While much of the marketing world has spent the past decade figuring out millennials, the cohort behind them, Gen Z, has grown to represent 25% of the Canadian population and $50 billion in buying power.
It’s a powerful consumer segment. It’s also one with distinct behavioural, attitudinal and shopping patterns, according to new research by the student focused agency Amplify Solutions conducted with The Globe and Mail.
There is a lot of research on U.S. millennials, but less for Canadian millennials, said Amplify CEO Kieran Mathew of the motivation for conducting the study. The survey of more than 1,200 Canadian consumers aged 16 to 23 covers a wide range of subjects to understand values, views and concerns as well as their media, purchasing and technology habits. The survey revealed a few surprises, said Mathew.
For example, young Canadians are generally more interested in “micro-issues” that affect them daily rather than the macro-issues. “Climate change and the economy were much less of a concern than [personal] health, finances and relationships,” he said. While 79% cited “staying healthy” and “good exam grades” as issues, and 69% said “relationships,” just 53% cited “climate change/overpopulation” and 32% said “income inequality.”
In terms of their consumer behaviours, the study revealed a surprising preference for old-school retail. There’s a common assumption that because young people are on their phones so much, they’ll be much more inclined to shop online, said Mathew. But the survey showed that’s not entirely true. “It was apparent that this generation does value the in-store experience,” he said. Asked if they usually make purchases online or in-store, just 16% said online, compared with 45% who said in-store.
Another common belief refuted by the survey was related to loyalty. “Generally when I connect with brands, they assume Gen Z is not brand loyal, but our survey shows the opposite,” he said. They are driven by value, but that is largely because they aren’t making much money. “If they find a product they appreciate and their peers accept it, then [marketers] have an opportunity to win a customer for life,” he said. Asked if they consider themselves to be loyal to certain brands, just 20% said no and 46% said yes (34% said it depends on the category).
Peer or friend recommendation is a significant factor, said Mathews, with 81% saying friends influence what they buy, and 73% saying they’re influenced by family. Online reviews were also important, at 62%, while just 17% said influencers.
Some of the other key findings from the survey included:
Alcohol and tobacco: “Gen Z consumes alcohol, tobacco, and cannabis with much less frequency and in less quantity than previous generations. They view these substances as taking a toll on them physically, and financially,” reads the report. Just 9% drink two or times a week, while 18% said once a week, 12% said never and 24% said rarely. Meanwhile, just 2% smoke and 8% said they smoke when they drink.
Cannabis: 77% support legalization and 23% do not; while 51% said they are cannabis users, 22% said they are not and 27% said they are not and never will be.
Education: 51% said they intend to get an undergraduate degree while 45% expect to get a post-graduate degree.
Financial: “Two in five state they have investments and/or high-income savings accounts and more than half indicate they actively save money each month,” according to the report. When asked to describe their financial situation, 26% said “I am comfortable,” and another 21% said their parents provide them money when they ask. Meanwhile, 23% said they are often worried about money and 21% said they have student loans or other debt.
Smartphone usage: Despite all the media coverage about smartphone addiction, just 14% said they are using their phone less than a year ago, while 32% said it has increased. Three to four hours was the most answered time-spent estimate, at 43%, while another 27% said five to six hours and 8% said seven to eight hours.
Favourite apps: And where are they spending their time? Instagram is the favourite app with 76% of respondents, while 71% said Facebook and 67% said Snapchat.
Gen Z said they are interested in news and finding trustworthy, well-written content is a priority, however a large majority of them say they get their news from “aggregators” like Facebook. “The reasoning behind that is they are less willing to pay for content, they are looking for content that is being shared on their social channels,” said Mathew.