Dubai: Pick up any article on marketing or business these days, and it’s likely it will mention millennials and Gen Z.
Marketers depend on them, advertisers play to their needs, and most social analysts believe they will be the generation to influence the future of the digital economy.
The term “digital native” was coined by Marc Prensky, an education consultant, in 2001. It’s also referred to as “tech native”, to represent the fact that this generation has a natural understanding of tech products. It is one step above tech savviness, which used to be a skill only some millennials possessed. These days, the internet and social media aren’t tools that you use. They are part of the very fabric of society for the younger generation.
Being Gen Z friendly
In an increasingly connected world, businesses need to adapt to the demands of a digitally native population as they grow. Specifically in the Mena region, in a recent article it was estimated that the Gen Z population is around 1 million in the UAE, and they are extremely entrepreneurial. And in a report issued by HSBC, 63 per cent of all Mena businesses were run by people aged 35 or under.
So how do millennials and Gen Z relate with businesses, when they’re not launching their own? They favour usage over ownership — younger consumers are used to accessing digital products rather than owning them. This is apparent with the rise of the SaaS (subscription as a service) model and subscription platforms.
They research and analyse their consumption. Constant access to search engines means better informed consumers. Gen Z and millennials read reviews, share their views, and have access to more resources.
“Clean” equals better products: The movement towards authenticity is reflected in the products they buy, with a huge trend towards clean, organic and natural products. In fact, 52 per cent of all organic produce consumers in the US are millennials.
* They value personalised products: According to McKinsey, 58 per cent of Gen Z and millennials said they would pay a premium for products that highlight their individuality or embrace causes they identify with.
* They expect 24/7 access: This new breed of consumers expects more than ever to be able to consume products and services at any time and place. This means omni-channel marketing and sales must reach a new level.
* Personal recommendations go a long way: The rise of influencer marketing proves word of mouth plays a huge part in shaping consumer preferences. In fact, 65 per cent of those surveyed in the McKinsey report say that recommendations from friends are their most trusted source.
* Mobile before web: According to Google’s research, in terms of devices used, Gen Z use smartphones (78 per cent) more than laptops (69 per cent) and tablets (52 per cent).
* Company culture is more important than benefits: Millennials and Gen Z say company culture is more important than salary (29 per cent versus 15 per cent).
* Businesses should work towards ethical goals: According to Deloitte’s Millennial Survey, the generation believes the success of a business is measured in its focus on improving society above its financial results.
The influence of Gen Z, who is the first truly digitally native generation, means that businesses must understand changing consumer needs, trends and preferences. This is particularly true when it comes to communication, transparency, and ethics.
Is your business fully mobile? Do you communicate through influencer marketing? And are you offering a flexible product or service that is easy to share, personalisable and available at all times? In one word, how innovative is your offer. These days, it is not enough to launch a mass-produced item that will enter every household.
Gen Z and millennials want meaningful products that reflect who they are, not one-size-fits all. This consumer-first approach is the only one that will resonate with the new generations. And if your company can meet those needs, the fast spread of ideas, feedback and word of mouth of social media can go a long way in helping you succeed in an increasing competitive world.
— Faris Mesmar is Managing Partner at Hatch & Boost.