Gen Zers are taking over Millennials as a leading market segment. Researchers spent years decoding Millennial behavior, whose technology-driven behavior transformed industries, entire economies, cultures, as well as our environment. Now, it’s time for the spotlight to shine on the newest stars, the first generation of truly digital natives.
The latest Generation Z trends show that members of this age group are quickly gaining ground and making their presence felt in today’s economy.
However, this transition suddenly experienced an unexpected turn as the entire world was engulfed by the COVID-19 pandemic. How are the Gen Zers faring so far in this global health crisis? In this article, we’ll show you the latest Gen Z trends that can help you get to know your newest target market better, during and after the pandemic.
To eliminate confusion, let us first define Gen Z. Generation Z is the generation after the Millennials. Specifically, they were those born from 1995 to 2015.
Such categorization came from most researchers, who also classified generational breakdowns into separate groups (CGK, 2020): the Baby Boomers, born from 1944 to 1964; Generation X, born from 1965 to 1979; Generation Y, also known as Millennials and born from 1980 to 1994; and then comes the Generation Z.
Now, you must be asking what Gen Z means to your business and why you, as a business owner, should care how these people choose to live their lives. The answer lies in this forecast: in 2020, Gen Z became the biggest generation in America at 86 million, surpassing Millennials by almost 4 million (Knoema, 2020).
And over the next two decades, Gen Z is forecast to increase by 2 million more due to migration (Knoema, 2020). In other words, Gen Z means business, and they are the next batch of customers you’ll be serving for a long while.
Source: Knoema (2020)
Understanding Gen Z’s consumer habits (NPD, 2019) can be vital to the success of your brand. After all, the oldest members of Gen Z are 24 years old this year, capable enough to consume products of various kinds. Gen Z already holds a whopping $143 billion of buying power as of 2019. This figure demands attention and can catapult revenues to new heights. That being said, let’s take a more detailed look into the latest trends among Gen Z-ers.
COVID-19 has changed the entire world and how people live their lives. And this change, as most experts say, is likely the new norm today and for years to come.
Like other generational groups, Gen Zers think they are the most affected by the pandemic and will likely be for the rest of their lives. Same as how Millennials “own” September 11 of 2001 and World War II for Traditionalists, the global coronavirus health crisis is affecting the growing years of Generation Z, more than any other generation.
For one, Gen Z workers consider themselves as the most challenged when it comes to adjusting to the demands of remote work. In fact, over 33% say that working from home has adversely affected their work/life balance and suggest that their companies should provide them with the necessary tools to be more efficient in performing their remote work (CGK, 2020).
Likewise, an SHRM study found that around 50% of Gen Z employees experience burnout from their work (SHRM, 2020). Moreover, another study found that the majority of Gen Z are worried about their financial stability (80%), their employment prospects (67%), and being left behind in their studies (50%) (CGK, 2020).
Over the past years, we’ve seen how more and more businesses are opening up to gender-neutral products, and for a good reason: Gen Z reports being a generation more accepting of non-binary products. Gen Z’s power extends in allowing a new wave of acceptance that’s not restricted to any gender at all. With this, various brands like Sephora and Telfar took the major steps to a more accommodating and gender-neutral industry.
As shown in several studies, binary-gendered options are a thing of the past. Back in 2015, Facebook, apart from the male and female options, started adding a third one: the custom option, where users can select from 58 different identities, such as androgyne, trans-male, trans-person, and more, prompting other brands and companies from various industries to do the same. Milk Makeup, a cosmetics brand, followed in 2016 by launching a makeup campaign that includes everyone, starting from trans models to cis straight men wearing makeup.
This shift to gender-neutral products opened new doors for businesses to expand their brands. This also allowed them to relate more to Gen Zers and retain them as loyal customers. The strategy improves customer experience for Gen Zers. Instead of products “made for men” or “made for women,” brands are using product categories instead and getting rid of stereotypical gender roles. Such a trend is expected to continue in the coming years as businesses prepare to cater to the demands of the new generation.
Gen Z’s preferences in food are defining the future of the food industry. A study revealed that Gen Zers are extremely health conscious in their food choices, with 67% of them considering the nutritional content of their food. According to the American Egg Board, Gen Z’s food choice focused mainly on three things: social media, convenience, and health (American Egg Board, 2020). They are also more likely to consume plant-based products, in contrast to their Millenial predecessors, which means they are more open to becoming vegetarians.
Because of COVID-19, Gen Z households spent $760 on food on monthly basis, with 72% (or $550) for grocery items (Food Industry Executive, 2020). Likewise, 52% of Gen Zers were unlikely to shop in-person, while 34% are intending to sustain their high online spending rate even when the pandemic is through (American Egg Board, 2020).
It is worth noting that in 2016, reports say that Gen Zers already spent $78 billion on restaurants, and not many of them are of legal drinking age yet. Restaurant owners find Gen Zers are more open to authentic tastes and also more willing to try out new and out-of-the-box cuisines, which allows businesses in the food industry to be more creative and trendy with their menus.
Additionally, a study by Packaged Facts found that Gen Zers prefer eating snacks throughout the day instead of following the traditional three-course meal. This snack trend will continue in the coming years, thanks to 23% of Gen Z, who say that they prefer appetizers and snacks as opposed to regular meals. Thus, businesses in the food industry, apart from utilizing technological tools like restaurant management software, now have menus that offer smaller portions of their food to attract more Gen Z customers.
As a generation shaped by the internet, Gen Z consumers take online product reviews to heart. According to Social Media Link, 96% of Gen Zers often take time to read reviews or recommendations for products they are considering buying. Aside from using the most popular social media sites, online reviews are popular among Gen Zers, too, with nearly 8 out of 10 reading them before closing a transaction.
This trend emphasizes the importance of consumer reviews. Gen Z or not, positive reviews always lead to better profitability of your business, and thus, investing in reputation management software can pay off in the end.
Today’s current headlining issues, from immigration, sexual assaults, mass shootings, to environmental decline, are affecting the whole world, and it can be too much for anyone. With these issues plus, other internal and sociological factors, Gen Z becomes the generation feeling the impact more as compared to their predecessors. After that, they are the ones most likely to report mental health concerns. And Gen Z, being a big part of today’s workforce, considers mental health as a factor that affects their work environment.
Prior to the pandemic, a study found that many Gen Z workers usually suffer from anxiety and stress. Its follow-up study found that the stress levels of Gen Zers appeared to have declined, likely because of the general shift to remote work and the slower pace of life in general. Nonetheless, the study found that 48% of Gen Zs feel anxious or stressed all or most of the time (Deloitte, 2020).
In an earlier study, nearly 9 in 10 Gen Z adults report having at least one or more emotional or physical symptoms because of various stressors in their lives, according to a study by the American Psychological Association. About 58% report being depressed or sad, and 55% experience a lack of interest, motivation, or energy. This leads to companies encouraging workplace wellness programs in an attempt to take care of the mental health of their employees. As a result, employers can minimize the health care costs allotted to their businesses and workers.
Source: Deloitte (2020)Designed by
Political shifts, changes in education, and other social changes drove Gen Zers to become the most ethnically and racially diverse generation in the history of the United States. A study by the Pew Research Center reveals that 52% of Gen Zers are non-Hispanic white (Pew Research Center, 2019). In the next 10 years, Gen Zers will grow more in population and can make the majority of the population racially diverse.
With Gen Z considering diversity as a positive asset, businesses are prompted to develop a more inclusive and diverse brand, extending even further beyond advertising and products. Emarketer’s study results show that about 6 in 10 Gen Zers say they prefer seeing ads that have diverse families in them. They are also more likely to support brands that are proactive in tackling racial issues.
This only goes to show that Gen Zers are pickier when it comes to choosing companies to work for and brands to support. As a racially diverse generation, they need assurance from brands that discrimination won’t be tolerated. When doing business with Gen Zers, it’s crucial to take into consideration not only the market’s similarities but also their differences, leading to a more expansive product line.
Sustainability is another thing to consider when dealing with Gen Zers. Along with Millenials, Gen Zers are pushing for a more sustainable and eco-friendly market in various industries. For younger generations, a product’s ecological footprint is very important. They seek high-quality and long-lasting products as opposed to disposable items. At the same time, sustainable materials find their way into this environmentally conscious generation.
One example is the clothing line Tentree. It successfully gained a massive social media following worldwide right after launching products that use only sustainable materials. The brand also associated with supply chain partners who are socially responsible. This led to an influx of traffic on their website due to an increase in international web visitors.
Gen Z respects brands that are highly conscious of the marks they leave on the environment. In a study by FirstInsight, about 73% of Gen Zers are willing to pay more for environmentally-friendly products (First Insight, 2020). Meanwhile, the same preference was shared by 68% of Millennials, 55% of Generation X, and 42% of Baby Boomers.
Source: FirstInsight (2020)
Today, Gen Z consumers expect more from brands and companies. One such expectation includes taking a stand on ethical issues. Before purchasing an item or supporting a brand, Gen Z first needs to know who made the product. Where the product is from and what was the process from which it was created are also their concerns. Consumption for them is of ethical concern, and they tend to stay away from brands that have ethical issues or are ignoring them.
It takes only minutes to search for someone’s background on the Internet. Hence, companies and brands need to be careful in maintaining a good image. That also includes a satisfactory level of handling ethical issues. According to a study, 62% of Generation Z are more inclined to purchase from sustainable brands (First Insight, 2020). Incidentally, 2020 is the year that the first batch of Gen Z joined the global workforce.
These trends lead companies to meet the ethical demands of Gen Z consumers. Marketing and work ethics are suddenly converged into one. Therefore, organizations need to be more careful in choosing which issues they should engage in. They should also ensure that they select the right persons to represent their brand.
Generation shifts play a vital role in setting up consumer behavior. Each generation’s views can affect a broader population. Gen Zers, however, are the first generation of digital natives. This means their views and behavior are heavily influenced by technological innovation. And as such, it speeds up technological trends, affecting the market of various industries.
Likewise, because they feel they are the most affected by the pandemic, employers and businesses should better take note of what they demand since they are the largest generational group at present. Catering to their preferences will also benefit businesses mainly due to the strength of their purchasing power.
Finally, as Gen Zers overtake the previous generations, they bring with them new trends and behavioral patterns. These are what you’ll need to keep in mind as Gen Zers become future employees or potential customers. But if you’re looking for ways to serve your general customers even better, you can take a look at some of the best customer service tips we have compiled.
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