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Generation Z Consumers and the Future of Branding

By Dr. Karling Lee

A brand is often seen as the idea or image that customers or consumers have in mind when thinking about specific products, services of a company, in a practical (the dress design is trendy and functional) as well as emotional manner (the dress makes me feel beautiful).

Therefore, having a strong brand has become a crucial differentiation point to stand out from the competitors and be the purple cow.

However, will the current branding strategies and focus be able to weather the storm of the new onslaught of Generation Z (Gen Z)?

This is a critical question for many companies and organizations as so many have got it wrong when it comes to Gen Z.

Referring to previous articles on who are the Gen Zs (born between 1998-2000 onwards, with 1998-200 being cuspers Gen Zs), it is predicted that in the next 3-5 years for Asia, Gen Z is likely to have the highest purchasing power parity as compared to previous generations although the largest population remains the Generation Y (Gen Y).

However, population size does not always equate purchasing power parity.

Gen Z as a generation is the most likely to “cancel” or “boycott” a brand as compared to Gen Ys (approximately 40% vs 16% and rising for Gen Z).

What causes a Gen Z to stop buying from a specific brand? Below are some of the reasons.

… it is predicted that in the next 3-5 years for Asia, Gen Z is likely to have the highest purchasing power parity as compared to previous generations although the largest population remains the Generation Y…

Meaningless and unsubstantiated claims by the brand – Gen Z expects brands to live up to expectations and adhere to its values, beliefs and convictions. Brands that tell the truth are preferred.

Gen Z needs to trust a brand before considering the brand. It is becoming increasingly important to focus on the VALUE proposition for the Brand instead of merely the USP (unique selling point). Gen Zs are big on value that a brand brings to them in order to relate.

Avoid using “Tokenism” as a promotional campaign. For the Gen Zs, if the Brand is championing a cause, it must show that it is genuinely and positively taking actions to advance the cause it purports to champion.

Putting up a “façade” attracts Gen Ys, but not the Gen Zs.

Using more visual cues and designs that are creative and out-of-the box often attract the Gen Zs more than re-used, clichéd and unimaginative ads. For some Asian Gen Zs, being creative and imaginative with out-of-the world ads speaks out louder as these Gen Zs read novels and watch animations that spew out such content.

Positivism works better with Gen Zs too in terms of framing messages, reaching out, empowering and creating celebrations.

The above are not the only reasons for companies and organizations to re-think the future of branding as the Gen Zs become a force to reckon with.

Remember too: Research has shown that Gen Zs are great influencers of respective parents who are mostly from Generation X (Gen X), though some are from the older Boomer generation or the younger early cusper Gen Ys. Dr. Karling Lee is an annual favourite at the Malaysian CMO Conference, her groundbreaking studies are highly-sought out by marketers who know what works best for their brands. Her expertise in deciphering the digital generation is based on real time surveys and reporting.

This article was first published by Marketing Magazine. Permission to use has been granted by the publisher.

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