What Happens When Marketing Meets Gen Z?

If you think millennials are changing things, wait until the digital natives exert their will on the world. Up-and-coming digital natives, born about 1997 or later, are the first generation to grow up with a globally connected supercomputer in their hands.

Digital natives—and millennials, born roughly from 1981 through the early 2000s—refuse to play by the rules established in the generations preceding them, yet brand managers still must persuade them to buy products, use services, enjoy experiences or download apps.

One challenge is that advertising via many traditional vehicles (print, broadcasting, telephone solicitation, email) can easily be blocked or ignored (DVRs, caller ID, spam filters). Members of younger generations dislike sales pitches so much that they pay not to get pelted with ads (e.g., Pandora and Spotify), and they tend to be skeptical of information provided by companies, governments and institutions. They are much more likely to trust the opinions of friends or sincere-sounding strangers (Amazon customer reviews, Reddit and Yelp posts) than the opinion—or marketing pitch—of someone affiliated with any traditional organization.

As a result, marketers have labored to figure out how to use social media to turn customers into brand champions (strong consumer-engagement campaigns include Dove’s Real Beauty, Lay’s Do Us a Flavor and Share A Coke) and how to reach people who dislike being targeted—chief among them: digital natives and millennials. Social media, a preferred means of communication for millennials, has proved to be a valuable marketing tool only if it entices people to engage with the brand in an intelligent, meaningful or entertaining way. On Pinterest, for example, L.L. Bean has 5.3 million followers, and Nordstrom has 4.4 million, most of them interested in photos of animals and wedding ideas, respectively.

Marketers have tried to multiply those successes by transmitting immediate, targeted, personalized messaging to the screen in nearly everyone’s pocket, the smartphone. But their tactics probably won’t work with digital natives, who are jaded from witnessing computer algorithms that churn their online searches and purchases and social media activity into personalized product pitches. They will inevitably see mobile messaging as a lame attempt to sell something. And this young crowd will resist.

Wanted: New Tactics

Marketers will have to develop approaches to engage these consumers, and a few clues for what to do have  emerged.

Social media is still in its infancy, and digital natives will use breakthrough communication technologies to move it into adolescence. For instance, although Facebook and Twitter might not even exist in a decade, communication among groups of like-minded friends certainly will, as will communication among people with similar goals and interests. High school and college students already set up their own private social media platforms to avoid parents’ prying eyes. And all media consumption will eventually be on-demand, with the customer dictating the terms and perhaps helping to write the story. Of course, this means marketers will have to embrace a dramatic loss of control.

In addition, marketers’ messaging on social media, and everywhere else, will need to be transparent, and they will need to build intimate relationships with every customer. The following examples and cautions can help you develop your own means to those ends.

First off, all marketing communications—everything from signage to social media—should represent and reveal your values, because consumers buy brands that reflect their values. Chipotle diners, for example, appreciate the chain’s “Food with Integrity” initiative, which discloses all of the ingredients in each menu item, including genetically modified organisms (GMOs).

Business owners and marketers must remember that letting customers know you and your values will open your company to scrutiny and criticism.

For example, Whole Foods’ customers care about the ecological, political and social impact of the food they consume. So the company’s tech infrastructure informs customers precisely where those bell peppers were grown, who picked them, how they were shipped, and so on. The company wants to instill loyalty and trust with this initiative, but if it instead revealed that Whole Foods’ policies are hypocritical, the company would hemorrhage customers and revenue.

Although the grocery chain does the reporting for its customers, digital natives soon will have instant access to varied types of product information. They’ll know what products are trending and have real-time updates on buying opportunities; marketers will have immediate access to selling suggestions based on user profiles. (A company named Placed already collects passive data, which is the information shed automatically by cellphones, to track shoppers’ locations just as Google Maps reveals traffic snarls by smartphones massed on a road.)

Bottom line: Companies that do not want to engage with customers on the customers’ terms on a daily, hourly or minute-by-minute basis will become obsolete. Circuit City, Borders and Radio Shack have either already folded or are being displaced by companies that provide services faster and better. Nimble companies, often small ones, will have the advantage over rigid, unresponsive competitors.

How to Prepare

Giving away control. Sharing information. Inviting input and scrutiny. Aligning mission with action. Being trustworthy. Making customers feel their choices have purpose and meaning. Hyper-personalized service. Improving the world. These are the keys to marketing success for 21st-century businesses. Whole Foods and Chipotle wield many of them, and you can, too. Here are five powerful factors that nearly any business can harness for a bright future.

1. Alignment: Ensure that your organization’s mission, goals, procedures and communications are consistent and in harmony.

2. Purpose: Does your organization stand for something larger than itself? Does it serve admirable principles? In a transparent world, socially conscious companies will have an advantage. Businesses that supply locally produced food, alternative energy and fair-trade products, for example, can use their missions and values to sell themselves. Target boosts its brand by giving back 5 percent of profits to the communities where its stores are located.

3. Positioning: In the future, selling will depend less on persuasion and more on participation and interaction (Minecraft—the constantly evolving, addictive computer game—spends no money on marketing but has turned millions of digital natives into fiercely loyal brand fans who discuss issues and updates in viral social media exchanges). Successful brands will position themselves as trusted friends, perhaps by sharing tips (Lowe’s) or recipes (Campbell’s), or by giving hassle-free refunds (Nordstrom, Kohl’s, Zappos) or coupons for free products (Healthy Choice, CoverGirl) to less-than-satisfied customers. American Airlines, Southwest Airlines and Whataburger all tweet their customers as friends, using language such as “love you” or “enjoy Paris.”

4. Control: Identify areas where the company can give away control. Invite your customers to submit ideas for new designs, flavors or products, or create a committee to act on one customer-submitted idea a month. GE has latched onto this in a big way: It partnered with a company called Quirky to crowdsource product ideas from individuals who can then use the corporation’s technology to make the product viable.

5. Disruption: Expect it. Anticipate it. Embrace it. You have no other choice.

This article appears in the June 2015 issue of SUCCESS magazine.

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Owen Shapiro is president of insights and inspirations company Shapiro+Raj and co-author of Brand Shift: The Future of Brands and Marketing. He is a market researcher, strategist and speaker.

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