In 30 seconds:
- Understanding why Generation Z buys what they do will future-proof your brand and drive those profits skyward.
- Gen Z believes brands should embody their values – but they also want great value in other respects.
- There is a particular phenomenon that Gen Z are obsessed with. So let’s get into why, indeed, #TikTokMadeMeBuyIt?
What motivates Gen Z to buy? Each generation has its own shopping habits, consumer trends and interests. For years, brands have searched for what makes millennials, Gen Xers and boomers reach for their wallets, but what about the new and potentially most powerful generation yet?
Gen Z is quickly becoming famous for its immunity to so-called ‘traditional’ marketing tactics. So what makes them tick, and how can you build your strategy around it?
Generations tend to have specific spending behaviours due to their experiences and environment. Understanding where these stem from and why Gen Z feels motivated to buy the items they do will put you ahead of the curve and make your marketing campaigns land every time.
So let’s get into it (we’ve got a lot to talk about).
Gen Z consumers are powerful
Generation Z is a force to be reckoned with. Yes, they’ve grown up in some turbulent times, but they are the most financially influential generation yet.
Whilst younger Gen Zs are admittedly still reliant on the bank of mum and dad, they have a considerable direct influence on their parents’ spending. A whopping 70% of parents say they regularly sound out the opinion of their Gen Z kids before making a purchase, and this is translating into an influence of over $333 billion in household spending per year. This means that Gen Z consumer trends expand beyond their age group, extending to older generations.
Meanwhile, the Zillenials, (i.e, the elder Gen Zs, the most senior of whom are currently 25 years old), are already economically fit and active, embarking on their careers, climbing the corporate ladder, and even starting families.
Having been held back by the pandemic, they are keen to make up for lost time and are showing clear signs of being even more ambitious than their millennial predecessors.
Indeed, when it comes to big goals like home ownership, Gen Z is twice as likely than previous generations to have bought their first home before the age of 25, and 85% of them want to have purchased a home in the next 10 years.
This ambition and tenacity didn’t come from nowhere. Gen Z lived through extraordinary global events at a young age, so are risk-averse. They are a truly digital generation, having been born into an internet-ready world, and online experiences serve as significant factors for motivating behaviours (more on this later).
How do you get in front of such a shrewd generation? By understanding them – and then showing how you’re right for them. So let’s get into the top 5 components affecting Gen Z consumer behaviour and how to use them to generate sales.
What makes Gen Z buy a product?
1. Saving the planet, but saving cash too
Ethics are vital for Gen Z (we dive into this below), but cash is still king for Generation Z. According to a Business Insider survey, most Gen Zers cite price as their primary motivator when considering a purchase.
Having grown up in a recession and/or come of age in the financial firefight of the pandemic – with a cost of living crisis to now condend with, Gen Z has watched Millenial and Gen X struggle, and don’t want to repeat it. A desire for financial stability underscores many Gen Z spending habits and makes them shop around like no generation before.
“They don’t want to pay full price for anything”, Jason Dorsey, a leading Gen Z consultant, told Business Insider. This manifests in two ways: Gen Z generally opts for the cheapest product option as opposed to the big brand name, but they can be persuaded into investing in high-end products that last a lot longer or are more effective than cheaper competitors.
Quality over quantity is the order of the day for Gen Z, and their refusal to be ripped off is changing the face of the commercial world.
80% of Gen Z wait for an item to go on sale before they buy it. That’s big news for ecommerce. Over half of consumers prefer coupons and discounts on their mobile devices, and given 79% of 13-20-year-olds say they can’t live without their smartphones, marketing sales and discounts and linking to mobile-optimised ecommerce is vital.
For more luxury brands, motivating Gen Z to purchase hooks on informed purchasing decisions. To read about reaching younger generations via this kind of marketing, check out our article on luxury marketing for Gen Z.
2. A holistic view of ‘good value’
Gen Z is determined to shape the planet’s future for the better. A responsible brand that shares and acts on its values, champions social causes and prioritises community building are popular amongst Gen Z. 51% of Gen Z (aged 18 to 23 years) will ensure that a brand’s corporate social responsibility lines up with their own before they make a purchase.
A key value to embody is diversity. Gen Zers are the most diverse demographic yet, and 60% are more likely to buy from brands representing diverse identities in ads, while 76% believe that brands must address diversity and inclusion.
Another key value is sustainability. This generation has grown up in the sweltering heat of the climate change conversation, and 62% of Gen Z prefer to buy from sustainable brands. This generation is willing to pay more for ethically made products – a significant finding given Gen Z’s love of economy.
However, simply marketing around values isn’t enough: brands must embody them through their activities.
Transparency and truth drive Gen Z engagement. Having existed on a digital diet since birth, they’re the generation most fine-tuned to sniff out insincerity, and with 82% of Gen Zers researching a brand before making a purchase, they’ll know if you mask the truth.
78% of Gen Z respondents believe that brands are all talk and no action. Lip service won’t cut the mustard. Embedding genuine ethical behaviours in your brand is an incredibly effective way to pique Gen Z’s interest, boost sales and will encourage a loyal following.
3. Influence is in
Whilst not the ultimate reason Generation Z spend, social media directly influences Gen Zers’ spending habits – in particular, influencer marketing.
The online world is usually where Zoomers tend to get their inspiration fix for what to spend on. In fact, 97% of Gen Z say they use social media as their number one source of shopping inspiration.
For Gen Z, your social media is the home of brand persona and identity, and it can also be a crucial shop front. 72% of Gen Zers have said they would more readily purchase from a brand they follow on social media.
As social media strategy progresses, interaction will become more important. Members of Gen Z want to commune with brands on an equal footing. 41% of Gen Zers said when brands post social content that makes them feel like part of their community, they feel more connected to them. It’s this feeling that makes them come back again and again.
Of course, authenticity is key to this kind of communication. 82% of Gen Z trust brands that use real people in their advertising more, and this generation are known to seek out user-generated product reviews. 82% of Gen Z also say that peer reviews are central to their buying decisions. So how can brands tap this behaviour? We have one word for you: influencers.
Nearly two-thirds of Gen Zers follow influencers and 50% trust their recommendations more than celebrities. As apps like TikTok continue to democratise influence, there are more types of creators who wield different kinds of marketing power – meaning their recommendations can feel more like hallowed word-of-mouth marketing, which is known to inspire 90% of people to trust more in a product.
Social media influencer marketing has a significant influence on Gen Z’s spending habits. Zoomers want brands to use relatable creators more than celebrities because it feels sincere and applicable to them. And that is what makes them want to buy. If you want Gen Z to make that purchase, a modern influencer strategy is the way forward.
Make sure you work with influencers who genuinely resonate with your brand. We also recommend taking a video-first approach: Video is the most influential format across social media platforms, and Gen Z favours short-form videos over static images.
4. #TikTokMadeMeBuyIt
Speaking of social media influencers and video content… it’s time to mention the app-shaped elephant in the room: TikTok.
TikTok is extraordinarily powerful in its ability to generate trends amongst Gen Z – including motivating this group to purchase trending products. In fact, half of Gen Z shoppers have purchased after seeing a product on TikTok.
The phenomenon of #TikTokMadeMeBuyIt is driving sales of both obscure and mainstream products like never before. The gap between content creators and consumers is more obscured on TikTok, as 83% of its users post their own content and the algorithm turn posts viral regardless of follower size. This means Gen Z TikTokers will see “real people” posting about their experiences with real products – and they’ll often feel connected enough to try the item out for themselves.
What is the #TikTokMadeMeBuyIt trend? This is where both brands and people post demonstration videos of products. The hashtag has 20.5 billion views on the app – and counting. As digital natives with a famously self-deprecating sense of humour, it’s Gen Z’s self-aware nod to how they’ve been convinced to part with their cash by social media marketing – and through creating their own video, they’re keeping the trend going to influence someone else.
Many of these videos have gone viral, causing a snowball effect. Beauty brand Paula’s choice tapped this trend by showing their products in a simple, tactile and visual way using this hashtag to draw people in.
@paulaschoice Raise your hand if have oily skin ✋ #PaulasChoice #OilySkin #Moisturizer #SkincareTikTok #GelMoisturizer #SummerSkincare #Beauty #fyp #TikTokMadeMeBuyIt ♬ gimme gimme gimme - ᥫ᭡
The tactic worked, with Paula’s Choice accruing over 61.5K views on this video alone. Check out our work with Paula’s choice and how we drove $1 million in earned media value through our case study here.
So how does this trend influence Gen Z consumer behaviour? The principle reasons are credibility and humour. Reviews are read as genuine, while the trend itself pokes fun at Gen Z’s love of getting involved in social media movements just for the fun of it.
Gen Z is not just interested in buying a product to own it – they’re also motivated to buy items to create social media content around it. Zoomers go above and beyond to get in on these kinds of trends. A great example of this is The Binley Mega Chippy sensation, where an unassuming eatery in the Midlands went viral on TikTok, drawing in thousands of visitors who were drawn to the ‘Chippy’ to make their own content around the song it played. Binley Mega Chippy now reports that their turnover has increased by 40%, all thanks to TikTok.
The most remarkable aspect of this is the transferral from online to reality. Zoomers were taking a trend from TikTok and travelling to a physical location to support a business, because they wanted to be part of the moment.
Gen Z isn’t just looking to experience products through socials; they are interested in getting them to work in tandem with real life. This shows Gen Zers will even make the trip to buy your product or service, but only if you demonstrate its value on TikTok first. So jump on this trend and show them what you’ve got.
5. Identity, expression and the novelty of IRL
Gen Z is self-aware. They care about their identity and self-expression, which informs so many of their actions – including purchase decisions. This new generation believes their experiences shape their identity the most. Speaking to these not only unlocks Gen Zers’ purchasing power, but can inspire long-term brand loyalty.
Social isolation has been a weight through Gen Z’s adolescence. This generation yearns for a feeling of belonging and community. This has made the connection between identity and community even more important for Gen Z: if a Gen Zer can see, for example, a possible fitness community or gaming cult emerging from a brand, they will be far more likely to invest.
Identity goes beyond key principles like values and community for Gen Z: as users of apps like TikTok that adapt swiftly and acutely to their interests, this generation is becoming accustomed to seeing their varying interests – from crochet to train spotting – reflected back at them. They feel a sense of identity through noting their connection to many different groups – in a combination that’s entirely unique to them.
This affects how they see brand-consumer interactions, too: 44% of Gen Z are happy to exchange their information for more personalised experiences.
73% of Gen Z believe they need more self-expression to live a happy, healthy life. Presenting experiences that give them the chance to be themselves online and in real life will unlock their buying power.
That’s the last part of the puzzle: real life. Despite their predilection for online shopping, 98% of young people make purchases in brick-and-mortar stores. Gen Z is known to flock to pop-up stores and brands that tie an exclusive, in-person experience to their product. Having a knowledgeable shop assistant to speak to – in a physical store – can be a huge pull.
How can you let your Gen Z customers know that you offer these services and experiences? Social media, of course! From M&S Romford’s popular staff TikTok account to Bicester Village’s experience marketing, social media can be brands’ ticket to creating personal connections and generating hype around physical events.
Allowing Gen Z to be who they want to be, and connecting real life with online expression (an omnichannel marketing strategy that feeds its own cycle), will get your brand in their good books. And then they’ll click that buy button.
What does this mean for marketers?
Gen Z is thrifty, informed and socially conscious customers. They spend their time and money online, but also seek out real world and unfiltered experiences that can help them express themselves – online and IRL.
Gen Z is not afraid to give honest reviews and rely on digital word-of-mouth when purchasing. They head to social media to hear about the latest products, and they’re motivated to buy into trends, often for the sake of joining in and having fun. That said, the times they’ve grown up in have informed their relationship to spending and self-care, and tend to take a more practical, considered approach to spending than generations before them.
Gen Z shoppers are different, yes, but there’s no need for a panicked rethink of your entire marketing strategy. Consider it as more of an upgrade for the new digital landscape.
How can you start? We’ve got your back. We’ve helped countless brands get it right for the generation of the future. Get in touch to find out how we can help you reach and convert Gen Z. Where this generation’s consumer trends go, the rest of the population will follow.
If you want more insights to get your strategy on-point, check out some of our links below.
