Gen Z Consumers // How to Stand Out and Connect to a Digital Shopper

Posted on Oct 31, 2018 By tpawelka Share:

Gen Z has endless options at their fingertips - here are some ways your CX strategy can lure them in and keep bringing them back

After a decade of obsessive focus on spending habits and work ethics, millennials are finally aging out of the spotlight. Focus is turning to the younger generation – Gen Z – and companies are starting to put more money into omnichannel offerings and expedited shipping to appeal to them. Even pizza companies such as Papa John’s and Domino’s are dumping money into online adverts and starting to wean off of television and radio commercials. After all, most of Gen Z will be streaming their television shows without commercials anyway. What will it take to reach some of the 68 million Americans that fall into the “Gen Z” category and secure them as customers?

Download New Gen Z ReportGen Z, the pre-teens and teens born roughly between 1996 and 2010, may as well have been born with an iPhone in their hands. They have never lived in a world without wireless internet, which has caused Gen Z to develop a sense of instant gratification and urgency in online shopping and shipping. For e-commerce companies, the focus for this generation is not just to sell a couple one-off items, but to actually appeal to one of the most diverse generations we’ve seen yet and to do it as they age. Once a customer has developed a sense of trust and familiarity with a business, they like to stay for life. More companies are trying to commit to a theme that will draw customers in early and keep them as they grow older.

By 2020, global e-commerce is expected to reach $4.13 trillion. By that time, 24% of Gen Z will be working and when combined with their predecessor Millennials, will make up 59% of the workforce. With this, comes significant spending power. Gen Z alone spends about $44 billion a year, and they influence an additional $600 billion in household spending, according to research firm Mintel.

As a result of Gen Z following a different communication style (cell phones, texting, chatting online instead of calling customer service), companies have had to shift their marketing spend to better align with where most eyes will see it. Matthew Litfin, a senior portfolio manager at Columbia Threadneedle Investments, said “This is a gaming generation and they do not like to have to talk to somebody. If you can make day-to-day commerce more like a game they can play on their phones, they are more likely to engage,” citing Domino Pizza’s early investments in online ordering – a category that now constitutes more than 60 percent of its sales. Digital efforts appeal to younger generations, the future of business, while also retaining the ability to call in an order.

Amazon's Biggest Lesson for E-Commerce CompaniesWhen it comes to ordering online and getting items shipped to their door, Gen Z has a very deliberate expectation: now. They are the youngest group of consumers currently and have not had much time to grow their own disposable incomes, so affordability is also a huge deal to them. Sure, free shipping is a great perk, but it is not the singular driver to shop online – price, on-demand, ability to access otherwise unavailable items, and better selection all weigh into this decision as well. In fact, 98% of Gen Z reported that they would abandon their cart at checkout if the shipping option of their choice was unavailable – and if this happens, 44% of them reported they would opt to buy from a competing online brand. To serve this increased appetite for lifestyle-centric deliveries, retailers need to have the capability to flexibly control and curate a range of shipping options easily. Learn more about Gen Z in this new report.

Another important factor for Gen Z is 24/7 accessibility. They want to be able to shop wherever and whenever they want, and conveniently. Having to flip between mobile sites and apps is annoying, and confusing back and forth will quickly drive this generation of shoppers away. Gen Z has a higher than average tendency to respond positively when online stores offer extreme convenience in the form of new types of shipping services, and negatively when faced with shipping related issues, which eventually leads to cart abandonment. Once a shipment is in transit, they want to be able to track it every step of the way.

Gen Z also cares more about “green responsibility”. According to a 2017 survey by Cone Communications, 94% of Gen Z believe companies ought to address social and environmental issues (as compared to only 87% of Millennials, and only 86% of the general population). One way to cut down on environmental harm is to cut down on the amount of packaging used to pack orders.

Selling to Gen Z is not just about enabling them to shop from the palm of their hands – it’s about orchestrating the flow of a collective experience. They are much warier of being advertised to, so simply upping the number of ads pushed to their cell phones won’t work. Gen Z needs an experience built start to finish around their lifestyle. They know how to work the system to get what they want – whether they have to order online, over the phone or on their mobile app. That is why it is so important to have an omnichannel experience that carries with them through their entire engagement.

It’s more important than ever to focus on the younger generation and start to build an encounter that they will remember positively. Focus on offering several shipping options, providing 24/7 accessibility, being environmentally and socially conscious and providing a consistent omnichannel experience. Throughout your experience with the Gen Z shopper, it’s important to remember one thing: they are skilled on social media. If you lose a shopper due to poor user experience or lack of shipping options, odds are they will tell their friends and family about it too.

[Download the New Report | Great Expectations: Shipping, CX and Gen Z]

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