We are living in an era where the latest generation, Generation Z (or Gen Z and Gen Z'ers), are coming of age, entering the workforce and making financial decisions. And, with their spending power valued at $44bn, according to Futurecast, companies simply cannot afford to overlook them.
However, having grown up in an intensely digitized world, they are a generation whose values and attitudes differ extraordinarily from the generations who came before. So how can companies authentically engage with them?
We spoke with Meredith Ferguson, managing director of DoSomething Strategic, a "young people and social change agency", about what Gen Z'ers are all about and how brand's can form genuine connections with these individuals.
Innovation Enterprise: Can you outline the work that DoSomething Strategic does with young people?
Meredith Ferguson: We activate young people for purpose. DoSomething Strategic is the data-driven consulting arm of the non-profit DoSomething.org, leveraging insights grounded in activating millions of young people in social good for more than 25 years. Now more than 6 million members strong around the world, our expertise helps companies and organizations connect with and engage their own base of young people in purpose.
IE: The distinction is far from clear for a lot of people, so can you explain how Gen Z differs to millennials?
MF: Gen Z, those born between 1995 and 2015, is the most racially and culturally diverse generation in US history. They refuse to be held down by traditional ideological boxes. They have never known a world without technology, but that doesn't mean they don't realize its limitations: More than half of young people prefer in-person interactions over text and email, because experiences matter.
Despite the common narrative, they show up; 62% of young people volunteered at least once in the past 12 months, and of those who do volunteer, 49% do so at least once a month.
IE: What do Gen Z'ers expect from a workplace/company that the generations before them did not?
MF: Gen Z expect the companies they work for to reflect their own values and purpose. They are more loyal and more engaged when employers provide them opportunities to make an impact on social and environmental issues – much more than a once-a-year volunteer day.
Gen Z is also much more entrepreneurial than earlier generations: 72% of teens say they want to start a business someday. Successful workplaces will seek to nurture this independence and empower people within an inclusive, transparent culture.
IE: And what do Gen Z'ers expect from companies/brands they use?
MF: They expect a lot more than high quality products (but quality still matters). Of consumers ages 13 to 25 78% are more likely to buy a product or service from a company that gives back to society, 56% are willing to pay more to buy a product or service from a company that gives back and 69% believe brands should stand up for what they believe in, even if controversial.
However, leading with a purpose statement is no longer enough: Half of respondents to our recent survey say that it is important for a company or brand to have a social change initiative that consumers can be a part of.
To truly stand out, companies must engage with young people and make them partners in their impact.
IE: Growing up in a society which is becoming increasingly suspicious of it, is social media going to remain relevant as a tool for speaking to Gen Z'ers?
MF: Privacy matters to young people, so if companies fail to live up to the trust demanded of them, they will lose relevancy.
On the whole, Gen Z values more personal communication. SMS and one-to-one messaging apps like WhatsApp are quickly becoming the more effective means of communicating with young people in a meaningful way.
IE: Do you think influencer marketing has had its day?
MF: The definition is changing. Gen Z want to see themselves reflected in order to connect, so para-social marketing and micro-influencers are much more effective. These influencers do not have a ton of followers but instead connect as more relatable peer. It's all about realness.
IE: How do you predict this generation is going to change marketing practices?
MF: They are going to challenge all of us to do better.
60% of young people believe that a brand's ads should include the company's values and beliefs. However, a company has to first be walking the walk before jumping on a purpose bandwagon – young people can easily sniff out (and will call out) anything that is disingenuous or opportunistic. Consider it a call to action to better inform, entertain, and, above all, add value, in order to create engaging brand content for young consumers.
Meredith Ferguson, managing director of DoSomething Strategic is speaking at Innovation Enterprise's Content Marketing Summit in New York on December 6–7, 2018. Check out the full agenda and book tickets HERE.