Gen Z 15-25 year olds have specific and uncompromising requirements for authenticity, inclusivity, and environmental sustainability, and on top of all that, they demand a lot.
It follows that effective marketing to Gen Z must meet those demands, and technology is key. This group of consumers was the first generation raised on touch screens, smartphone apps, and social media; these devices and platforms contain the channels through which marketers can reach these affluent buyers: Generation Z represents a $150 billion annual sales market that continues to gain purchasing power as the generation progresses through the education system and into the world of work, according to eMarketer research.
“They really are unlike millennials, and unlike any generation before them,” said Marcie Merriman, managing director of cultural insights and consumer strategy for the Americas at EY. Merriman was one of the speakers at the recent ShopTalk conference that discussed the novel methods retailers are using to reach Generation Z.
Authenticity Key for Gen Z Marketing
“Authenticity” in the marketing context means upholding values or principles and backing them up with action, rather than pushing throwaway slogans.
Gen Z “smells” authenticity, said Craig Brommers, director of marketing for American Eagle Outfitters. “They call BS very, very fast.”
Singer Rihanna’s direct-to-consumer lingerie line, Savage X Fenty, resonates with Gen Z consumers because the brand fosters inclusivity, empowerment and confidence, values not typically associated with lingerie, said Christiane Pendarvis. , co-president and commercial head of the company.
Savage X Fenty strives to let its clients define themselves on their own terms, Pendarvis said. To support that notion, the company employs models and influencers who represent a wide range of body types. The brand, launched in May 2018, hit the $1 billion valuation threshold in February 2021 during the pandemic, when many clothing retail operations suffered major setbacks. Savage X Fenty opened five retail stores last January.
Christiane PendarvisCo-Chairman and Head Trader, Savage X Fenty
“Authenticity is what’s at stake; it’s a requirement for this generation,” Pendarvis said. “You can’t build a brand story that’s something you invented in a meeting room with the marketing department. It really has to come out of something that’s real to your brand… If your product doesn’t live up to that ethos, then That’s going to ring hollow to today’s consumer.”
The idea of authenticity can manifest itself in various ways. Peace Out Skincare founder and CEO Enrico Frezza launched the company in 2017 because his own acne made him self-conscious. He set out to build a community for those struggling with acne and hyperpigmentation. Peace Out’s “authenticity” means that the company only associates with people experiencing those issues, as opposed to models with flawless skin. It also means being transparent about your company’s product formulations.
TikTok is the primary social media channel through which Peace Out connects with Gen Z. Over the past two years, Gen Z consumers grew from one-third of the company’s users to one-half, in part due to those efforts. Posts from the company’s influential partners can get millions of views. One particularly successful TikTok post garnered 17 million views, and Peace Out sold 15,000 units of pore strips, a “pretty astronomical” number for a direct-to-consumer operation, Frezza said. Peace Out is also sold at Kohl’s and Sephora stores.
“When TikTok first launched, we were one of the first skincare brands to leverage it as a way to more organically connect with Gen Z,” Frezza said. “We felt like there was no other platform that could connect with us as organically and authentically as TikTok.”
Influencer marketing, Gen Z style
Another way for marketers to connect with Gen Z consumers is to provide them with platforms to express their own values. PepsiCo’s version of this was a 2020 Doritos campaign called Amplify Black Voices, a partnership with Black Lives Matter. The campaign began by donating outdoor advertising to black artists in their local communities. That led to Change Makers, which provided funding for local leaders to “drive the change they want to see,” said Bart LaCount, PepsiCo’s vice president of consumer insights.
“I think that helps bring a level of authenticity when we let [people] shaping the agenda of what matters most to them,” LaCount said, “but doing it in a way that’s still tied to our purpose as a brand.”
The clothing maker, also known as Brands, has tried many different combinations of social media influencers for its marketing, CEO Jill Ramsey said. It has settled on a combination of 17,000 “micro-influencers”, who have fewer followers than the biggest names on Instagram or TikTok. Each influencer receives a coupon code to track how many customers they bring to the brand. Those who are not performing are eliminated from the show, as more are constantly being recorded.
“We found that smaller influencers, with smaller followings, are actually perceived as more authentic to the customer,” said Ramsey. “They are more profitable, they do not charge [what the] celebrity influencers get paid, and you also have less reputational risk.”
Brommers echoed that sentiment. Letting young people lead their own movement is new to him; In his previous roles at Abercrombie & Fitch and Calvin Klein, the corporate office maintained a high degree of influence over brand matters. But in a leap of faith at American Eagle, the marketing department activated its 35,000 store associates, mostly Gen Z, as local influencers. They create content, organize events and get involved in causes on behalf of the company.
“With Generation Z, you have to loosen up a little bit and be a little uncomfortable,” Brommers said. “Yes, of course there is training, but the reality is that Gen Z store associates are closer to our customer than I am in my ivory tower.”