As I was reading eMarketer’s latest report on consumer trends —this one about Gen Z consumers not trusting big business—I glossed right over the implications at first. It wasn’t until partway through that I realized just how frequently I’m reading about this generation as the new big gorilla of consumer spending. For so long, I’ve been tracking the trends related to Millennials, but increasingly, the commentary is shifting.
When I started in this industry, we were all talking about Baby Boomers and their level of disposable income. I’m pretty sure the discussion skipped over my generation—Generation X—maybe because we were Baby Boomers’ more digitally savvy mini-me. Then it was all about the buying power of Millennials and how they valued experience over traditional buying factors. Now we’ve moved on again. Except this time, the challenge is that traditional blueprints for any type of marketing messaging are out the window. That’s because Gen Z has a trust problem.
Not that I blame them. This generation has grown up in the age of social media, where trying to find truth and objective facts can be like trying to catch the wind. Who do you trust? It’s a problem, both for Gen Z consumers and for the marketers trying to sell them things.
In describing this challenge, eMarketer cite the following data:
- Only 42% of Gen Z trust companies. This was lower than Millennials (50%), although trust has fallen among both groups since 2018 (Salesforce).
- Only 48% of Gen Zers worldwide think businesses are having a positive impact on society (Deloitte).
- Only 53% of Gen Zers said brands come across as authentic compared to 61% of Millennials (Salesforce).
This matters because this more mistrustful generation now accounts for 40% of consumer spending. They not only have a higher number of transactions, but spend more per transaction than any other generation. But how do you market to buyers who don’t trust what you say? We can personalize the tar out of marketing communications, but if the audience doesn’t trust you, it’s not going to matter.
Here is where authenticity and transparency play a critical role. Gone are the days in which super polished content wins the day. Better to use real people in real situations in a way that comes across as genuine. In other words, when it comes to marketing video, an iPhone carried around the office carries more weight than an actor sitting in a studio. Customer testimonials and influencer marketing win out over slick ad copy and the angle of the product shot.
As eMarketer notes, reflecting diversity in those communications is key, as well. Gen Z wants advertising and marketing to look like a cross-section of our nation. I think about Dove’s Real Beauty campaign depicting real women and what they really look like, and Mattel with its Barbies of different skin tones and body types, even those in wheelchairs or with prosthetic limbs.
This generation is also much more aware of the capabilities of digital data harvesting and don’t want to be exploited by all the things that companies can learn about them. “Gen Zers are increasingly uncomfortable with how companies use their personal information and are becoming savvier and more cautious about what they divulge,” notes eMarketer. “They are less likely than older generations to feel comfortable seeing ads that have been personalized for them based on personal data that had been collected.”
I find it fascinating how different generations are so different, and how their shopping behavior can be completely different from the generation before. As Generation Z rises to become the big gorilla of consumer spending, it’s time for marketers to shift gears (and messaging)…again.
Discussion
By Gee Ranasinha on Dec 02, 2021
I can’t believe we’re still having these mindless and distractive discussions around customer marketing segments that don’t exist.
“Gen Z” isn’t a customer segment. Neither are “Millennials”, “Baby Boomers”, “Gen X’s”, or any other generation-based cohort. Just because eMarketer says it’s so, doesn’t make it true.
Quantifying a demographic simply based on age isn’t just lazy. It tells us absolutely nothing about consumers. Claiming that a group of people of a certain age have common behavioral characteristics is about as impressive as saying that left-handed people prefer McDonald’s to Burger King.
Marketers can do themselves a great deal of good by remembering what, in the realm of marketing, a customer segment actually is. A market segment is a group of people who think, behave, or respond in a broadly similar fashion. Unless it can be proven that a demographic group actually thinks and behaves differently from others, a segment isn’t a segment - it’s a stereotype.
Millennials are supposed to be more digitally-savvy, prefer WhatsApp to SMS, are more left-wing in their political proclivities, and value ‘life experiences’ over material objects. You know who else does all of that? My 75 year-old mother.
"Gone are the days in which super polished content wins the day.” Really? Someone better tell Unilever, Apple, or P&G. Of course testimonials and influencer marketing have their place. But - just like much of marketing - it’s not a zero-sum game.
I don’t necessarily disagree with the statement that “Gen Z-ers are increasingly uncomfortable with how companies use their personal information.” But to quantify such a characteristic around the metric of the year someone was born is ridiculous. People of every age, size, sex, or income level have concerns with personal data privacy and ad tracking. It’s one reason why there are over 760 million adblock users worldwide.
There’s a great graphic floating around LinkedIn at the moment. Since I can’t post it here (Adam: give us image uploads!) I’ll summarize in words: Prince Charles was born in 1948. He is male, and was born in the UK. He is wealthy, famous, lives in a castle, and has been married twice. You know who else fits this profile? Ozzy Osbourne. Is anyone really going to tell me these two individuals share similar characteristics around brand affinity or shopping behavior?
By Heidi Tolliver-Walker on Dec 02, 2021
Hi, Gee.
I totally agree with most of what you said. The graphic I remember shows Prince Charles and Mick Jagger. If you look back in my archives, I think I used it as a graphic in one of my posts years ago because I made many of the points you are making now.
At the same time, we do acknowledge that generational differences do exist. To say there are no differences between how one generation TENDS to think, prefer, or behave would be as untrue as saying that everyone in that generation thinks, prefers, and behaves the same way (as in the Prince Charles/Ozzy Osborne example).
Generations are shaped by societal influences, among other things, that tend to shape the way they perceive the world as a general rule. Does this make the generation homogenous? Of course not, and it's up to us, as the ones interpreting (and acting on) the data, to understand that.
To what extent are the data on preferences, attitudes, and behaviors significant? This is where comparisons between data sets are important. When you compare the data from one group to another group, and the research methodology is sound and there are statistically significant differences between them, we must acknowledge that those differences are there. It would be irresponsible not to.
What marketers do with all of this information is up to them. Because Gen Z is "more" mistrustful, should you write all of your copy as if all of them are mistrustful? Of course not. That's bad marketing. But understanding that this generation TENDS to be more mistrustful might inform how you come up with campaigns, how you further segment your data, and so on.
Because, of course, no data set should ever be used in isolation. It's one piece is the larger puzzle. Hence the value of personas over isolated demographic or other data.