Just when we started noticing the power of Generation Z—the group of teens and young adults coming up behind Millennials—here comes Generation Alpha. Why should brands care about them? For one, they have more spending power than any pre-adolescent generation before them.
Australian social researcher Mark McCrindle coined the youngest among us “Generation Alpha” back in 2005. The generation is defined as those born after 2010 (and who are still being born). His rationale for the name?
“Generations Y and Z are often referred to as 21st-century generations. However, this upcoming generation is truly the first millennial generation because they are the first to be born into the 21st century,” McCrindle explains.
The oldest kids among Generation Alpha were born the same year the iPad debuted. They were practically born subscribing to YouTube channels. They are the first generation to be fully born into a holistically digital world.
Marketers don’t usually start valuing a generation from a consumer standpoint until that generation reaches its teen years. But Gen Alpha is different. Not only is their reliance on tech unparalleled, so is their purchasing power through those devices. Consider these stats:
- Four out of five (81%) Gen Alpha kids significantly influence family purchases.
- Children under the age of 12 influence $500 billion in purchases per year.
- Nearly half (46%) of kids 16 and under have direct access to an Amazon Prime account, and it’s their favorite place to spend money.
Before creating marketing campaigns to sell to Gen Alpha super-shoppers, though, take a moment to consider a critical hurdle to overcome: the legality.
While it does seem more kids have access to impressive amounts of spending money these days, that doesn’t mean brands have free reign over gaining that wallet share. The FTC highly regulates how brands can market to and interact with children online, mostly through its Children’s Online Privacy Protection Rule (COPPA). COPPA includes special requirements for privacy policies, collecting information including geolocation data, and more. Newly proposed bills in both the U.S. House and Senate could create even more checkpoints for advertising and marketing including banning the use of target advertising to users under 13 and strengthened privacy and cybersecurity measures.
If you deliberately market or advertise to children or create apps and websites for them, you’re likely fully aware of COPPA nuances. But the FTC warns, even “if you run a site directed to a general audience or operate an ad network, plug-in, or other third-party service used by kid-directed sites, you may have COPPA compliance obligations, too.”
Gen Alpha has access to more sites and products than, perhaps, their parents even realize. Suddenly your brand may become a sleeper hit among the elementary set and, therefore, COPPA rules you never considered before are slapping you in the face.
What about your responsibility for ads that run on your site or app?
Do you ask age-related questions? (Most brands aren’t required to investigate the ages of users but once you ask for data that establishes age, COPPA compliance requirements can be triggered.)
Even Google and YouTube recently misjudged the rules, resulting in a record $170 million FTC settlement for collecting personal information from children without their parents’ consent.
Gen Alpha, with all its shiny new characteristics, is an equally fun and challenging cohort for digital marketers. And, unlike generations before them, many are already logged in and able to buy from you online. The responsibility of selling to them—whether deliberately or not—has arrived.
In other words, ready or not, here they come.
Photo by Andrea Piacquadio