How to Market to Generation Z

Marketing to Generation Z is important because of their tremendous buying power. But what gets them to buy can be different than older customers. Here is how to market effectively to Generation Z.

When it comes to market size and buying power, Generation Z is following hot on the heels of Millennials. If your business isn’t marketing to Gen Z, or isn’t marketing to them effectively, you could be missing an important source of customers. Here are facts businesses (and other groups) need to heed:

According to the Pew Research Center, Generation Z is comprised of people born between 1997 and 2012. Nearly 68 million in number, many are already wage-earning consumers; the oldest members of the generation turned 23 years old in 2020.

Estimates of the generation’s buying power vary depending on whose statistics you look at, but a report published by Google estimates the Gen Z US spending power could be close to $200 billion dollars when one accounts for the demographic’s influence on their parents’ spending. Ypulse puts the spending power of US teens aged 13 to18 at $34 billion.

Note: There are differing opinions about the cutoff year that divides Millenials from Generation Z, but Pew Research Center and others set 1997 as the beginning of Generation Z.

In addition to their influence on spending, Generation Z is likely to have an impact on US elections now and in years to come. According to a Pew Research Center, in 2020, one out of every ten eligible voters in the US will be from Generation Z. 

Thus, whether you are a retailer, nonprofit, or politician and have been targeting Millennials, it’s time to add a focus on Gen Z to your marketing efforts as well.

Generation Z characteristics

Although Gen Zers share a few similarities with Millennials, there are many important differences to consider in your marketing. Pew Research indicates, for instance, that Generation Z is more racially and ethnically diverse than preceding generations. They are also likely to be the most educated of any generation.

What does Generation Z value?

A priority for many Gen Zers is that your business either is outfitted for some larger goal that will benefit the world apart from making money or that your business at least doesn’t impede causes that benefit the greater good. TOMS is a great example of this. For every pair of shoes that are bought, they donate a pair to children in need.

In addition to social responsibility, Generation Z is concerned about environmental issues and as a result, they choose brands that are eco-friendly. One report found that 84% of Gen Zers are interested in buying products with a social or environmental benefit. So, if your product or service is eco-friendly, emphasizing this point in your marketing is sure to put you on the radar of possible Generation Z customers.

How to reach Gen Z with your marketing

You may have to change your advertising methods if you wish to appeal to Gen Z. Advertisements meant to capture the attention of Gen Zers have to be short and to-the-point since the attention span of an average Gen Zer is only about 8 seconds.

Video marketing is an effective way to capture the attention of potential Gen Z customers. Instagram, advertisements on YouTube, and Snapchat are all great options. A 2016 study showed that 71% of 13-17 year-olds spend over three hours a day watching videos online. A more recent report in the Washington Post indicates that overall, teens spend an average of 7 hours and 22 minutes a day looking at digital screens. That number isn’t limited to just video use, but it does exclude screen time used for school work. Keep videos and ads on these platforms short. With YouTube advertisements, stick to bumper ads that are only 6 seconds and are unskippable.

Gen Zers are digital natives. They’ve grown up using digital devices and much of their screen time is spent staring at smartphones. Gen ZInsights reports that 97.6% of Gen Zers across North America, Europe, Australia, and New Zealand owns a smartphone. Another study found that 53% use their smartphones to make online purchases. This means that businesses need to prioritize having a mobile-friendly site, including simple navigation and easy ways to check out items.

What Generation Z wants from advertisers

Generation Z has grown up in a world centered around technology and the instantaneous spread of information. When it comes to traditional advertising tricks and manipulation by brands, they’ve seen it all. When designing advertisements, it is best to use real people who have benefitted from your product instead of actors. Gen Zers feel more inclined to examine your product if they relate to the advertisement and see how the product or service will benefit them. Gen Zers want to purchase an experience, not an item. 

Generation Z wants to ensure that their privacy is protected at all times. As a matter of fact, according to a study done by NGen, 88% of Gen Zers agree that protecting their privacy is very important. So as a business, you want to emphasize your dedication to protecting the privacy of your customers.

Most Gen Zers want to have a better, more personalized shopping experience but, as previously mentioned, they’ve grown up with the internet, and as a result, they know all too well that what goes on the internet stays on the internet. When you go to collect personal data from your customers, ensure that you are as transparent about it as possible and emphasize your devotion to protecting your customers’ information

Using influencers to reach Gen Z

If you’re planning to use influencers to market to Generation Z, you’ll want to work with micro-influencers and digital creators, not big-name celebrities. Micro-influencers are Instagram accounts (or any other social media platform) in your business’s niche with only between 1,000 and 100,000 followers. Digital creators are simply those who became famous from being online. These kinds of collaborators are so effective because Gen Zers can relate to them.

Additionally, they tend to engage with their followers more and thus have a stronger connection with them than your typical celebrity may have with their audience. This makes their followers more likely to try out products that they recommend. It is also a financial win for you, the business owner, as partnering with traditional celebrities could cost you up to $825,000 depending on who you collaborate with, while many micro-influencers may be more than happy to show off your product in return for just a free sample.

Retaining Generation Z customers

The last big hurdle you have to overcome is customer retention. According to hbr.org, “acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one.” One difference between Gen Z and Millenials is that Gen Z is not as concerned with brand appeal as Millenials are. Additionally, Gen Z is not as motivated by loyalty programs. While it may seem like it’s hard to get Gen Z customers to stick around, there is a pretty reliable way: engagement. According to genzinsights.com, 76% of Gen Zers “want brands to respond to their voices and feedback — and view ‘responsiveness’ as a metric of a brand’s ‘authenticity’.”  Furthermore, 41 “will read at least five online reviews before making a purchase”.

Engagement is key to winning and keeping Gen Z customers

Gen Zers share twice as much positive feedback than negative, so obtaining a good amount of reviews is quite an important step. However, you also need to reply to those reviews. For positive feedback, make sure the message is personalized so customers don’t feel as though it’s the same line you use for all your responses. For responding to negative feedback, acknowledge the issue and say as sincerely as possible that you are doing everything in your power to resolve it.

Reach out to this generation for product ideas and participation in events, too. According to a survey done by IBM, 44% of Gen Zers would submit ideas for product design, 43% would participate in product reviews, 42% would participate in an online game for a campaign, 36% would create digital content for a brand, and 38% would attend an event sponsored by a brand. In order to make lifelong customers of Gen Zers, the best method appears to be engaging with your customers and allowing them to participate with your brand.

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