How to market to Gen Z as they quit social media
Young consumers are growing uneasy about their relationship with the algorithm, and many are switching off. Joel Moran, Afterpay's international vice-president of marketing, explores how brands should adapt.
Look at the marketing mix of any brand, big or small, and it’s likely that paid digital ads play a large role. But the success of targeted advertising over the past decade has created an unexpected problem, according to leading futurists.
Younger customers – caught in a never-ending hype cycle of new trends – are increasingly exhausted by ‘new’ stuff. Others are growing suspicious of algorithms designed to encourage them to spend, spend, spend. As a result, many are switching off.
For brands, who pour billions of dollars into digital advertising every year, this presents a dilemma. Gen Z and Millennials account for 36% of the total retail spend in Australia. If they’re rejecting the algorithm, how else can brands reach them?
The solution is to radically rethink the consumer-brand relationship, according to Solving The Consumer Equation, a new report prepared by global forecasting agency The Future Laboratory, in partnership with Afterpay.
To understand how to connect with Gen Z, it’s important to first understand why they’re rejecting the algorithm. For some, it’s a growing aversion to watching their identities and tastes repackaged and redistributed to them en masse.
For others, it’s a dawning awareness of the damage that algorithms create.
Joel Moran
As influential Gen Z author Freya India recently wrote, algorithms are like conveyor belts, constantly delivering content that exploits users’ worst fears and insecurities. “Your feed becomes an endless stream of content that makes you feel worse about yourself,” she wrote. “You’ll find yourself on a continuous conveyor belt of apps, products, services, pills, and procedures to fix you.”
Still others, like US journalist Kyle Chakra, fear that automated recommendations are flattening culture, making our tastes “more similar than different” and slowly warping our desires and sense of agency.
Whatever the reason, forward-thinking brands must recognise this cultural shift and find new ways to engage young consumers.
For retail designer, futurist and author Ibrahim Ibrahim, the solution is to move away from a transactional, point-of-sale model to a “point-of-connection” model.
“This means we need to work with our teams to speak like a magazine, change like a gallery, build loyalty like a club, share like an app, seed like an incubator and engage like a show,” he says in the report.
He adds that consumers want to be heard and understood, not simply exploited.
One way to do this is to treat people like ‘members’ rather than ‘customers’ and facilitate real-world connections, where consumers can interact with one another.
The Future Laboratory predicts that retailers will increasingly find ways to create new online marketplaces – or ‘social storefronts’ – where consumers are excited and incentivised to gather online.
Social demographer Mark McCrindle said forward-thinking brands will find ways to give consumers a sense of agency.
“Gen Z aren’t used to being passive customers,” he said. “Don’t design it for them and push it out. Design it with them and communicate it through them. If you empower them, and give them the opportunity they will run with it. But they need to be the catalyst of it.”
For some brands, that might mean enabling customers to customise or play a part in developing a new product, flavour or brand. For others, it could mean user-generated content.
Crucially, brands shouldn’t ignore young consumers’ growing unease around the algorithm – or assume that the strategies that have worked up until now will continue to work in the future.
“Brands need to be aware,” McCrindle says, “and be humble enough to recognise that an emerging customer holds the brand’s destiny in its hands.”
Keep up to date with the latest in media and marketing
The challenge is not to ‘reach’ Gen Z, they have no money. Marketers should be talking to Gen X, who, in a few short years, will be the beneficiaries of the most significant wealth transfer in history
User ID not verified.
Leave Gen Z alone. They don’t want your “stuff”.
User ID not verified.
Gen Z is irrelevant for atleast another decade they have no spending power.
Smart companies should focus their future on Gen X as they will have the largest amount of money due to the impending generational wealth transfer.
User ID not verified.