Why Gen Z Consumers Are More Important Than Ever

Monday, 11 July 2022, 2:45 pm
Press Release: Hugh Grant

By 2031, Generation Z will increase their income by 5 times the current level, over $2 trillion annually. By that time, Gen Z will have overtaken Millennials as the wealthiest age group. As such, many companies find themselves gravitating towards this younger generation that continues to grow in global importance. But how will these young people change the consumer landscape?

Gen Z accounts for around 2 billion people worldwide and is on pace to be one of the highest-earning and most well-educated generations. As young people move into the professional workforce in the coming decade, their income will increase dramatically. With a new influx of disposable income, the consumers of Generation Z will have to decide where and how to spend their money. Brands looking to the future will soon try to attract the attention and business of this upcoming generation of consumers.

Currently, Gen Z’s top three favorite brands are Google, Netflix, and YouTube in that order. Gen Z is clearly a technology-focused age group that relies on social media to connect with not just each other, but businesses as well. And given that roughly half of Gen Zers get their news from social media, businesses who promote themselves online have a direct pipeline to this increasingly important target audience. As Gen Z is the most digitally savvy generation, businesses will naturally reach this audience through social media outreach.

With the increase in e-commerce, connecting technology and business is a clear route to the ever-important Generation Z. Nearly half of all teens in the United States are online more than 10 hours a day, and two out of three are interested in making a purchase through social media directly.

There is much in store for Gen Z during this next decade, and it is essential for companies to make changes to their business model to best connect with this generation of young people. The online world is the best method of connection between businesses and consumers, as social media platforms act as a two-way street of communication. Businesses can target digital advertisements to the best audience for them; with 44% of Gen Z consumers purposefully interacting with posts to influence the algorithm and reach the content they are looking for, young consumers are able to find the brands that speak to them.

But there is more to a brand than just a strong social media presence. Gen Z, more than any other age group, cares more about a company's values than the product or price tag. Ranking as one of the most important factors is environmental sustainability. In fact, 73% of Gen Z consumers said they would pay more money for a sustainably sourced product. Ethical business models are paramount to a brand’s success, as large corporations are under the watchful eye of Generation Z consumers. And with Gen Z on pace to be the best-educated generation, you can be sure that young people will strive to be informed and educated consumers.

Diversity is also important to Gen Z, as more than half of them want brands to support wider inclusivity initiatives. This makes sense, given that Gen Z is the most diverse generation, with nearly half of them being people of color and 20% identifying as LGBTQ. If brands can connect to this diverse community, they will have a far easier time creating long-lasting business relationships with these young consumers.

With young professionals picking up higher-paying jobs, Gen Z’s income level will continue to grow in the next decade. In order to tap into this market demographic, companies large and small will have to find shared values to connect with potential customers in the online world.

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