Power

Generation Z is big in technology news not just because of being born digital, though. They are great in number, at about 80 million, much greater than Millennials. They control $44 billion in purchasing power. Companies need to sit up and take notice accordingly, to change their business strategy.

It’s normal, of course, for teenagers and young adults to control purchasing power. That’s been true since the 1950s when teenagers made records and rock and roll king. But Generation Z has an unprecedented claim to purchasing authority. Nearly 10% of parents, for example, said that their children made 100% of purchasing decisions, according to Forbes.

Many marketers believe that Generation Z’s purchasing authority is even greater, pointing to young people exerting much more say in family buying decisions, such as houses and cars. Why?

First, online shopping gives Generation Z access to products, prices, and features. Generation Z can spend hours online shopping and comparison shopping. (On average, Generation Z’ers spend two hours per day on YouTube, so they could switch to online shopping sites if a big family purchase is coming up.) Their parents may leave the online shopping to them.

Second, their parents generally embrace democratic decision-making in the family rather than top-down choices.

This is good news for advertisers on Facebook. Despite the fact that Generation Z is often associated with new social channels such as Snapchat, Facebook is still number one with them.

They control $44 billion in purchasing power.

Less Attention to Demographics

One striking characteristic of Generation Z is that they are much less prone to respond to demographic appeals. They tend to purchase based on values, behavior, or needs rather than appeals to their race, gender, or age.

Marketers point out that their marketing campaigns are more challenging as a result. Traditionally, teenagers and young adults have responded to age and other demographic-related campaigns strongly. No longer.

One reason may be that they are much more flexible about race and gender. They consider themselves more racially liberal than their parents and see a society in which nonwhite children will be the majority in two and a half years. They are also more liberal about gay rights and marriage.

Marketing Appeals 

So how should businesses craft product and service appeal to this age group?

First, make appeals based on values, behavior, or needs rather than broad demographics. Savings are important to 85% of Generation Z’ers, for example, indicating that appeals to savings should be strong.

Second, make democratic appeals. Crowd-sourcing is very popular with Generation Z. Being asked how a product could be enhanced or marketed is likely to get strong and creative responses.

Third, advertise on social media rather than television. It’s true that television is old media to this generation.

Generation Z is 80 million strong and has $44 billion in purchasing power to its name. They tend to make family decisions re purchasing much more than previous generations at the same age. Businesses will do well to develop appeals to their needs and behaviors rather than demographics.

Share This Post: