This blog is a part of our “Insight to Impact with Mintel Consulting” series, where members of our Marketing Intelligence team expand on sections or points from Comperemedia reports. Today’s piece is an extension of Nicole Bond’s trend report Audience Strategies: Understanding Gen Z Nuances. (client-only link)
As a young and fast-growing generation, Gen Z is in need of brands, products, and services that help them smoothly transition into adulthood. With their purchasing power on the rise, Gen Zers are a must-reach audience for brands looking to usher in the next generation of consumers.
Within the approximately 60 million Gen Z consumers is a key segment: those who are financially healthy, a segment we’ve dubbed the Advanced Enthusiast. “The Advanced Enthusiast is likely looking to make their lifestyle aspirations a reality—and they’re entering a financial position to do so in the near future,” says Nicole Bond, Associate Director of Marketing Strategy (Comperemedia).
Indeed, household income is a major indicator of how brands should connect with Gen Z.
Affluent Gen Zers may be the smallest group within their generation, but they have the spending power to make a dent in revenue. Reaching these consumers depends on messaging, imagery, and channels that cue lifestyle upgrades.
Comperemedia examined financial services opportunities (client-only link) for reaching Gen Z, such as entertaining educational messaging and personalization. Building on this research, Mintel Marketing Intelligence analyzed competitive advertising spend and creative strategies to uncover opportunities for brands in other industries as well, such as CPG, retail, and travel.
Make it aspirational
Affluent Gen Z’ers are eager to upgrade elements of their life in order to achieve their aspirations of adulthood. This can mean purchasing items deemed higher quality, healthier, more sustainable, or a better long-term investment that helps younger consumers adopt more sophisticated routines.
In fact, a quarter of Gen Z adults believe that being able to afford luxuries is an important measure of financial happiness, higher than any other generation. As long as a brand communicates the product as a step up from other options – it can be positioned as a solution to finally coming into true adulthood.
Using Mintel’s Marketing Intelligence capabilities, we’re able to see that CPG brands like OliPOP, the Ridge, and Our Place encourage consumers to upgrade to its products from inferior options, such as sodas high in sugar, bulky and disorganized wallets, or cluttered kitchens filled with low-quality cookware.
Dollar Shave Club helps young men refine their grooming habits with education on haircare and skincare, as well as offering bundles of products that make it easy to adopt a new routine quickly.
Others cue aspirational living by featuring celebrities that signal success or utilizing sophisticated lifestyle imagery that younger consumers are anxious to achieve. The key to making this unique to your brand is ensuring influencer or celebrity partnerships are authentic and the lifestyle imagery is cohesive with other branded elements. Consider tapping a celebrity or influencer who already uses and advocates for your products so that the eventual partnership feels more natural.
Getting the channel strategy right
Meeting Gen Z’ers where they plan for their lifestyle changes will also be important to introduce products at the relevant time. Both Pinterest and TikTok are used as a discovery source for inspiration; nearly 50% of those that have hosted a social gathering at home in the last year used Pinterest for inspiration and four in ten used TikTok. But the opportunities can go beyond social gatherings and range from home improvement and cooking recipes to investments in curated beauty and apparel collections.
Behr has a well-established inventory of content on TikTok so that when younger consumers are ready to paint their living spaces they’ll already have the brand in mind. And while Lush has halted activity on all other social media platforms, it has continued to promote its sustainable and high-quality bath products on Pinterest.
Lean into exclusivity
Exclusivity will also enhance the appeal of products and services to those wanting an elevated experience from brands.
Membership-exclusive deals reward consumers for their loyalty and make shoppers feel special. While financial services brands often reward their customers with exclusive access to airline lounges or memberships for popular streaming or delivery services, CPG and retail brands can focus more on merchandise. Delivery brand and convenience store Foxtrot rewards its members with exclusive deals on popular merchandise, such as trending wines. Sephora’s annual savings event offers all members a discount, but its highest Rouge spenders get an additional percentage off during the sale.
Specialty merchandise can signal quality, novelty, and limited availability – all things that help younger and more affluent Gen Z’ers grow into their desired aspirational aesthetic. Tyler the Creator’s Golf le Fleur brand as well as apparel retailer Uniqlo offer specialty collections that consumers cannot get anywhere else.
Adopt a “can’t miss” message
Scarcity can be instrumental in driving demand. Affluent Gen Z’ers have the ability and willingness to impulse shop, making them a strong audience for messaging that emphasizes urgency, whether due to limited availability or popularity. This will be especially impactful for brands in oversaturated markets, such as beauty.
One way brands that are popular with Gen Z drive urgency is by announcing when their best-selling items are back in stock or emphasizing which items have sold out in the past. Kim Kardashian’s SKIMS brand, Selena Gomez’s Rare beauty brand, and Emma Chamberlain’s beverage brand Chamberlain Coffee have all adopted this strategy to keep shoppers on their toes and ready to act during restocks.
Promoting seasonal designs, flavors, or colors also imply products with a short availability window. Better-for-you beverage brand Olipop often promotes its seasonal flavors alongside messaging that pressures consumers to take action quickly.
What we think
Not only is this smaller segment of Gen Z lucrative due to their spending power and willingness to try new brands, but they will also likely act as trendsetters to others in their generation as they play catch up on household income and lifestyle stages, making them an important gateway audience into the larger generation.