Gen Z. You of course know all about them by now, how they’ve grown up online, in a world of economic unrest, with no choice but to lead the pack and fight against the climate emergency and social inequality that has been handed to them. Is it any wonder they’re also Generation Activist, Empathy and Awareness – the true voice of the people? They’re a collective force to be reckoned with, and for good reason.
But yet, Gen Z were one of the hardest hit cohorts of the pandemic; with the highest unemployment rates and stunted earning power, entering adulthood in yet more economic turbulence. The past year has dashed, or at least brought to an abrupt halt, many young people’s dreams for the future.
That hasn’t deterred them.
With this influential cohort making up 41% of the world’s population and set to become the biggest spending power in just over a decade, Gen Z needs to be taken seriously – they are shaping the future, not just for their generation, but for everyone. So what does this mean for brands?
Authentic conversations, foster meaningful connections
Well, first off, Gen Z are defined by their authenticity. They’re the generation that don’t idolise flawless – unfiltered, raw and honest. And they expect the same from the brands in their lives, seeking them out on shared values, expecting transparency as a minimum, as well as support in their mission to bring about change.
Their heightened awareness of social and political issues over the last year has only made them even more astute, and 68% of consumers expect brands to be clear about their values, according to a report from Kantar Monitor.
As a generation that has grown up in communities online, coming together around digital campfires, they are acutely connected to one another, the wider world, social issues and movements, and as a result, limitless information. This makes them the wised-up generation, so your actions must speak louder than words, or they will not hesitate to call you out. Your reputation is in their hands.
Finger on the pulse, ear to the ground – you must absolutely understand the culture your audience want to be associated with, their wants, needs, values and attitudes, and then create hyper-relevant experiences to match. This is of course true for any audience, but even more so for Gen Z who are the original youth culture creators of today.
A prime example of a brand catering to Gen Z’s forward-thinking, individualistic values is clean-beauty brand Glu, who was brought to life to help UAE Gen Zers to feel more comfortable in their own skin. Radically disrupting the beauty category and championing diverse, multi-faceted beauty, the new store due to open in Dubai Hills celebrates the nuances of beauty by empowering each and every one of their customers as individuals.
It goes without saying that relevance to your customer’s emotional and physical needs should be a foundation stone for every modern brand.
A blended balance of digital
Whilst they might be digital natives, the original Tik-Tok trailblazers and expect immediacy at their every touch of a button, Gen Z’s relationship with social media, interestingly, has become a nuanced one. Their mental health activist mentality has made them aware of the impact of social media, digital overload, and data privacy, and according to a study by Depop, they now acknowledge both the positives and the negatives of social platforms.
On the flip side of the same coin, digital runs through their veins; they are still socially savvy through and through, using social media as a platform for community, connection, inspiration, entertainment, education, discovery and gaming – to name but a few.
This digital duality means they now seek a healthy mix of equilibrium and escapism from the filtered world of algorithms – only spurred on further by the digital lives we lived in the pandemic – but their expectation for seamless, fast, convenient interactivity still remains steadfast.
While discovery takes place largely on social, 81% of Gen Z still prefer to shop in-store. This is good news for physical retail in every sense of the word, and it’s a behavioural shift that’s a sign of the blended conversations to come.
We believe that the stores of the future will be driven by the tech-native kids on the block; digitally-enabled, they will acknowledge the role that social plays in their lives, celebrating every channel for what it can do best to amplify the in-store customer experience. Intelligently connected, physical retail will reign supreme.
L’Oreal’s gamified, WeChat-powered phygital flagship concept store in Shanghai is the perfect example, fusing gaming, social and experience pretty damn neatly. A flower-adorned bike in-store gives you the chance to cycle virtually through the streets of Paris, allowing you to collect discounts, meanwhile every visit is intuitively linked to the customer’s WeChat account for the ultimate personalised, hyperconnected shopping experience.
Gen Z’s defining of the digital landscape – from bringing gaming into the mainstream, to ushering in the popularity of TikTok and video-sharing – means that you must remain at the forefront of this digital powerhouse, aware of their next move and their latest virtual hangouts, because they will only continue to be the tech-trailblazers of tomorrow.
Experience over product, always
Physical retail for Gen Z is about seeking experiences that go against the grain, that are out with the mundane and in with the extraordinary, every time. According to Kearney, 74% of Gen Z said that a “well curated store experience focused on a limited number of products” was either extremely or moderately important to them. That was back in 2019. Fast forward to 2021, and billions of consumers across the globe are now craving exciting, in-real-life experiences due to a serious lack of stimulus. Experience suddenly becomes even more important than ever before.
Creating standout stores with attitude is a basic necessity for this cohort; your stores must also be destinations, playgrounds for discovery, sensory-rich venues for excitement, game-play and social reward, curated and intelligently fuelled by their digital lives. All the while creating spaces for this community-obsessed cohort to gather together. The brands that offer experiences they’ll never forget – that excite and inspire – will reap the rewards, both in the short and long-term.
One such retailer is TX Mall in Shanghai. Attracting 40,000 shoppers every single day, this Gen Z hotspot is a ‘cultural landmark for the youth’, offering an eclectic mix of retail, clubs and food, providing a destination-experience that Gen Z’s can while away their days in.
Ultimately, the generation of the future, are in fact the retail of today. Gen Z’s drive to make the world a better place will revolutionise brand behaviour to be more transparent, sustainable and authentic. They will continue to shape the digital landscape of tomorrow, ushering in a dawn of retail that is connected and seamless, whilst transforming the true meaning of experience.
They’re the radical, go-getter generation bringing about the change we all need, and their rising expectations will undoubtedly raise the bar for everyone. Meet their high expectations and you will win their hearts, you will win their minds and – in doing so – win their spend, too.
41% spending power of the global retail revenue = a costly missed opportunity if you don’t wise up to this changemaker generation now.