“Z-Tail” Has Entered the Chat: How Brands Can Align with Gen Z’s Changing Retail Expectations
Author: Go Studio
December 14, 2023

A New Year approaching means strategy meetings with brands and merchants arguing over how to attract Gen Z consumers in 2024. Those meetings can sound like everyone asking questions to a Magic 8 Ball. Will this innovation grab their attention? What about that one? Instead of waiting for a little blue triangle to spout advice, let’s step back to consider who these young consumers are and what they want.

Gen Z consumers, or those born between 1997 and 2012, grew up in the digital age. The Internet, social media and smartphones all became commonplace during this time, molding Gen Z consumers into incredibly tech-savvy shoppers. Such technology and information access also exposed them to unique challenges ranging from mental health and environmental crises to financial instability and volatile job markets. These young consumers are well-versed in the issues impacting themselves and their communities … and they want to put their dollars towards new status quos.

How does that mindset apply to retail? Read on for a Gen Z persona we compiled to help brands and retailers understand what their future customers may soon demand from the shopping experience, what challenges they should prepare for, and the innovations that may position their businesses for success.

 

“Z-Tail” – How Gen Z Navigates Retail

 

As Gen Z consumers enter their early 20s, the influence they have on retail is growing exponentially. These new expectations for the shopping experience – which we’ll call “Z-Tail” – can be summed up in a few words: experiences, influencers and emerging payments.

Experiences: Younger shoppers typically prioritize experiences over materialism. This is most evident in the travel, hospitality and restaurant industries. Many Gen Z consumers would rather spend their money on an interesting trip, a memorable show or a fancy dinner instead of the latest gadget. Why? Financial limitations are a factor as young workers were hit hard by job losses during the COVID-19 pandemic. The other factor to consider is sustainability (don’t forget, Greta Thunberg is Gen Z). Young shoppers want to limit material consumption, and that has manifested as a preference for experiences over things.

Influencers: From billboards and print to TV and radio, traditional advertising is becoming more obsolete every year. Gen Z grew up with the Internet and social media, so it isn’t surprising to learn that these channels also inform their shopping choices. In particular, influencers have become the go-to way for young consumers to learn about new kinds of products, trends or experiences to which they can aspire.

Emerging Payments: Just as social media has overtaken traditional advertising, personal payment apps have emerged as a popular choice for Gen Z consumers compared to traditional payment methods such as credit cards. They still like cash, but the ways they use it have evolved. Paper money becomes digitized and stored in virtual accounts – think PayPal or Venmo – that they can access directly from their phones. Additionally, Gen Z consumers are more often savers instead of spenders, so they expect the stores they visit to accept their preferred payment methods so they can reliably manage their finances.

Experiences, influencers and emerging payments – got that? With these three topics in mind, we can make more informed decisions on the type of innovations and technology that may help merchants engage Gen Z consumers. In other words, you’ve taken your first steps towards “Z-Tail” experiences.

 

Aligning Your Brand With “Z-Tail”

 

Here are a few steps and solutions that businesses can consider to stay ahead of the competition and attract Gen Z consumers. Think of this as the start of your roadmap towards “Z-Tail.”

Focus on personalization and interactivity: Gen Z prefers experiences over things, so a great way for brands and merchants to capture their attention is finding unique ways to turn product discovery into a memorable experience. For example, young travelers arriving at their next AirBnB could be delighted to find a custom welcome kit with trial products from local companies. Bonus points if those products are sustainable, such as items made with renewable or recycled materials. Brands that make it easy for travelers to go from using that trial product to finding them – either online or in-store – will be more likely to generate interest in orders of more of those products.

Leverage uncommon media channels: Influencer sponsorships are an obvious route to reach Gen Z consumers. This is the generation that has the highest online rate of all adults in the US, and they’re constantly learning by exchanging ideas online. However, influencers are not the only option. Another innovation to consider is the “second screen experience.” Many young consumers watch streaming content on one screen while scrolling social media feeds on their phones. These second screen experiences typically center around posting comments or reading others’ thoughts while watching a show or movie. Brands could partner with app developers to help Gen Z viewers use their phones to identify the products they see in their favorite content.

Align with Gen Z values: Young shoppers conduct thorough research before making a purchase or visiting a store to ensure they can use their preferred payment method. More importantly, they want to support businesses that align with their values. Successful brands will find authentic ways to show Gen Z customers how their business supports sustainability, accessibility and more. However, brands cannot be all talk – they must be able to “walk the walk” and turn words of support into tangible action. In hospitality, that may be an Airbnb building wheelchair ramps; while in retail, it’s a merchant accepting payments from virtual accounts and personal payment apps. There are many ways brands can accomplish this, and so long as they are genuine, they will be more likely to stand out among younger consumers.

 

Bringing “Z-Tail” to Life

 

Ok, now that you’ve ditched the Magic 8 Ball and used this persona to better understand Gen Z … what’s next? You likely have an idea – or many! – about how your brand can provide the “Z-Tail” experience that will attract young shoppers. Perhaps you need a way to turn that idea into a proof of concept, or maybe you’d like a little more research and industry perspective to narrow down many possibilities into a few promising options. This is where our team at Go Studio comes into play. Contact us today for a free consultation. We’ll help you answer the tough questions about how your brand can stay top-of-mind for shoppers today and tomorrow.

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