|Baby Boomers||Generation Z|
At a time when retailers and housewares suppliers alike are hyper-focused on marketing their products and services to Millennials, several other generations, both older and younger, have considerable buying power and deserve attention from the housewares industry.
This year’s Generational Marketing report examines the irrepressible buying power of Baby Boomers and the emerging influence of Generation Z— two developments that should not be ignored while courting Millennials.
The size of the Boomer generation and their longer life expectancies gives this group of consumers a second look. Just when you think you might have Millennials figured out, the first wave of Generation Z is coming of spending age.
Generation Z Poised To Surpass Millennials In Buying Power
NEW YORK— While marketers, manufacturers and retailers are trying to win the Millennial consumer, there’s another generation in town with $44 billion in spending power and projected to comprise 40% of all consumers by 2020, according to industry analysts, a vast demographic unwise to ignore: Generation Z.
There are some similarities between Gen Z and their siblings, parents and grandparents, but it’s their dissimilarities and nuances— who they are and what they want— that will help inform the future of their interactions with the housewares industry.
Marketing to this generation means stepping away from a one size fits all marketing prototype to focus on specifically tailored content for each individual and burgeoning segment of arguably the most diverse generation yet, according to analysts.
“What happened with the Millennials is that so many people said, ‘If you want to target the Millennials you do this, this and this.’ That was a mistake. Let’s not repeat it with Gen Z,” Gregg Witt, youth marketing strategist, trend analyst and evp at youth marketing firm Motivate, told HOMEWORLD BUSINESS®.
Generation Z is driven by its birth into the tech age, with unmatched diversity and the financial experiences of its predecessors, traits that have informed how this generation is expected to consume everything from information to housewares products.
However, while gleaning into what makes this new generation tick, it’s important not to alienate older generations who still command substantial buying power or diminish their capacity for influence.
Meet Generation Z
Meet the new digital natives. Generation Z is the first generation to be born into a world of instant access, streaming content and global communication with no memory of what it was like without it.
“Tech is no longer separate from us, it is synonymous with who we are. And that makes for a very interesting conversation about how we are consuming content differently, sharing things differently and how we are behaving and interacting with humans,” said Connor Blakley, a member of Gen Z and founder of the youth marketing firm YouthLogic.
This “unrelenting relationship with info and tech” has shaped who they are, what they want and how they shop for it, according to Witt, including their craving for experiences.
The Great Recession affected Gen Z unlike its predecessors, at a time when they were building their first memories and coming into adolescence, and helped shape their financial culture.
Those born after 1996 were in early adolescence when the great recession hit, and their first memories were that of financial turmoil and emotional upheaval.
“We were seeing our parents go through the recession, we were seeing our houses get foreclosed on, we weren’t going out to eat. It made us much more conservative with spending habits,” Blakley said.
Influenced by the hardships of previous generations, Gen Z has evolved into “agents of entrepreneurism,” according to Witt.
“The world is set up to build small businesses now, but the driver is that they saw mom and dad move out of a house and into an apartment. They saw some serious stuff go down, and they don’t want to be out there in the world and have nothing,” said Witt.
He added, “It’s a big thing that needs to be embraced. There’s a lot of big initiatives from brands going on to embrace that entrepreneurism and burn that into their company DNA.”
Joe Derochowski, executive director, industry analyst, home, for the NPD Group, added that while Gen Z is developing financially conservative viewpoints they put value above cost.
“When they hear 10% off or 20% off they view that as ‘you’re trying to sell me something. You’re not trying to establish a relationship with me.’ The impact of promotions may not be what we think,” he said.
Already at 70 million and strong, Gen Z is projected to be the most culturally and ethnically diverse group in history, according to analysts.
Coupled with their multicultural backgrounds is the fact that those born after 1996 are the first generation not to be living “in the shadow of 9/11,” according to Blakley, which helped shape a politically progressive worldview.