Generation Z is the segment of people born in 1995 or later. This subgroup accounts for around 27% of the total population in the United States, with about 2 billion Gen Z members in the world as of 2023.
On top of that, Gen Z has tremendous spending power—over $140 billion, to be exact. Seventy-five percent of Generation Z spends more than half of the money available to them each month, and Generation Z makes up 40% of all consumers. Winning the trust of Gen Z today means securing a loyal customer for the future, as they are an upcoming and highly influential generation.
The Generation Z Market
Generation Z is the most diverse subgroup in the U.S; while 61% of millennials in the United States identify as non-Hispanic white, only 52% of Gen Z do.
The majority of Generation Z’s enormous spending power goes toward bills and other household expenses, but they also spend money on dining out, electronics, beauty products, entertainment, and clothing/accessories. Gen Zers spend almost $167 a month on expenses related to socializing. Families of Gen Z students spend about $1,600 per child on back-to-school shopping.
Gen Z have always had the internet as part of their lives, and, as a result of this, they are extremely tech savvy. Ninety-four percent of Gen Zers own laptops, and three out of four said spending time online was the primary activity they engage in during their free time, with smartphones as their device of choice. Seventy-five percent of Gen Zers say that they receive most of their information on social media, and that they follow at least one brand on social media.
Generation Z also tends to be brand loyal as long as the brand’s mission, product quality, and service continue to meet their high expectations. Two in three Gen Zers (66%) said once they find a brand they like, they will continue to buy that brand for a long time. Sixty-five percent said that rewards programs influence where they shop, and 60% said they are happy to be associated with their favorite brand. In order to earn this loyalty, brands must show that they have strong tech and market to Generation Z with clear, honest messaging.
Want to use personalized offers to acquire Gen Z customers?
Generation Z and Privacy
Not surprisingly, Gen Zers value their privacy more than previous generations:
- 87% report that keeping their personal information private was more important to them than popularity measures.
- 75% only allow location sharing for apps which require it to function.
- 58% toggle their location sharing according to how and when they want to use it.
It’s clear that Generation Z take their privacy seriously and will be loyal to brands that do the same. According to the Uniquely Gen Z study by IBM and NRF, less than one-third of teens say they are comfortable sharing personal details other than contact information and purchase history, but 61% would feel better sharing personal information with brands if they could trust it was being securely stored and protected.
Generation Z vs. Millennials
Gen Z and Millenials have many similarities—savviness with technology, concern with political issues, and strong connections with social media. But there are also significant differences between the two segments that are important for marketers to keep in mind.
Gen Z can be less focused and have shorter attention spans than Millennials since they grew up with the internet and are used to obtaining and processing information faster than previous generations. Millennials have an average attention span of 12 seconds, compared to 8 seconds for Gen Z.
This shorter attention span can also make Generation Z better multi-taskers, as they are used to operating multiple technologies at once. Gen Z makes up almost 40% of mobile users, and they often use up to five different screens (whereas Millennials average three). While both generations are digital natives, Gen Zers are more likely to say they are addicted to digital devices.
Prices and Discounts
With inflation on the rise, 30% of Gen Zers and 27% of Millennials are trying to spend less money. However, 26% of Millennials shop at discount stores compared to only 22% of Gen Z. More Millennials have families to provide for, so they are more likely to seek out discount opportunities.
Millennials want lots of information in their ads, with 58% wanting to learn everything they need to know from an ad without having to also visit the company’s website. For both generations, video ads are particularly effective. Millennials are slightly more comfortable with ads than Gen Z, with 36% of Millennials trusting online ads versus 32% of Gen Z.
All in all, capturing and holding the attention of Generation Z can require more work up front. Marketers should aim to convey their brands to Gen Z in under eight seconds to be sure to reach them before they move on to new content.
9 Gen Z Marketing Strategies
Today, many companies are seeing success when marketing to Gen Z by engaging with their desire to support brands that they see as authentic and socially engaging.
Here are 9 effective Gen Z marketing strategies:
Establish a Clear Voice
Gen Z loves it when brands project a strong personality. Content that is fun and lighthearted is popular among younger consumers. Using social media trends is a great way to leverage humor and make your brand appear relatable. Just be sure to stay current—trends come and go in the blink of an eye. Regardless, your brand should have a strong, unique voice.
Encourage consumers to interact with your brand by creating fun brand hashtags and asking people to tag your brand in posts about their products. Featuring user-generated content on your site is a strategy rising in popularity. So, if someone buys, say, a jacket from your brand, they might post a picture of themselves in said jacket and tag your brand. Then, you can share their image on your brand’s social media or website. That way you get extra publicity and they get to enjoy a moment in the spotlight.
Other ways to create a brand community include asking questions on Instagram stories, going live on TikTok, asking for feedback or ideas from consumers (i.e. what should the theme of our next launch be?), posting polls on social media (i.e. what upcoming product are you most excited about?), and hosting giveaways.
Leverage Influencer Marketing
Generation Z likes to be engaged by “real people”—celebrity endorsements are not as convincing. Gen Zers are more likely to be swayed by influencers on social media, particularly YouTube, with 1 in 5 teens reporting that they use YouTube “constantly.” Partnering with influencers can increase brand awareness dramatically; 65% of Gen Zers have bought something because an influencer recommended it.
Emphasize Visual Content
The top three social media platforms among Gen Z are YouTube, TikTok, and Instagram. What do these all have in common? They emphasize visuals. Gen Z consumers want short, snappy videos and eye-catching graphics. If you try to attract them with large blocks of text, they’re likely to just scroll past. When engaging this audience, it’s worth it to invest in quality visuals and content that boils down the essentials.
Take a Stance
Authenticity and social impact in brands is important to Gen Z. Research shows that 77% of Gen Z have done something to stand up for a cause they believe in, and they expect brands to do the same. Brands are working to convey to Generation Z that they are not just talking about social responsibility and change but are actually doing it.
Some causes that Gen Z tend to care about include:
- Diversity, equity, and inclusion
- The environment
- LGBTQ+ rights
- Mental health
- Gender equality
You can use cause marketing to your advantage by clearly establishing your brand’s values. Discuss your brand’s mission openly and back up your statements with concrete action, such as donating a percentage of sales to a non-profit or hosting events that support important causes.
Gen Z is the most racially and ethnically diverse generation yet, and they also support diversity in terms of gender and sexuality, with 59% of Gen Z saying that forms should provide gender-neutral options. To effectively engage this audience, choose imagery that reflects the diversity of this community, show that you care about issues regarding equality, promote inclusive language, and ensure you have a range of voices on your team. Remember, the key is being authentic and honest in these efforts.
Gen Z cares a lot about their values, and they are unafraid to call out—or even “cancel”— brands that don’t live up to their expectations. And with the sharing power of social media at their fingertips, one blunder from a brand can quickly become viral, leading to a massive loss in customers. The best way to combat this is being honest and open. If your brand does make a mistake—whether that’s using outdated language that is no longer considered inclusive or putting out misleading information about a coming sale—address the issue head on. Issue a statement as soon as possible taking responsibility for the mistake and saying how you will remedy it, both now and in the future. Taking ownership is the best way to impress Gen Z and win their loyalty.
Provide Text or Chat-Based Customer Service
Talking on the phone can seem intimidating or boring for a generation that grew up with texting as their primary form of communication. In fact, 85% of Gen Z would prefer communicating with brands via text or an automated system. So, make it easy for your younger customers to get in touch by offering customer service through social media messages, texts, or chatbots.
Personalized content is a proven strategy across marketing personas, but it’s an absolute must when marketing for Gen Z. In fact, 81% of Gen Zers prefer personalized ads, compared to 57% of Millennials and 42% of Baby Boomers.
To achieve the level of personalization young consumers want, brands need to use segmented marketing to really drill down into their specific audience. Data enrichment can help you fill out consumer profiles so you can offer more individualized campaigns, while retargeting campaigns help retain customers with personalized content.
Offer Exclusive Discounts
Seeding the market with gated, exclusive offers specifically designed for young adults is a powerful strategy for creating brand loyalty in the growing Gen Z market. Many Gen Zer might not be earning a lot yet, and with inflation up, they will be on the hunt for brand discounts. In 2022, discounts were the #1 reason why Gen Z engaged with a new brand on social media. And when a discount is gated for a specific consumer community, like young adults, the offer feels more valuable.
There a few reasons young adult programs are effective Gen Z marketing strategies:
- Expand Your Market Reach: Engage beyond students; tap into the diverse paths young adults take post-high school.
- Support During Transitions: Tailored offers can guide young adults through the student-to-professional transition.
- Foster Brand Loyalty: Early connections with consumers can seed lasting brand loyalty.
Verifying Young Adults with SheerID’s Digital Verification Platform
Gated offers feel personal and are cost-friendly, two things that Gen Z prefers. But because Gen Z has a shorter attention span and greater concerns about privacy, brands need to be careful about how they verify their age for exclusive offers.
SheerID’s Verification Platform protects your offer from discount abuse and makes it easy for young adults to trust and engage with your brand because it requires only the most basic personal information. It also provides third-party verification, which helps you make the most of your Gen Z marketing plan.