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Over the past several years, Millennials have been the hottest topic in marketing. Just hearing the word conjures up a veritable buffet of emotions: Analysts try to understand them, marketers try to engage them, and Millennials themselves, for the most part, simply respond with an all-too-deliberate roll of the eyes. Good news is on the way for the largest living generation, however, as the spotlight finally begins its shift to the younger members of the next big thing in market segmentation: Generation Z.
Largely defined as those born from the mid-1990s to the early 2000s, this group represents the future of marketing, and has grown up in a world vastly different than previous generations. To better understand this upcoming consumer shift, experiential retail marketing company Interactions recently released “The Next Generation of Retail,” a survey of 2,000 Americans ranging from ages 14 to 19 that focuses shopping habits, brand loyalty, experience with technology, and current level in Pokemon Go (okay, maybe not that last one).
Like the previous generation, Generation Z values experiences over material goods. This demonstrates a continuing trend in which experiential rewards are crucial to include in any loyalty program reward mix. This rise in experiential value correlates strongly with the prevalence of social media, as younger generations are eager to post unique experiences on their profile as a “badge of honor” for having been there.
Members of Generation Z also share the technological know-how of their Millennial counterparts, being exposed to things like social media and smartphones from an even younger age than the previous generation. Contrary to the conclusions drawn from this fact, the generation prefers in-store shopping (64%) to online. Top factors for a positive in-store appearance include a clean store, friendly frontline employees, and a seamless checkout.
Loyalty marketers face good news and bad news from the report. First, the good: 80% indicated that they would sign up for a loyalty program if it meant discounts (89% of those surveyed considered themselves “price conscious”), meaning the resulting data shouldn’t be hard to come by for brands offering deals in exchange for engagement.
Now the bad news: The report also found that 81% would leave their favorite brand for a similar product of higher quality. This puts an incredible amount of pressure on marketers, who must work that much harder to retain customers who are driven, above all else, by individual product offerings.
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