An individual’s purchasing decisions are
influenced by a wide range of factors. From socioeconomic background to the level
of education, these differentiating components of a consumer can have
significant effects on how an advertisement is viewed and a product is
received. One dynamic that can be particularly influential is an age group or
generation.
Shaped by the changes in the world during
their lifetime, members of different generations can have widely dissimilar,
and at times conflicting, viewpoints than those of other age groups, both older
and younger. Two such generations with different spending habits are Gen Y and
Gen Z. Despite being frequently confused with one another, these younger
generations are not interchangeable, especially within the marketing landscape.
Below is a brief comparison of these two
generations, as well as some strategies brands can use to target each group more
effectively.
Who Are Gen Y and Gen Z?
Gen Y, also referred to as millennials, were
born between 1980 and 1995. Due to the moniker of “millennial” being associated
with the year 2000, this age group is often thought to be younger than it
actually is; however, many millennials were coming of age at that time. In
fact, the oldest millennials are now in their forties with kids, mortgages, and
retirement plans.
Millennials also make up the largest living
population, with more than 65 million members in the United States. Due to their
dominance in the workforce and how many there are, members of this generation
have been creating major waves in the way America does business. They also have
incredible buying power and reportedly spend approximately $600 billion in the
U.S. each year.
Gen Z, at 68 million strong, does not have
the same spending power as their older peers but will see a significant surge
in buying ability over the coming years. Born between 1996 and 2014, “Zoomers”
are very young, with many still in school. Nonetheless, this newest generation
of shoppers is starting to come into their own and has over $140 billion in
annual spending, making them a major target for advertisers.
Both generations have had similar exposure
to rapidly advancing technology, the spread of global centrism, and other transformations
around the turn of the century. That being said, older millennials are familiar
with a time before these changes, while Gen Zers have only really known a time
of smartphones and the Internet.
Strategies to Target Gen Y vs. Gen Z
First things first, both Gen Y and Gen Z are
tech-savvy and digitally literate, with much of their worlds revolving around
the Internet. Gen Zers are especially proficient, as they have been exposed to
high-tech devices from a very young age. As a result, these groups spend a lot
of time shopping online, primarily on mobile. Marketers would be remiss to
neglect this highly prevalent area by not updating to be as mobile-friendly as
possible. This includes investing in mobile-first designs for online stores, websites, and apps.
Not only do these services need to look
good on mobile, but they need to work fast. Loading speeds rank highly with
both generations, as do accessibility and convenience in terms of the shopping
process. Known to abandon carts if the experience is lacking, these groups
require practically seamless shopping, checkout, and order tracking experiences
if they are going to view a brand in a positive light. This could involve
implementing a straightforward return policy and offering free shipping and
delivery. Small businesses may find improving operations is easier through a
dedicated e-commerce app or via third-party fulfillment services designed to
make the shipping process as efficient as possible.
While there are many similarities, there
are also differences in where and how the generations do their online shopping.
Many Gen Zers do not have a credit card of their own yet. As such, it’s
recommended to offer as many payment methods as possible, including online
wallets, to target this generation of consumers. They also have a stronger tendency
to use social media platforms with shopping features or tools. Referred to as
“social commerce,” this type of purchasing happens entirely within an app, such
as Facebook and Instagram.
Gen Z also closely follows the trends of
influencers and online content creators on TikTok and other rising social media
apps, more so than other generations. Marketers should bear in mind the
importance of video content and video platforms like these, as their use is on
the rise for both generations. It would also be prudent to consider forging strategic
partnerships with influencers, other brands, and individuals who have already captured
the targeted audience.
Lastly, brands should make it a point to be
authentic and transparent when approaching both millennials and Zoomers. Driven
by authenticity, these groups appreciate brands that work to develop
relationships with consumers and gain their trust. As such, brands should avoid the hype that seems fake or forced. Instead, boost engagement and build brand
loyalty through a humanized, omnichannel experience drawing on emotional
connections and real value. Doing so may involve seeking feedback from previous
customers, engaging on social media, and making consumer voices feel heard.
Revitalizing
Marketing Campaign Tactics
As the younger
generations continue to reshape the realm of business, brands must do what they
can to keep up and meet their demands. Going forward, it’s advised to
capitalize on the strategies that meet the needs of both whiles also trying new
things to capture attention. Such experimentation shouldn’t be shied away from
because, if there’s one thing we know about Gen Y and Gen Z, it’s that they’re
very open to change and look to brands to be leaders in transforming the world
around us.
For further information on how these two
generations differ and ways to tackle their purchasing behaviors separately,
please see the accompanying resource.
Author bio: Jay Catlin is CEO at AMS Fulfillment, a leading
order fulfillment company servicing B2B and B2C clients nationwide. Catlin has
been with the company since 2002 and helped grow AMS into the successful
third-party fulfillment entity it is today.
