As we round the corner into the holiday season, there is a looming concern on many of our minds: How will things play out, and are we getting a taste of the reshaping of society and shopping as we know it?
Now well into the throes of another wave of Covid-19, many of us might be feeling overwhelmed, nervous or stressed out this holiday season.
But what I believe the pandemic papers over is a once-in-a-generation shift in consumer behavior — a shift that was poised to be incredibly disruptive and now, courtesy of Covid-19, has been accelerated: screen time. We’re seeing an unprecedented uptick in balancing screen time at work and play. I want to focus on the most digitally savvy generation yet: Generation Z.
According to a survey by ParentsTogether, a parent-led organization that polled more than 3,000 of its members via Facebook Messenger in April, 85 percent of parents are worried about how much time their kids spend online. What are the long-term effects of this? From my perspective, Gen Z is sure to have a different childhood and formative years than consumers of years past, but there is hope.
It might seem elementary to call out screen time, but make no mistake: I believe this trend has a far-reaching impact that could shape how brands market to Gen Z, how Gen Zers buy and, ultimately, which businesses succeed in this new retail landscape.
How will things play out this holiday season?
With this surge in screen time, I believe retail online is about to be disrupted in a major way.
Some experts are predicting an increase in online buying. Deloitte, for example, has estimated there will be a holiday e-commerce uptick by as much as 25 percent or 35 percent — between $182 billion and $196 billion — which is up from 2019's holiday e-commerce growth of 14.7 percent (or $145 billion).
And considering that McKinsey & Co. has estimated that Gen Z will have the spending power of $150 billion and account for 40 percent of all consumers by the end of this year, I consider this generation one to be reckoned with.
What does this mean for marketers?
According to a recent McKinsey study, a shocking 75 percent of consumers are shifting brand loyalty and shopping habits as a result of the pandemic, and generational patterns are taking shape. Millennials and high-earners, for example, are "leading the way in shifting spend online across both essential and nonessential items." Gen Z, on the other hand, is gravitating more toward online purchases in specific categories, such as apparel and footwear, at-home entertainment, and food takeout and delivery.
These generational trends related to Gen Z are worth paying attention to. With the aforementioned buying power and consumers' increased screen time, marketers cannot ignore this group. I suggest migrating all forms of advertising and marketing messaging online, or else brands risk fading into obscurity.
Apparel and footwear, at-home entertainment and food takeout already stand to benefit from Gen Z's current purchasing behavior. Products and services outside those industries need to find new ways to market their offerings to appeal to this new market. Campaigns that not only speak to Gen Z's values but also are in formats that the generation is most receptive to, such as memes and short-form videos, stand the most chance of succeeding.
But it’s not as simple as using the same digital tactics that Gen Z is familiar with. Given their status as digital natives, your business must adopt that same mindset. There's a sentiment I hear many people express: "Customers are no longer loyal." I would argue that they never were; they just didn’t have a choice. When a consumer entered a brick-and-mortar store in the past, they had a finite number of options. Courtesy of that little device in their hands, Gen Z is never more than a few clicks away from an alternative product.
Look to deepen your relationship with Gen Z, beyond the frivolous holiday marketing efforts of sales and promotions. Gen Z has demonstrated a conscientious attitude toward consumerism far in excess of that held by previous generations. Gen Z is looking for brands that not only sell products they want to buy, but also share their values and do their bit to make the world a better place.
Be warned: This doesn’t mean you can greenwash your efforts with some philanthropy or token gesture. Gen Z is exposed to more advertising more rapidly, courtesy of their use of digital channels. Consequently, they are increasingly skeptical and wary of brands that try to curry favor with them purely to push a product. Instead, you must be able to demonstrate through genuine, authentic campaigns that your company lives and breathes its values through every action it undertakes and every interaction with the discerning Gen Z customer.
Marketers would do well to heed the adage: If you can't beat them, join them.
