Generation Z: A New Generation With New Challenges for Brands

Gen Z, Already?

For the past several years the spotlight has been on one generation: yes, millennials – the most studied and arguably the most sought after (or talked about) generation by brands and businesses to date. We, for one, have discussed: what brands they love, where they put their money, where they put their loyalty, why where they work matters, if all the “millennial advertising” hype is even worth it… Now, it seems the focus is shifting. The internet, advertisers, and marketers today are starting to pay a little more attention to those millennials’ younger siblings: Gen Z.

There are three major narratives floating about Gen Z:

1) The generation is just an exaggerated version of millennials: more distrustful, more digital, and more diverse.

2) Gen Z is not like millennials at all. They spend less, collaborate less, and care less about brand names.

3) Some combination of the latter. So, what is it?

Who Is Gen Z and Why Even Pay Attention?

When you dive deep into the available research and stream of news articles making claims about who Gen Z is and isn’t, it’s hard to make out fact from fiction. When it comes down to it, we just don’t know enough – yet. The studies ask too few people in too few areas at too few ages to make any kind of definite conclusions.

What we do know for sure is this: Gen Z is still young and developing. The oldest of the Gen Z generation is just about to enter the workforce – that means late teens/early 20s. Gen Z grew up during the Occupy Wall Street Movement. They were young when 9/11 happened. They don’t remember life without the internet or social media. Now, they are a generation of about 70 million – the most diverse and multicultural of any generation before – and everyone is paying attention.

New Spotlight: Generation Z

As a branding agency, we are excited to keep up-to-date on this emerging generation. Based on what we know and the current research out there, here’s what we can predict about Gen Z.

Experiences Aren’t Forever

We’ve talked a lot about building resonant brand experiences. However, Gen Z might be demanding a different type of experience than generations before. This is a generation who lives on SnapChat. And what differentiates SnapChat from other social media platforms? SnapChat’s entire identity is based on its impermanence. The photos disappear. And it doesn’t stop at SnapChat. Other platforms like Whisper and Secret are among the most popular with Gen Z – both of which offer the value of privacy within the guise of being “social apps.”

Our guess why? In a world of information-overload and constant availability, fleeting experiences feel unique and special. Brands that embrace the ephemeral might find new success with this generation – think experiential events, mixed medium, VR …experiences that allow individuals to shape them. This is exciting for brands who must step up with creative, innovative, fresh, and brief but lasting ways into this generation’s heart.

An Entrepreneurial and Innovative Spirit

Gen Z seems to be a notably independent generation. A recent HBR study found that ¼ of Gen Z students display interest in starting their own business. And according to Gallup, 8/10 kids want to be their own boss, and 4/10 want to start their own business. In fact, 70% of teens are already their own boss – self-employed and making money by teaching piano or selling clothes on YouTube – showing an increase from generations before.

This means businesses and brands are going to have to work hard to keep up. Innovation is even more of an expectation. Companies who want to attract young talent are going to have to work hard to tailor jobs that allow Gen Z to create, innovate, and disrupt.

Dreams With A Price Tag

Initial studies have shown one big difference between millennials and Gen Z: Gen Z cares more about money. According to a Lincoln Financial Group study, around 60% of them already have a savings account and 71% say they really want to focus on saving in the future. Many articles note that this generation worries more about college debt.

Two interesting examples of brands who are catching on to this thrifty nature are Spirit Airlines (a budget airline) and Stayful (an app for competitive boutique hotel rates). Both brands pride themselves on transparency and value – in short, you get what you pay for. And both have found immense success with targeting this emerging generation.

It’s not necessarily that Gen Z is scared to spend, they just want to make sure what they are buying is worth it. This means brands who are transparent about value should find success with this younger generation as well. We also expect brands who are able to offer and demystify financial planning tools will thrive with this generation.

Brand Is A Given. It’s What You Do With It.

What’s most interesting about Gen Z for brands today is the generation’s general mistrust of them. Especially the big ones. Claims aren’t enough for this generation. Neither are ads. They always look closer – because they can. The technology and the resources to dive deeper are right there. What’s the culture really like? Is it inclusive? What are the work conditions? How does their CEO behave?

Like millennials, authenticity and transparency are values that sit at the heart of this. That’s why we see this generation trusting individuals more than institutions. That’s why this generation cares about what’s in the news surrounding the brands they buy from. And that’s why just sticking a logo on a clothing line is not going to cut it (not that it did before).

Brands who want to succeed today have to work even harder to build their brand from the inside out. Invest in the culture and the leadership that will drive you in the right direction. Adapt more transparent practices. Figure out new ways to personalize. Don’t just rely on a logo (Gen Z isn’t interested in being a walking advertisement). Say what you stand for and let people experience your brand in a different way – in their way. Recruit and retain talent that exhibits the creativity to do so. As Gen Z evolves and comes into view, we believe brands have a big opportunity to do the same.

Keep posted for more about this emerging generation and more.

Emotive Brand is a San Francisco brand strategy and design agency.

Comments (3)

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  2. I really appreciate the insight here in this post and confident it’s going to be helpful to me and many others. I’m wondering if you or anyone else has additional sources for me to read further.

  3. Great post Saja. As a Gen Z, I can relate to this. It is accurate how entrepreneurial mindset affects this generations spending habit. As many of my friends tend to choose to make money online like reselling clothing rather than acquiring a regular part-time job.

    Looking forward to reading more of your posts.

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