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GUEST COMMENT Gen Z shoppers and the new value exchange: increasing market share in an era of post-loyalty

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GUEST COMMENT Gen Z shoppers and the new value exchange: increasing market share in an era of post-loyalty

Callum Saunders is head of planning at Zeal Creative
Callum Saunders is head of planning at Zeal Creative

Born in the mid-‘90s onwards, Gen Z is the latest consumer cohort now coming of age as a shopper segment. Digital natives, this is an audience for whom online and omnichannel retailing is the norm, viewing the world not through ‘channels’, but as a holistic and inter-connected whole.

 

But while these shoppers bear many similar hallmarks to their millennial cousins, they display some key differences as shoppers. Still children during the recession, Gen Z has been hardened by the economic turbulence in which they’ve grown up.

 

While millennials are often viewed as idealistic (valuing comfort and convenience), Gen Z is more pragmatic, motivated by security and realistic expectations.

 

Critically, they are starting to look at value exchange in different ways. How can we engage and win with this emerging shopper superpower, especially in an era where traditional notions of ‘loyalty’ are seemingly being eroded away?

 

The post-brand-loyalty era

 

We live in a world where products and experiences are now designed to be shared, and Gen Z is the first truly native shopper audience for whom this behaviour is inherent. Whilst millennial shoppers have stronger brand loyalties, Gen Z’s propensity to use purchases as social currency means that loyalties are less formed.

 

In our research ‘Gen Z: Buying Into Better’, Zeal Creative found that 58% of Gen Z shoppers are happy to switch between brands based on what’s new and interesting. To label Gen Z as ‘disloyal’ comes from the wrong angle and misses the insight behind this key data point: Gen Z are modern magpies that have been actively conditioned to seek the new.

 

They may look around for better prices, but more importantly, cooler things.

 

Increasing market share with this audience is not about driving an unswerving brand love or religious usage of one particular product. Gen Z shoppers want the freedom of curating things that are new and interesting, and brands and retailers can offer them a spectrum of innovation, newness and curated currency that will help to increase market share in a way that is fit for purpose for this new generation of shoppers.

 

Data: using a personal currency to increase market share

 

Whilst older generational counterparts continue to exhibit a nervousness around data and privacy, as digital natives, Gen Z shoppers recognise the fundamental role that data plays in their lives as both consumers and shoppers.

 

A third of Gen Z shoppers believe that personal data is currency in today’s world. They recognise the value that their data has, and rather than a cautious approach to privacy, they are demanding a new value exchange based on this inherent and more liberal attitude towards data.

 

When it comes to increasing market share, utilising data in the right way is a tactic that will hold sway with Gen Z shoppers. 61% are happy to submit personal data in return for rewards and offers. In a post-brand-loyalty era, using this currency to connect Gen Z shoppers to new and fresh products could be a critical way to help foster ‘loyalty to the new’.

 

And 42% of Gen Z shoppers would submit more data if it meant greater rewards. Perhaps increasing market share with this audience is less about continuing to drive ‘loyalty’ as a focus, but refocusing our own efforts on the new value exchange?

 

As well as serving as a ‘personal currency’ for value exchange, data also needs to be utilised to fuel curation and discovery. Outside of the world of ‘shopper’, Gen Z has grown up with data-driven algorithms in all aspects of their lives: Spotify’s ‘Discover Weekly’, Netflix recommendations, Airbnb experiences to name a few. This is a shopper audience who buys into discovery and curation – using data to serve this value will help to keep Gen Z shoppers engaged and spending.

 

Increasing market share with Gen Z shoppers

 

At its worst, generational stereotyping can be a lazy form of segmentation, grouping a diverse range of people and attitudes into a neatly-defined (yet ultimately unrepresentative) label.

 

But at a macro level, unique contextual factors are informing and shaping the cultural attitudes, outlooks and beliefs of this new generation as a whole.

 

The ever-changing retail landscape is where many of these changes are becoming visible, reflecting new shopper behaviours: what they buy, how they buy and why they buy and for Gen Z, this behaviour is ushering in a new era of value exchange.

 

Loyalties may be less formed, or less of a concern (at least on the part of the shopper) than ever before. Our role is to navigate this new value exchange and keep a growing and influential shopper audience engaged and inspired, fuelling their continued thirst for firsts.

 

Callum Saunders is head of planning at Zeal Creative

 

Main image: Fotolia

 

Author image courtesy of Callum Saunders/Zeal Creative

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