The future of e-commerce: Generation Z

generation_z_technology_devices

The next up and coming wave of consumers are called generation Z. Born between the mid 1990s and 2010, these young people have been brought up with the internet and social networks. They are ‘Digital Natives’ and as a marketer or product owner you will need to approach this generation of consumer very differently. So, let’s learn more about them…

Who are Generation Z?

Right now they are aged between 4 and 19 years old.
They currently make up more than a quarter of the US population and this is still growing.
They spend nearly every waking hour online. 46% are connected 10+ hours per day!
They influence household purchases. You can’t just advertise to parents – Gen Z are major influencers of their parents decision making.
Tech savvy and heavy users of mobile. They’ve grown up in a digital world.
Always connected, especially to social networking channels.
High online spenders.

Prefer to shop online

Gen Z have been brought up with the internet and they prefer to buy just about everything online as opposed to offline. 20% of girls aged 12 and under regularly visit online shopping sites. The ability to easily make purchases online and delivering the right product information at the right time will be key.

Despite having very low incomes (think pocket money) Gen Z spend much more of their share of income online compared to previous generations. When this germination grows older and their income increases, they will drive major e-commerce growth.

Born to share

Gen Z have the ability to impact your brand via social like no generation before. They’ve been born and raised in a world of social websites. If they don’t like your website or product, they won’t call you, they’ll put it online so their connected web of contacts can see. They’re more likely to communicate with brands via social media and will be more demanding, they’ll tell you exactly how they feel. 77% will vent frustration of poor service over social media and expect an immediate response and resolution.

Listening and fast response will be key to managing this generation online. And to encourage this generation of sharers to share your content, you’ll need to ensure the content you create will be something Gen Z will enjoy – a fun brand voice, engaging content and incentives for sharing.

Traditional advertising won’t be as effective

A Forbes study claims that 57% of Zs saying they would rather save money than spend it immediately: “After seeing their parents lose jobs and their older siblings move back home, this generation will avoid debt. They’ll find the best deals and will expect to test out products physically or virtually before they buy.”

Gen Z will research everything themselves, turning to online reviews, bloggers and product experts to learn about products. Do you have a brand advocacy strategy? You will need to. By harnessing people who love your brand, and encouraging or incentivizing them to share their opinions online, you’ll provide a source of authentic information that Gen Z is likelier to trust.

Multi-screening and multi-tasking are the norm

They multi-task across at least 5 screens daily. “They suffer from FOMO (fear of missing out) more than millenials, so being culturally connected is critical” researchers from Sparks and Honey wrote.

Mobile internet preferred

According to a survey by Ericsson, 58% of Gen Z prefer surfing the web on their mobile as opposed to watching TV.

High tech – Even the youngest age group (9-11 years) shows advanced technology adoption and mobile internet usage similar to their older brothers and sisters. 31% of US children aged 6-12 wanted an iPad over any other electronic device for christmas in 2010 (followed by a computer 29%, and iPod touch 29%) – gone are the days of wanting lego!

Respond more greatly to visual stimuli

A Wikia study shows that 54% visit YouTube multiple times a day. Visual sharing sites like Instagram and Snapchat are also huge avenues of communication for teens.

Marketers will need to start communicating visually to a diverse audience, across multiple screens.

Prefer simple, short, interactive content

Gen Z have the lowest attention span and they prefer media that is simple to use and interactive as opposed to passive TV. Getting and keeping their attention will be challenging though as they like to communicate in bite sizes. Easy to use and simpler platforms appeal to this generation.

Addicted to social networking

Many children now feel that social networking is more important than other aspects of their life, including their family. According to a study by the University of Maryland, 79% of children showed symptoms of distress when they were kept away from social networking devices.

Goodbye Facebook, hello Instagram

Every year, the amount of Gen Z leaving Facebook grows. 25% of 13-17 year olds left Facebook in 2014. They prefer visual platforms; the numbers joining Instagram grew from just 12% in 2012 to 23% in 2013. They also prefer incognito media platforms such as Snapchat, Secret and Whisper.

They want to change the world

60% of Gen Z want to have an impact on the world (compare this to 39% of Gen Y). 1 in 4 of those aged 16 or over currently volunteer. Globally, teens and their families, are changing their purchasing behaviour towards choosing environmentally responsible products and companies.

Not brand loyal

The products themselves and their quality are more important to Generation Z than brand names. Expect these consumers to switch to competitors much more quickly.

Obese

By 2027 most of the grown up Gen Zers will be obese (77.9% of males and 61.8% of females). 66% of kids aged 6-11 say online gaming is their main source of entertainment, so obesity comes as little surprise.

generation_z_interests

Some of the above slides are courtesy of Sparks and Honey. If you would like to read more about Generation Z we would recommend reading their full report: Sparks and Honey on Slideshare.

How customers REALLY shop using Smartphones

Mobile on the goGoing mobile has become a business imperative.

New research has unveiled the way customers really use devices and highlights the importance Smartphones play in researching and purchasing may have previously been underrated.

The research shows that context and the user’s aims play a major role in the choice of device. Convenience is also an important factor. Understandably, the Smartphone is the device users reach for time and time again, even if the experience is better on a PC or tablet – their mobile is always within reach.

 

Many times we turn to the screen that is closest

 

Context drives device choice

 

Smartphones have by far the highest usage for daily interactions with digital media. However, the interaction doesn’t end there. People now use different devices either at the same time or sequentially in what we call ‘multi-screening’.

 

There are two modes of multi screening

 

So how does this effect online shopping behaviour? It is not as straight forward as a simple path from browse to purchase. Consumers flick between devices, using them for different purposes, depending on the context they’re in as well as the time they have available.

We often move from one screen to another when shopping

 

Most consumers (by a large majority) actually begin their shopping experience on their smartphone. They then continue the same shopping experience on their PC/laptop.

 

Consumers take a multi-device path to purchase

 

Why would so many users not continue to purchase your product on their phone?

– Context. If they’re on the bus or on-the-go it may just be inconvenient.

– Time. When people are bored and want to kill some time they’ll start browsing using their phone. This ‘pecking’ behaviour is often done in short bursts.

– Content. Most mobile sites are slimmed down versions of the PC version. Users know this and may postpone their purchase until they can get to a PC to read more about the product and see larger images, read reviews, etc.

– Ease of purchasing. Many sites still have overly long and complex checkout processes, requiring registration and card payment details. These forms are easier and faster to complete on a PC with less frustrating input errors.

– Trust. Some people are still wary of purchasing through a mobile device.


Smartphones are the most frequent companion devices during simultaneous usage

 

The user’s purpose has a large part to play in which device they use. Think about your business. Does it drive users to interact with your website via a particular device? Looking at the following slide we can see that for activities such as searching for information and browsing the web, users prefer to reach for their Smartphone. However, if they are planning a holiday they are less likely to use their phone. If you think about, planning a holiday takes a fair amount of time and research. It is a more complex use case that involves looking at multiple sites, information search, reading reviews, sharing details with friends and looking at large images.

 

Smartphones are the most common starting place for online activities

In summary, smartphones are the backbone of our daily media interactions. They have the highest number of user interactions per day and serve as the most common starting point for activities across multiple screens.

Businesses need to consider:

– Adjusting conversion goals to account for the differences in end user goals when using each device.

– Tailoring the user experience to each device to account for the differences in how users shop.

Going mobile has become a business imperative.

Read the original research by Google