Understanding Gen Z: The New Generation of Consumers

Gen Z consumers have purchasing power and are ready to spend on brands that speak their language

Meet the newest generation of consumers: Gen Z. Roughly defined as people born between 1995 and 2012, this digital-first generation is predicted to account for 40 percent of all consumers by 2020, and they currently influence around $4 billion in discretionary spending. They have purchasing power and are ready to spend on brands that speak their language.

But listen closely—these Gen Z consumers are not millennials 2.0. And they want brands to know that.

As digital natives, there hasn’t been a time where Gen Z was not connected to the online world. They’ve grown up surrounded by digital content and rely heavily on media to stay in touch with what is happening in the world. They can smell inauthenticity from a mile away, online and offline—these customers will unfollow, delete, or filter out any brand that doesn’t have the right tone or a message that doesn’t speak to their values.

Unlike millennials, Gen Z is cautious about where they spend their money. They grew up in the 2008 recession and are much more risk-averse than their Millennial siblings. One third have bank accounts in their names and 60 percent have a savings account—more than any other generation has at this stage of maturity. But this generation isn’t just money conscious. They are hyper-aware of social issues and care deeply about politics -- and they expect the brands they support to do the same. Over 50 percent of this generation says that knowing a brand is socially conscious influences their purchase decisions. These shoppers are intentional, deeply connected, and influential. It’s not enough for retailers to simply sell a product or service—brands need to have a purpose. To capture the hearts, minds, and wallets of this lucrative customer group, retailers need to think differently. Here are a few techniques brands can use to connect with Gen Z.

1. Understand your audience as more than a basic segment

If you sat down with two “urban, female, middle-class, nineteen-year-old digital natives,” you might be surprised to find their preferences and habits shockingly different. Lumping Gen Z-ers into a single segment so they see the same message limits retailers from real growth and connection to this audience. Customer populations are far more nuanced—represented by thousands of data points, not just a narrow handful. Savvy Gen Z customers are demanding relevant, customized experiences. For brands, a digital artificial intelligence hub is necessary to collect, test, and act on the data for each unique consumer.

2. Be authentic and champion your brand values

People want a brand that speaks to them and their lifestyle. Especially for Gen Z, brands must create a strong value system and stand by those values in order to be memorable. Remember, this generation is socially-conscious and politically motivated—they love taking a stand for what they believe in and enjoy shopping with brands that do the same. It’s a must that marketers update buyer personas and solidify your brand values because this group has real buying power. Gen Z deserves to be a part of your strategy at the beginning, so you can successful tie your brand and product to their beliefs.

3. Double down on personalization

To Gen Z, personalization is simply an expectation. Almost 40 percent of the generation thinks it’s cool (not creepy) to receive an ad in their social media feed for products that relate to their interests and shopping habits. Look at Netflix or Amazon and their predictive personalization—that’s the standard to which Gen Z holds all other brands. Gen Z wants to interact with brands that engage and deliver value at the right moment, wherever they are in their browsing journey. Brands using AI marketing technologies can gather behavioral, profile, and transactional data on consumers to create more complete profiles and make authentic recommendations.

4. Push omni-channel because Gen Z isn’t just online

There’s no doubt that digital means a lot to Gen Z—some check their social media accounts almost 100 times a day. But 80 percent of them still look forward to shopping in-store and 65 percent want to see and feel products before they buy. For retailers, this means the omni-channel experience is more important than ever. These shoppers want an immersive and cohesive experience both online and offline, so Gen Z feels understood and connected with during every point in their buying journey.

Explore the rise of artificial intelligence marketing (AIM) and the implications for marketers, strategic thinkers, and global brands as they stretch to reach today’s informed, demanding, and connected consumer, download The CMO's Guide to Artificial Intelligence Marketing.

About Amplero

Amplero lets brands be human again.

Despite the exponential growth of customer data, major brands still fail to understand individual consumers. Moments of interaction on the phone, in the app, or at the store, don’t connect. Each channel of communication is driven by its own data and automation rules.

But where humans and existing marketing systems are overwhelmed, artificial intelligence marketing (AIM) thrives. Amplero now enables customer-obsessed brands to build lasting relationships at a scale not humanly possible. No more mindless automation. No more fragmented interactions. No more feeling misunderstood.

Launched with AI at the core and used by companies across the globe, Amplero’s award-winning AIM technology experiments, learns, and optimizes each interaction as customer relationships evolve. Intelligently orchestrating meaningful, individualized cross-channel experiences, Amplero AI Marketing Cloud drives measurable lift for the metrics that matter most.

As a recognized leader in the AIM category, Amplero was named to the “Top 5 Most-Promising AI Startups” by VentureBeat and “CB Insights AI 100” featured in Fortune Magazine. Amplero founder and Chief Scientist Olly Downs, PhD, holds 35 patents in machine learning and computational mathematics.

To learn more about how the future is human, contact us today or connect with us on Twitter, LinkedIn, and Facebook.