Generation Z : a new emerging generation
Just as retailers begin to gain clarity on what makes Millennials tick, a new generation – Gen Z – is emerging that widens the digital divide even further. The differences and evolving similarities between Millennials and Gen Z will have a profound impact on retailers worldwide, as companies attempt to reach the two most digital generations yet. Therefore, it is key to have a good understanding of each generation’s behaviour to recognise the implications for retailers and to appropriately reach each generation.
Gen Z stretches the digital envelope by starting with Social Media, which has a significantly greater impact on Gen Z shoppers purchasing behaviours than it does on Millennials, and this younger generation are expressing a greater willingness to buy products and services via the channel. Gen Z is also 60% more impulsive and impatient compared to Millennials, which highlight the need for quicker delivery means to make shopping easier and faster.
In addition, while there isn’t a significant difference in age with the younger millennials, Gen Z shoppers are far more likely to experiment with new services that retailers provide such as voice-activated ordering or automatic replenishment programs or concierge services like Apple’s Siri, Google’s Assistant and Amazon’s Alexa artificial intelligence platforms.
Source : @Accenture
Differences are leading to the below implications for retailers
- Don’t abandon stores. Among Gen Z, the majority still prefer visiting stores to make their purchases even if they are more likely to interact with in-store, self-service digital information sources. The store needs to be an experience that is an extension of the brand. The challenge for retailers is to move away from selling products and toward creating experiences and telling stories – finding innovative ways to participate.
- Focus on cool social media. Like Millennials, Gen Z shoppers mostly buy items on three factors; lowest price, seeing products in stores and reading reviews. However, Gen Z consumers place a greater emphasis on listening to friends and family and turning to social media for inspiration before deciding what to buy. Yet young people are quick to move to the latest channel, so being nimble is key for retailers.
- A need for experiences and speed. Experiences should be something that Gen Zs will want to share. Consider partnering with third party companies to enhance the customer experience.
- Overload of feedback. Gen Zs value feedback from their family and friends, suggesting that retailers no longer own the review process. Brand should also look at collecting shopper product testimonial videos – an authentic approach that adds tremendous credibility. Social listening capabilities and making this a prominent PR focus will be critical.
- Get closer to the customer. Gen Z shoppers are open to new shopping models. This is a real opportunity for retailers to secure new customer data. And gleaning insights successfully can increase the lifetime value of each customer.
Source : @Accenture
Overall, Gen Z will accelerate and amplify many of the hurdles retailers currently face in serving Millennials, including the impact on purchasing channel preferences, how shoppers choose what they purchase, and their effect on pricing, brand loyalty and the need for speed. Retailers will need to evaluate if the differences represent opportunities or challenges.
Author : Jessica Guerra (Accenture Management Consulting)
Source Image à la Une : @Accenture