EMBRACING GEN Z

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While the oldest Gen Z member may only be about twenty-five, this young group is wise beyond their years and a force to be reckoned with. They are determined not to repeat the mistakes of older generations, even in the face of Covid. This is a unique group, and for brands and retailers to win with Gen Z, you must be:

  • Authentic/Transparent
  • Inclusive of all
  • Mobile-focused
  • Sustainable
  • Convenient
  • Powered by purpose 

Who is Gen Z?

While Millennials were raised by protective parents who believed there should be a trophy for everyone, Gen Z was raised by Gen X parents who taught their kids to figure it out. Gen Z was born between 1995-2012 and is 74 million strong in the US. While some question their loyalty, it’s likely because this group is more skeptical than others. This generation was headed on the right track, and then the pandemic hit. Unfortunately, Covid may have a long-term impact to their earnings potential given major setbacks in the job market.

How has Covid changed them?

  • While Gen Z has had access to tech since birth, they would tell you that going to school virtually has its downside. Like many, they are missing the interaction with their friends and teachers.
  • Because of online schooling, several Z’s are opting for a “gap year” during college.  If they can’t have the experience of living on campus, many have chosen to take a year off from school, thus graduating later.
  • More than 70% of those seeking mental health care during the pandemic are under the age of 24. This may be a result of becoming an adult during a period when the future looks uncertain.
  • According to Pew Research, about 26 million Z’s have found themselves back living with their parents – not by choice, but by necessity. At work, being “low man on the totem pole” sometimes means the first to be laid off. Also, many Z’s had jobs in the hospitality and retail sectors, which were the first to take a hit during the early months of the pandemic.
  • On the positive side, being stuck at home meant having time to develop new hobbies such as learning to play an instrument or trading in the stock market.

How do they choose their favorite brands?

  • Typically skeptical of brands, Gen Z votes with their wallet. They buy from local, Black, & minority-owned businesses – more so than other generations.
  • According to Morning Consult, 72% of Gen Z somewhat agree/strongly agree  that corporations have a responsibility to play a role in addressing racial inequality in the US.
  • Netflix, Google, YouTube, Amazon.com, and Amazon Prime are the top 5 most-loved brands for Gen Z according to Morning Consult’s research. Gen Z is more interested in how fun and entertaining a brand is vs. how long a brand has been around.
  • In YPulse’s August 2020 research, Gen Z reported their top favorite retailers for clothing are Walmart, Nike, Ross, American Eagle, with H&M and Amazon being tied for fifth place. Not only did Walmart win with their comfortable, yet very affordable clothing, those clothing purchases were convenient because people were in the retailer buying other essentials.

How can brands & retailers win?

  • Authentic/Transparent
    • Influencers are chosen over celebrities due to influencers’ more intimate social presence.
    • Southwest Airlines is an example of a brand that prides itself on transparency, or “Transfarency” as it says.  This airline’s campaign focuses on no hidden fees or extra costs.
  • Inclusive of all 
    • Gen Z grew up with a black President, and now we have the first female VP.  They grew up in an inclusive culture.
    • No surprise that we saw this generation rise up over Black Lives Matter.
  • Mobile-only
    • Gen Z are the first true digital natives, having unlimited information at their fingertips.
    • A brand has 6-8 seconds to catch their attention, so bite-size info is best.
    • Memes and emojis are worth a thousand words.
    • It used to be a driver’s license gave a teen “freedom” to go see their friends. Now “freedom” comes in the form of interacting with friends without leaving the house.
  • Sustainable
    • Environmental issues play into their purchasing decision. Those brands not  focusing on sustainability are feeling the effects of Gen Z’s purchasing power. Forever 21, a “fast fashion” retailer which has historically used cheaper materials, is hoping to turn things around and be more appealing to this group with better quality items.
    • Interestingly, Z’s are willing to pay for sustainability. “Buy less, make it last.”
  • Convenient
    • Quality, convenience, and service will keep this generation loyal to your brand.
    • Sharing product information and simple delivery methods are important to this group. No surprise, Amazon is a big brand for this group.
    • According to LaserShip’s post-pandemic survey on How Retailers Can Stay Ahead of Consumer Expectations, Gen Z ranks free return shipping, free standard shipping, and the ability to track orders in real time as their top needs from retailers.
  • Powered by purpose
    • Gen Z supports those brands that give back and have committed to improving the community. Toms Shoes and Bombas live this well by donating a free pair of shoes or socks for every shoe/sock purchased.

Where to reach Gen Z?

Right message, right place, right time are still key for brands looking to capture Gen Z.  According to Google’s Cool Book, the top steaming platforms for this group are YouTube, Netflix, Spotify, and Hulu. Also, while Z’s enjoy social media, to them social media is for consuming and connecting, not sharing. And be sure to check the messaging in your ad. Don’t make the mistake of running a generic-type message to this group.

Morning Consult reports that 85% of Gen Z say their future is determined by choices they make or things they can control. I am not giving up on Gen Z. I love what they stand for and I am confident things will turn around for them post-pandemic. Any brand who is not watching, listening, and connecting with them now, may find its own lifespan short-lived.

Resources:

https://www.abc10.com/article/news/health/coronavirus/young-and-alone/85-877922ea-ecb8-4326-b35a-4c90d45d5422

https://www.pewresearch.org/fact-tank/2020/09/04/a-majority-of-young-adults-in-the-u-s-live-with-their-parents-for-the-first-time-since-the-great-depression/

https://go.morningconsult.com/rs/850-TAA-511/images/200825_MLB-2020_GenZ-Report.pdf

https://morningconsult.com/form/gen-z-worldview-tracker/

https://www.ypulse.com/article/2020/09/15/gen-z-and-millennials-15-favorite-places-to-shop-for-clothing-now/

https://www.oberlo.com/blog/marketing-strategies-generation-z

https://www.forbes.com/sites/deeppatel/2017/11/27/5-d%E2%80%8Bifferences-%E2%80%8Bbetween-%E2%80%8Bmarketing-%E2%80%8Bto%E2%80%8B-m%E2%80%8Billennials-v%E2%80%8Bs%E2%80%8B-%E2%80%8Bgen-z/?sh=1f6b18b72c9f

https://sigearth.com/gen-z-makes-sustainability-important-for-all-businesses/

https://ww1.prweb.com/prfiles/2020/09/29/17432194/LS_2020_info.pdf

https://storage.googleapis.com/think/docs/its-lit.pdf

 

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HOLD THE PHONE!

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Restaurant owners estimate they are losing between 20-50% in revenue due to missed opportunities with phone orders. Combine that with competitive labor markets, increased customer demand and the pandemic, and you have the “perfect storm” for brands to adopt advanced digital technology, including power assistants, to handle phone orders.

Cashiers in the Cloud

Brands including Dunkin’ and Denny’s have recently deployed bot and voice-enabled ordering with success. But what about brands like Papa John’s and Chipotle Mexican Grill who specialize and pride themselves in customized ordering for each customer? A more advanced version of bot and voice-enabled ordering has arrived just in time. The technology is called AI-powered voice assistants, AKA “cashiers in the cloud,” that can process orders quickly and efficiently without human customer service.

 

Artificial Intelligence Learns Customer habits

Here is how it works. You call a local Chipotle and you are greeted by a female voice. She responds to the customer beyond standard bot programming. She actively listens to the customer placing an order and will then make suggestions when she thinks the customer may have omitted a topping for a burrito or bowl. Example: “Would you like to add guacamole or salsa?” With each order, she learns the idiosyncrasies of how people place their order, creating algorithms that will be stored and used over and over. This ultimately increases order accuracy. Even more impressive in Q4, amid the pandemic Chipotle digital sales tripled with a 177.2% growth in their digital sales. 1

AI-powered voice assistants capture information from customers so when they call back, the technology can identify a guest by their phone number. This allows the bot to suggest items each customer has ordered in the past.

 

Increase Customer Satisfaction and Efficiency

Customers love the convenience. They can order, pay, and skip the line by grabbing their food from the pick-up shelf. AI-powered voice assistance also reduces the amount of time both manager and employees must spend on the phone, enabling them to focus on other aspects of the total experience.

Chipotle’s CEO and chairman, Brian Niccol said, “Expanding access and convenience through our digital ecosystem has kept the Chipotle brand relevant.” He added, “With this success, we will not allow complacency to set in, rather, we will continue to look for ways to further enhance our digital ecosystem.”2

 

Papa John’s combines AI and Human Interaction

Similarly, Papa John’s announced in November 2020 that they will also be adopting an AI phone system.[1] The new platform will be integrated into the restaurants’ pre-installed systems to manage phone orders that come through their call center. This platform combines AI with human operators to ensure they don’t miss an order. The system is designed to allow human intervention in case the AI system can’t accommodate a customer’s needs of if they simply prefer to speak with a person instead of an AI system.

Papa John’s new AI phone system can also deepen customer loyalty, since Papa Rewards members can earn points by placing phone orders when they provide the phone number associated with their account.

During its Q3 earnings call, Papa John’s CEO Rob Lynch said, “the one-to-one marketing platform is also a growth driver and strategic technology priority for us.” He added that loyalty members “drive outsized revenue” compared to non-loyalty members. Not only do they drive higher ticket averages, but also higher frequency. Papa John’s plans to expand the system to 1,000 stores across 37 states by 2021.

There is no doubt Papa John’s is benefiting from its digital initiatives. In January 2021, Yahoo! Finance reported the company’s shares have gained 17.4% compared with the industry’s 4.5% growth in the past three months.4

 

Digital Ordering Works for the Customer and the Business

It’s interesting to follow how consumer behavior will continue to drive AI improvements to online and mobile ordering platforms while ensuring the best possible customer experience and maximizing profitability for the brand. It’s a win-win for both consumers and operators in the QSR space. #AIisheretostay

Sources: 1-2 Nation’s Restaurant News; 3 PYMTS Feb 2021; 4Yahoo! Finance

 

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WHICH COMMERCIALS WON THE SUPER BOWL?

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Uber Eats, Wayne’s World

https://www.youtube.com/watch?v=D-Q3HNp6dew&feature=emb_logo

 

Almost 30 years later, Wayne and Garth are back in their basement, still doing their local cable access schtick. No way! WAY!!! This time they are encouraging people to “eat local”, albeit subliminally. The spot plays off one of the most memorable scenes in the original Wayne’s World movie when they said they would never bow to any sponsor. NOT!!! They then proceeded to spend the next minute displaying Pizza Hut, Doritos, Reebok, Nuprin and Pepsi products.

 

In their Super Bowl spot, Uber Eats is looking to gain Boomers’ business, while reinforcing its brand with Millennials. Not gonna lie, my Millennial daughter did have to tell me who Cardi B was. And Cardi B was not out of place given singer/actress Tia Carrere’s role in the first Wayne’s World film. The boys were culturally on trend in the commercial with the TikTok clothes-transition scene. Not sure we’ll be seeing a new Wayne’s World movie anytime soon, but the creator of this spot did an excellent job of connecting Uber Eats’ “eat local” campaign with Wayne and Garth’s local cable access show.  Party on boys!

 

Maria Topken, VP, Client Leadership

 

 

 

T-Mobile, Rock Star 5G

https://www.youtube.com/watch?v=HxllNfjYw2U&feature=emb_logo

 

The T-Mobile ad was my favorite. It’s a reference to pop culture but also tries to drive home how easy it is to butcher communication with poor cell service. It’s funny, relatable and sells the brand without pushing a phone or T-Mobile directly. This also becomes relatable if anyone watches the Voice because of the dynamic between Adam and Blake. Definitely made the friend group chuckle!

 

Shannon West, Social Media Strategist

 

 

 

Indeed, The Rising

https://www.youtube.com/watch?v=pZodu9AgwZE

 

One Super Bowl LV spot that hits the mark is Indeed’s “The Rising”. It’s Indeed’s first-ever spot in the Big Game and has unfortunately been receiving some attention because it uses the same stock video clip as Guaranteed Rate, another first-time Super Bowl advertiser. Putting that embarrassing situation aside, “The Rising” beautifully illustrates the range of emotions a job seeker experiences during a typically unpleasant and frustrating process and, more importantly, how Indeed helps make things better. The spot features actual job seekers and uses no voice-over, only type on the screen with video showing the range of emotions people experience as they search for their next job. The choice of music, “Rise Up”, sets the tone perfectly and the lyrics move the spot along providing the feeling of hope and joy the people on the screen are searching for and that Indeed can provide.  Given how relevant this topic is right now for many Super Bowl viewers, the use of emotion and real job seekers will connect Indeed’s message, “we help people get jobs,” with their audience.

 

Brian McHale, CEO

 

 

 

Michelob ULTRA, Organic Seltzer “All-Star Cast”

https://www.youtube.com/watch?v=3F1KdZCJ6Vg

 

This commercial was a real attention grabber! By playing off the use of lookalike actors/actresses of Megan Fox, Don Cheadle, Sylvester Stallone, and Serena Williams to name a few, Michelob ULTRA keeps your attention with their new organic seltzers. “New Michelob ULTRA Organic Seltzer is real… and it tastes that way.” Not only does this commercial have a strong message and “big names” to deliver value, but the reveal of imposter actors/actresses will make you want to rewatch it! An all-around great Super Bowl commercial from Michelob ULTRA.

 

Alex Jones, Social Media Specialist

 

 

 

General Motors, No Way Norway

https://www.youtube.com/watch?v=yCy-a_E2I3s&feature=emb_logo

 

The Gold Medal goes to GM for turning Electronic Vehicle sales into a quasi-Olympic competition. They managed to create a commercial for their universal Ultium battery that appeals to both ends of the political spectrum in a way that feels totally apolitical. Out of the gate, we learn that the mighty US trails tiny Norway in EV sales per capita. Will Ferrell stirs our uber-competitive, nationalist, America First spirit with the battle cry, “we’re going to crush those lugers.” He then enlists Kenan Thompson the pirate, who ditches his daughter’s birthday party to join the fight. And Awkwafina the archer, who brings a touch of Hunger Games to the mission. This broad coalition bands together (in separate vehicles) to promote a global-conscious, climate-friendly initiative. Soon, everybody can drive an EV. Somehow, uniting the great divide with a common purpose. Something even The Boss couldn’t do. Everybody in. Well played, GM.

 

Tim Hogan, VP, Executive Creative Director

 

 

 

Bud Light, Last Year’s Lemons

https://youtu.be/g6CVKs77X74

 

Bud Light shows us that you can make something great out of a less-than-awesome situation, or in our case, a less-than-awesome year. I was very impressed with their ability to showcase what happened in 2020 (i.e., cancelled flights, bad haircuts and just pure chaos) and portray it in a comical way with raining lemons, with my favorite scene being the wedding where guests (hilariously) run for their lives from the lemon storm and the bride and groom sob under their gift table. And we thank you, Bud Light, for making good use of all those lemons we were handed in 2020!

 

Desi Gilliland, Account Executive

 

 

 

Bass Pro Shops & Cabela’s, Get Back To Nature

https://www.youtube.com/watch?v=yfLz54hzpPs&feature=emb_logo

 

The Bass Pro Shops/Cabela’s Get Back to Nature spot really hit home for me and my family. Like most Americans, we are currently dealing with a serious case of prolonged cabin fever. This spot reminded us that “The great outdoors are wide open.” There is so much we can do to get out and enjoy everything that the world and nature has to offer. It made us all want to leave our phones and devices behind and go for a hike, go kayaking or go camping and get some fresh air. It gave us a sense of hope and a reminder of what life was like before the pandemic and what it can be again. Hopefully, very soon. We’re all one family in the great outdoors.

 

Bill Brassine, VP, Media Director

 

 

 

Toyota, Upstream

https://www.youtube.com/watch?v=fqWG5_7nwyk&feature=emb_logo

 

The Toyota ad was my favorite. Yes, I saw it was Toyota. “Life won’t be easy” featured a baby girl from Siberia who had to have her legs amputated and was adopted anyway. The parents decided that even though her life would not be easy, they were ready to love her and help her overcome all challenges. They knew it could be an Amazing Life! It was so sweet and inspiring to see her swim and compete in the Paralympics. Life, in general, is about hope and strength! No matter if there is a pandemic or just the normal stuff life in general throws at you. It’s all in the drive and determination, our lives can be amazing if we persevere and strive to be our best! So sweet, it captured my heart.

 

Kathy Staarmann, HR Director

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THE STATE OF DIGITAL ADVERTISING

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There are many different types of digital ads, each designed for a specific purpose. Some lead you to a website, others direct you to purchase. And most are cleverly served to match your profile or a recent interest. That’s why we advertisers value them so highly. They help us target our customers more precisely and impact their purchase decisions when it’s most relevant.

Here’s an overview of four of the most used types today:

  1. Search Engine Marketing

Search Engine Marketing (SEM) is a great way to target consumers who are actively seeking a product or service. Google is the gorilla in this room. They run 75,000 searches per second and are preferred by 92.54% of users. If you add in others like Bing and Yahoo the overall search rate increases to 96.62% of users says webfx.com.

Within SEM we also have Search Engine Optimization (SEO) and Pay-Per-Click (PPC) Advertising.

SEO is a set of techniques and strategies to gather organic traffic to your website using links, keywords, and quality content relevant to readers.

PPC allows marketers to only pay for users who click on their ads for more information, as you can see in the example above. This is a highly efficient way to stretch your marketing budget by focusing only on consumers who engage with your ad.

  1. Display Advertising

This form of digital advertising is like traditional advertising as it relies on images and text to attract the user’s attention.

These ads are placed on specific websites that match the demographics and psychographics of the desired target audience.

Different sizes and placements on a website allow advertisers flexibility in on how to display their ads, much like print ads of the past. Static banner display ads are the most common, but advertisers also have the options to create animated, video, and interactive ads to capture more attention in the cluttered digital environment.

3. Social Media Advertising

 

Social media is another highly effective way to talk to your audience. According to statista.com, the number of active monthly users on Facebook is over 2.6 billion as of July 2020. You Tube, WhatsApp and Instagram account for over 5 billion active monthly users combined. On average, studies have shown that users of these channels spend nearly one hour per day watching content says oberlo.com. It’s no coincidence that advertisers are increasing budget allocations to these channels. Dollars go where they eyeballs are. And social media ads are relatively low in cost, so companies can efficiently target their customers and track results of how the campaign preformed.

Targeting on social media, however, may be getting a bit more difficult as Apple recently announced that their latest mobile operating system will make it harder to target advertisement at users, possibly cutting into revenue for businesses that rely on such ads.

Facebook has taken exception to the changes resulting in a public feud between the two companies. Apple said in a statement that through the changes, the company is standing up for its customers, who should be aware of when and what data is collected and shared. “App Tracking Transparency in iOS 14 does not require Facebook to change its approach to tracking users and creating targeted advertising, it simply requires they give users a choice,” the emailed statement reads. This issue is far from over.

  1. Email Marketing

You may feel that email is becoming a dinosaur. A relic of the early digital age. But it’s not so. According to Statista, the use of email marketing is growing between 2% and 3% per year until 2023. A survey from Adestra showed that 73% of millennials prefer the use of email to communicate with companies and a DMA Insight study indicated that 99% of consumers still check their email daily.

In order to garnish the average ROI of $40 for every $1 spent, a brand needs to have these four areas figured out: gather qualified subscribers, engage with the public, keep the audience engaged and have automation tools to help.

Digital Ad Spending Continues to Rise

Despite the pandemic which created headwinds for overall ad spending in 2020, Statista.com expects total digital media spending for 2020 to be up 2.8%. And the forecast for 2021 is even more robust with a projection of 7.3% growth.

In 2018, TV and digital each accounted for about a third of the total U.S. advertising spending. The fastest-growing medium – digital – is projected to have reached a 40 percent-share by the end of 2020 says Statista.com. Total advertising spend in the U.S. is projected to reach 200 billion dollars in 2023. That’s 80 billion being invested in digital advertising!

There’s good reason for that shift. Digital advertising is generating strong results. This blog post just begins to scratch the surface on the strengths of these areas. Strategies to employ digital ads vary by industry and company, but if your company isn’t taking advantage of these trends, you may be missing out. The next time you see a digital ad, take a moment to think about how and why that company targeted you. And if it’s an investment well spent. They did.

 

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