Brands and marketers are sizing up the Millennials.
Generally viewed as the young adults born from 1980 to 2000, Millennials are reshaping corporate strategies with their unique spending power and consumption behavior. They make up one of the largest demographic groups in the US (80+ million) and are expected to spend $1.4 trillion annually by the year 2020.
It’s no surprise that marketers have coveted this generation’s attention – re-engineering their tactics, tools, and tech in order to target Millennials more effectively and take advantage of current demographic trends. (Emoji campaign or Vine blitz, anyone?)
“Millennials spend more time watching TV shows on demand or streaming them on services like Netflix and Amazon,” writes the New York Times’ Sydney Ember. “They tend to have short attention spans and bounce rapidly among smartphones, tablets, and desktop computers. Many have little tolerance for traditional advertising.”
Meet the Centennials
Technology is the first thing that springs to mind when one hears the word “Millennial.” But there’s an emerging group of young people who’ll likely end up being more savvy and judicious with the use of technology than Millennials.
The generation of young people born from 1996 to 2010 or, more vaguely, in the turn of the century, is being considered the next big thing for brands, marketers, and trend forecasters – similar to how Generation X became the darlings shortly after the reign of Baby Boomers.
Meet Generation Z, otherwise known as the Centennials.
Who are the Centennials?
You can say that Centennials are the first true digital natives. “(They’re) the first generation to be raised in the era of smartphones,” writes culture and fashion reporter Alex Williams. “Many do not remember a time before social media.”
According to Forbes, more than 25 percent of the US population in 2015 belong to Generation Z, making Centennials a larger group than Baby Boomers or Millennials. This is expected to rise to 40 percent by the year 2020.
Meanwhile, a report by AdAge and Sparks & Honey suggested that Generation Z earns a total of $44 billion in allowance each year. For a generation whose oldest members are just about to graduate from college, that’s impressive purchasing power.
Here are some ways you can spot a Centennial:
- CBS described members of Generation Z as tending to gravitate toward newer social media platforms like Secret, Whisper, Wishbone, Vine, Periscope, and SnapChat. Facebook? Not so much. In fact, a study found that Centennials visit Facebook (52 percent) less often than do Millennials (77 percent).
- Sparks & Honey also found that the average Centennial spends more than 3 hours a day in front of a screen. Gen Z-ers, in fact, spend 41 percent of their time outside of school with some kind of computer, compared to only 22 percent a decade ago.
- Members of Generation Z have an even shorter attention span – 8 seconds – which is down from 12 seconds about 15 years ago.
- As Wi-Fi-enabled digital natives, Centennials look up to icons outside of traditional media: Vlogger and YouTube personality Lucas Cruikshank, Swedish comedian and YouTuber PewDiePie, singer-songwriter Bea Miller, teenage Indonesian blogger Evita Nuh, and even Korean K-pop stars are a few examples.
- Centennials love to shop online, preferring to do so than shopping in physical stores. Brands like Shop Jeen, Brandy Melville, AwesomenessTV, and Rent the Runway successfully cater to Generation Z shoppers and offer a valuable glimpse into their minds.
- According to Sparks & Honey, this is the most tolerant generation ever, unconstrained by traditional social, ethnic, and gender roles. Alcohol and drug use are also less of a thing for this generation. According to the Centers for Disease Control and Prevention, only 66 percent of high school students now have had one alcoholic drink in their lives – down from 82 percent in 1991.
Connecting with Centennials
The characteristics above paint a picture of a generation that, as market researchers would say, is less idealistic and more pragmatic than the one before it. This presents a unique challenge to companies hoping to engage with and market to Centennials with the goal of driving revenue and loyalty.
New studies have emerged presenting statistics and insights on how companies might be able to respond to this challenge. Research by PowerReviews – entitled “Centennial Shopper Study”, which takes into account the survey responses of more than 1,700 Centennials and Millennials in the US – details how members of Generation Z go about shopping for products and services.
Centennials research carefully before spending
- Having grown up in the worst recession ever, members of the post-millennial generation are often described as resourceful and practical, and this shows in the way they shop. Nearly 3 in 4 Centennials take time with their purchases – researching price, reading online reviews, and comparing different brands.
- Most research is done online, with 94 percent of Generation Z preferring to research, browse, and compare products online than in store.
- 52 percent favor the laptop or desktop computer for browsing and researching products, 37 percent prefer the mobile phone, and 5 percent use the tablet. Only 6 percent of Centennials actually do their research in store.
- Visual content is also extremely important to this generation, with 40 percent unlikely to purchase a product that doesn’t have photos of people using it.
Centennials are independent
- PowerReviews’ study also suggests that Centennials strive to be independent, with 46 percent more likely to save up for a big purchase (so that they can buy it themselves) than to be treated by their parents.
- Approximately 75 percent of Centennials say that they prefer to save their money for the future rather than spending it immediately on products and services that they want.
Centennials value quality over price – and want questions answered ASAP
- Approximately 70 percent of Centennials say that the quality of a product or service is more important to them than price. Moreover, 57 percent are likely to spend more money on a well-known brand than on a low-priced product or service from an unfamiliar brand.
- As digital natives, Generation Z shoppers want their questions answered ASAP and are impatient when it comes to receiving information. Over 33 percent wouldn’t purchase a product if they couldn’t ask a question about it on the product page; 79 percent would go on to purchase from another company or head to Amazon.
Centennials love online reviews
- Online reviews are an integral part of the shopping experience for members of Generation Z. In fact, according to PowerReviews, 95 percent of Centennials read online reviews while shopping, and close to 50 percent will not purchase a product or service if there aren’t enough online reviews.
- Close to 66 percent read at least 4 online reviews before making a purchase.
- For Centennials, the presence of reviews is considered more important than a recognizable brand name or free shipping.
- 52 percent of Centennial shoppers look for online reviews on third-party sites like Yelp, TripAdvisor, Facebook, or Google, but 33 percent prefer to see reviews directly on a brand’s website. Furthermore, twice as many Centennials trust reviews on a brand’s website (43 percent) than reviews posted by friends on social media (21 percent).
- Approximately 50 percent say they don’t trust a product or service if it doesn’t have negative online reviews. 60 percent of Centennials, in fact, read negative reviews first – a sign that they’re looking to validate their decisions by reading honest feedback left by other customers.
These numbers show that members of the post-millennial generation are more cautious shoppers and that they won’t be won over by traditional advertising tactics or marketing campaigns.
You have to engage.
As Matt Moog, CEO of PowerReviews, said, “If you fail to engage with this generation, they have the independence and control to conduct their entire shopper journey without you.”