The Outside View: Millennials Versus Generation Z
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Both generations are young and tech-savvy and they might listen to the same music and binge Netflix shows, but when it comes to marketing to Millennials and Generation Z, brands and retailers must treat them differently.
Even Millennials — who are between 22 and 38 years old now — have to sometimes marvel at their younger counterparts, who were born into Wi-Fi-enabled lives with thumbs attached to smartphones and social media profiles as identity markers.
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The differences between these two generations can be small, but they add up to distinct shopping habits. And brands and retailers who keep those differences in mind are more likely to reap the rewards.
Sharable Content
Generations Z’s all-encompassing embrace of technology is a vital differentiator. One of our consumer studies found that Gen Zers carry up to five devices on average and spend more than seven hours a day on social media, continuously checking and refreshing their social media feeds every few minutes. Brands and retailers need to take advantage of the little time they have to grab their attention. That means communicating in quick bursts. It also means creating highly sharable content that is easy to digest and uses “language” to which Gen Z relates — words are so yesterday, try emoticons.
And video rules now for Gen Zers. More than 54 percent of them are fans of YouTube and visit the video-sharing giant daily. But Millennials turn to Facebook more often, a reality that should translate into different online strategies for each of the cohorts.
Technology for All
The demand for in-store technologies is common to both generations. A 2018 HRC Advisory consumer survey concluded that connectivity and positive social media feedback are among their top priorities. But over 90 percent of Gen Z said that a strong WiFi signal is important to their shopping experience. They’re also fans of other emerging technologies like “Magic Mirrors”.
Shopping Preferences
Gen Z has become an increasingly important influencer of consumer spending. Eighty-two percent of parents surveyed in the 2018 HRC consumer study said their Gen Z children sway their purchasing decisions, such as clothing, accessories and even vacations. Brands must be mindful of that statistic when trying to attract the household consumer and understand who to target.
Gen Z’s hyper connectedness means they’re constantly online. But, while they enjoy researching products virtually, Gen Z’s shopping behavior — especially girls — is focused in malls, too. They genuinely love the mall and the social, in-person interaction they find there. That’s good news for brands with a strong brick-and-mortar presence. It’s also interesting to note that Gen Zers want and demand reward experiences, with instant feedback and satisfaction especially important.
Millennials, on the other hand, prefer online shopping within the comfort of their homes — unless they are transporting their Gen Z children to the mall. Constant digital innovation is absolutely necessary to keep the Millennials engaged.
Money Concerns
Millennials grew up in a relatively healthy economy. Not so much for Gen Z, which was impacted early on by the Great Recession and are, unsurprisingly, more concerned about money and debt. That may explain why the generation is wary of student loans, concerned with debt overall and more entrepreneurial. For Gen Z, money and job security are top motivators. They are extremely competitive, with salary, benefits and advancement critical.
The Influencer Is Key
Gen Zers are fond of sharing. They post about everything and then wait for acceptance and recognition. They love posting pictures of things they are thinking of buying — and waiting for friends to like their posts before making a purchase. Friends are the influencers of choice in their world. Millennials, on the other hand, rank celebrity endorsements and other “influencers,” including their Gen Z kids, as most persuasive, something every brand and retailer needs to heed when marketing to these young shoppers.
Keeping It Personalized
The last thing Gen Z wants to be a part of is the herd. They treasure individual uniqueness, heritage brands and being able to express themselves as they like. When marketing to them, diversity is key. (Considering that they want to be in control of their purchasing choices, it only makes sense that Gen Z prefer gift cards to gifts.)
While Millennials and older generations may be content wearing brand logos on their chest, the Gen Z prefer personalization. They like the simple, basic colors — black, white, gray — to which they can then add their own personal flavor. They don’t want to advertise a brand, they want to express themselves.
Show You Care
And let’s not forget that, unlike Millennials — known less-than-kindly as the “Me Generation” — Gen Zers are highly conscious socially, often advocating on behalf of issues they care about. Brands and retailers will be rewarded for embracing transparency, ethical practices and for promoting causes and values that Gen Z holds in high regard.
Though similar in many ways, the differences between these two demographics are increasingly important in the ever-complex world of retail. For a brand or retailer looking to engage with either or both, understanding the distinctions could make all the difference.
Farla Efros is president of HRC Retail Advisory, a leading specialist retail consulting firm that works with retailers to help them profitably adapt to the complex, changing digital retail environment.
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