This article was updated in September 2021.
In mid-2020, the Center for Generational Kinetics and WP Engine released a comprehensive new study, Generation Influence: Gen Z and the Power of Identity and Marketing. It explores two key aspects that make up their relationship with all things digital: identity and influence. Read more.
According to a semi-annual survey conducted by investment bank Piper Jaffray, Taking Stock with Teens, Gen Zers spend their copious amounts of free time watching videos on YouTube, shopping on Amazon, and eating at Chick-fil-A.
But aside from their penchant for Chick-fil-A dipping sauce and its subtle sweet undertones of honey mustard, there are some prime nuggets in the study that tell us even more about what makes Gen Z tick, and how we as marketers can reach them where they are, and where they’ll be.
The survey evaluates discretionary spending patterns, fashion trends, technology, and brand and media preferences. An impressive 83% of teens have an iPhone, and they’re not afraid to use it. In fact they’re hardly ever not using it. But their prolific screen time, as documented in the WP Engine study, Reality Bytes, is a very good thing for brand experience.
YouTube killed the Netflix star
For the first time Gen Zers are spending more time watching videos on YouTube than on Netflix — 37% versus 35% — and report using YouTube at least once a week. However Netflix ranked far ahead of its streaming video competitors like Hulu and Amazon Prime. (A bright spot for Netflix? At least teens use it as a verb.)
According to Google, Gen Zers consider YouTube content educational with 80% saying that YouTube videos have helped them become more knowledgeable. It also makes them feel good: 84% of teens report feeling overwhelmed and stressed by school and activities and they say YouTube allows them to decompress.
If you want to know how important video content is to your overall marketing strategy, consider this: Teens watch an average of 68 videos per day across social media platforms. A good portion of that viewing time is spent following YouTube influencers like identical twins Brooklyn and Bailey. While you might not think that twist faux braids are a crucial part of teen life, their 6.5 million subscribers would disagree.
A study released earlier this year from business news website The Manifest found that three-quarters of Gen Zers prefer images over other content, from Instagram to Snapchat. Not surprisingly, Instagram remains the top social media site with this image-obsessed generation although short video platform TikTok is definitely on the rise. Meanwhile Facebook and Twitter have basically become the domains of meemaw and pawpaw. (Only 36% of teens use Facebook at least once a week, compared to 87% of Millennials, 90% of Gen Xers, and 96% of baby boomers.)
Gen Z will make up 40% of online consumers by next year. An estimated 90% of teens are already consuming branded content on social media. However the Piper Jaffray survey found that teens are spending 4% less than they were a year ago and one-third of them believe the economy is getting worse. That may be one reason why more casual and athletic brands like Crocs and lululemon have become increasingly popular.
More than half of Gen Zers say they prefer shopping on Amazon over other retailers, which is ranked 13 times higher than Nike, its distant runner-up in the online marketplace. They’re also twice as likely to shop on mobile than Millennials.
Money well spent?
Speaking of spending habits, male teens spend the most on food (23%) while female teens spend the most on clothing (27%), replacing cosmetics, which is down 21% year over year. Over 90% of females say they prefer shopping for beauty products in-store instead of online. (In fact 67% of Gen Zers do most of their shopping in-store.) And don’t discount video game spending, which reached 9% this year, up from 8%.
Overall, Gen Z spending is at its lowest level since Fall 2011. Marketing to them on a broad level will require a multi-platform social media strategy. But better to start with YouTube than, say, Facebook…