Generation Z, or ‘Gen Z’, refers to people born between 1996 and 2010. According to the 2021 census, this age group represented 18% of Australia’s total population.
Gen Z has a growing influence when it comes to buying and spending power. The Next Gen Index by Afterpay found that Gen Z represented 5% of all retail spending in 2021. This is projected to grow to 10% by 2030.
As this demographic cohort enter the workforce they will earn their own disposable income. Business owners could benefit from understanding typical Gen Z buying behaviour. These customers likely haven’t reached their peak spending years yet. So, it could be a good opportunity to build strong relationships with them now.
Gen Z customers, like any other generation, have a distinct set of collective preferences and values. These Gen Z traits could include things like social media use, or sustainable business practices.
In this article, we discuss the Gen Z characteristics that make this customer group unique. We also uncover strategies to help your businesses market to Gen Z so you can better appeal to this demographic and help boost their customer experience.
There are some common Gen Z characteristics that make this demographic group unique. These are based on market research and statistics.
Understanding some of these Gen Z traits may help you meet customers preferences more effectively. While being aware of these Gen Z trends can be useful, it’s important not to stereotype, or make assumptions about your customers.
Gen Zs are known as “digital natives”. This means they were the first generation to grow up with the internet as part of daily life. According to Mccrindle’s 'Generation Z – The future consumer' over 95% of Gen Z owns a smartphone.
Technology has transformed Gen Z consumer behaviour. Many of them learn, communicate and socialise online. They also tend to spend a lot of money online. Australia Post’s eCommerce Industry Report 2024 found that Gen Z spent over $10 billion on online shopping in 2023.
Gen Zs digital lifestyle has also changed the way they engage with businesses and brands. They tend to expect visual content, such as short form videos. They also prefer instant communication and smartphone-friendly features. This applies whether they’re searching for products or contacting customer support.
Because of their online presence, Gen Z has been called the first “global generation”. They’ve grown up with immediate access to international news and entertainment. Through social media, they create worldwide communities based on similar interests.
This global perspective can make Gen Z customers more sensitive to wider social and environmental issues. For example, Gen Zs often have concerns about climate change.
Gen Zs may choose to express their personal values when shopping. Below we delve into some interesting trends to consider.
There are many ways your business can connect with this cohort and boost customer experience. We unpack some Gen Z marketing strategies below.
Gen Zs typically expect an easy, user-friendly online shopping journey. The experience should be consistent across various platforms and touchpoints. According to the Telstra Tech State of Play report, 60% of Gen Z customers believe it’s important for a business website to be integrated with its social media presence.
This is where an omnichannel customer experience strategy may come in useful. This means offering products, service and support across your digital and in-store channels. Engaging Gen Z customers on the platforms they’re already familiar with may help improve the customer experience. In the long term, a successful omnichannel strategy can help increase customer retention and customer loyalty.
An omnichannel strategy also helps personalise the customer experience. This might include product recommendations, or customer support. This may be an appealing feature for a generation that values its identity when choosing brands to buy from.
Giving Gen Z customers the option to buy products directly through social media (social selling) may help boost your bottom line. By 2025, Gen Z are expected to represent 29% of social commerce spending, according to Statista. In general, a strong social media presence could be an advantage. The Telstra Tech State of Play Report 2024 [PDF, 797KB] found that 75% of Gen Zs are more likely to buy from a brand that’s active on social media.
Growing up in the internet age, Gen Z customers might be confident with using the latest technology. When shopping, they may prefer a completely digital journey from browsing to buying. This particular Gen Z characteristic emphasises the importance of digitising your business.
Introducing more interactive software to your customer experience may appeal to this age group. Customer service chatbots can help your business by collecting useful data and creating personalised responses. Gen Z customers may appreciate a convenient feature that is available online around the clock.
Understanding the right payment methods for your Gen Z customers could be a good way to appeal to them. Gen Z are likely to appreciate more flexibility when making purchases. The Next Gen Index by Afterpay found that Gen Zs spending on Buy Now, Pay Later (BNPL) instalments has increased 270% since January 2020.
Digital payment platforms can help offer speed, simplicity and convenience for both you and your customers.
As a global generation expressing their identity with their purchases, Gen Z customers may prefer to shop from brands sharing their values. The Telstra Tech State of Play Report 2024 [PDF, 797KB] research discovered 25% of Gen Zs feel that ethical policies are very important when deciding whether to trust a business.
Many Gen Z customers expect businesses to communicate their values with honesty and transparency. Misleading or false information may risk losing customer trust. According to the Australia Post eCommerce Industry Report 2024, 57% of businesses were discovered to be ‘greenwashing’. This is when a company makes dangerous or misleading claims related to sustainability.
When marketing to Gen Z it’s important to understand they often welcome a genuine and authentic approach. Communicate your company values clearly and to follow them with purpose. Promoting ethical practices or corporate social responsibility (CSR) programs may also appeal to this generation of shoppers. This may help you build a loyal customer base and improve your customer experience.
With a growing spending power and social impact, this group is an important customer demographic. Unique Gen Z characteristics such as their digital lifestyles and global outlook often have a large impact on how they spend their money.
To appeal to this segment, your business could consider increasing its social media and online presence. These platforms are effective in building community engagement and awareness. Communicating positive social values may help in building brand loyalty.
Developing your digital customer journey can help you connect with this audience as they’re browsing online. Convenience and accessibility are often important factors in the Gen Z customer experience.
As Gen Z shoppers have a growing influence on the future of retail, it may be a good time to start building strong relationships today.
Disclaimer: This article does not necessarily reflect the views of Telstra or its staff.
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