Gen Z Influencers – Are Celebrity Endorsers Doomed to Extinction?

As Gen Z starts to dominate the consumer landscape, will celebrity endorsers lose their status? Quizzing my Gen Z college students about brands they’re loyal to and brand influencers, I find that they’re more focused on social media and peers than they are on advertising and celebrity endorsers.

As Gen Z starts to dominate the consumer landscape, will celebrity endorsers lose their status?

Quizzing my Gen Z college students about brands they’re loyal to and brand influencers, I find that they’re more focused on social media and peers than they are on advertising and celebrity endorsers. When asked to give examples of categories where they’re brand loyal, most of the female students turn to cosmetics, a category where the opinion leaders have traditionally been celebrities. Many female students reference little-known (at least to me) YouTube make-up artists, rather than celebrities. The beauty category may become the first to turn completely away from traditional celebrity endorsers. But what others will follow? This Gen Z trend will be a challenge for marketers to keep up with in a burgeoning consumer cohort.

“Influencers, such as Kylie Jenner and Huda Kattan have started successful beauty lines, built on their base of online followers. However, as social platforms become more crowded, some iGens are looking to more niche apps to express themselves, making it harder for brands to identify up-and-coming influencers.” Mintel, MARKETING TO THE iGENERATION US, MAY 2018

This new breed of beauty influencer is making an impact on Beautycon (think the Consumer Electronics for cosmetics). Moj Mahdara, Beautycon  CEO, notes “Nearly three-quarters of Beautycon’s target audience — Gen Z-ers and younger Millennials — say they are influenced more by ‘content creators’ than traditional celebrities, according to Beautycon’s research.” The New York Times, July 28, 2018

Cosmetics marketers are adapting.

“Our in-store marketing will feature authentic, real-girl product reviews, with the intent to teach the customer how she can use our products or why they’re trending, rather than to tell her what to buy.” Linda Chang, co-founder, Riley Rose Global Cosmetic Industry Feb. 1, 2018

“Although most beauty purchases are made in-store, more than 40% of Gen Z makes purchase decisions based on real-time social media feedback. A beauty brand’s packaging or product might catch their eye, but if someone’s influencers don’t like it? No sale.” Global Cosmetic Industry,June 1, 2018

What does this trend in the beauty industry mean for marketers in other categories? Are Michael Jordan and Dwayne “The Rock” Johnson about to lose substantial portions of their incomes?

Tech already depends on bloggers and YouTubers to explain, review and endorse their products. And while Nike relies heavily on celebrity endorsers like LeBron James and Serena Williams, they brand also pays homage to everyday people with its Dream Crazy campaign, encouraging everyday people to share their crazy dream.

In your view, what other categories are beginning to adapt to this Gen Z trend?

Generational Marketing: Gen Z Goes to College

I’ve taught in colleges since 2005, and have shared my observations about Millennials in several Target Marketing blog posts. Recently, I realized that most of my current students aren’t Millennials, so my curiosity about psycho-demographics has me trying to observe the generational marketing characteristics of this new cohort of college students, arbitrarily defined as those born starting in 1997.

I’ve taught in colleges since 2005, and have shared my observations about Millennials in several Target Marketing blog posts. Recently, I realized that most of my current students aren’t Millennials, so my curiosity about psycho-demographics has me trying to observe the generational marketing characteristics of this new cohort of college students, arbitrarily defined as those born starting in 1997.

Of course, changes in generational attitudes don’t occur overnight, and so I didn’t walk into class one semester and say, “Wow, these kids are different!” The oldest Gen Zers were freshmen in 2015 and because the lines between the generations aren’t always distinct, I don’t have a large sample on which to base my generalizations. But here are some of my initial observations based on some recent classroom encounters.

Technology and Ageism

Unlike the students of five-plus years ago, the current group does not automatically assume that older people (myself included) are digital idiots. Perhaps that’s because their parents are more technologically savvy and their grandparents have social media accounts. Although most identified their grandparents as laggards when it came to smartphone adoption in a recent assignment on the Diffusion of Innovation Theory, they don’t automatically assume that older people are technologically clueless. (See my post from 2016 on “Millennial Microagression”).

Financial Awareness

The cost of their education is always top-of-mind. It comes up frequently in classroom discussions about their consumption habits. Their formative years were marked by a time of economic uncertainty. In a recent marketing class at Rutgers, we were discussing how the economic environment affects marketing strategy and tactics. When I referenced the financial crisis of 2008, I realized that most of the students were in elementary or middle school during that time. Whether or not they experienced a parent’s job loss or home foreclosure firsthand, most understood that times were difficult and the financial future was not always assured.

Social Media-Cautious

In a recent assignment about retargeting, I asked them to cite examples of how their online activity led to seeing ads about things they posted or searched. Most referenced Google searches, and one student claimed that she was disadvantaged in coming up with examples because she has no social media accounts. Some have abandoned Facebook and, while they use Instagram, most keep their accounts private. By contrast, my experience with Millennials is that they were, and continue to be, much freer with their social media activity.

Look for more about Gen Z in upcoming posts.

Malls Bank on Experiences for a Successful Holiday Season

The holiday shopping season is in full swing! Where are consumers expecting to spend most of their shopping time? Not at a mall, according to the Synchrony Financial “2017 Pre-Holiday Study.”

The holiday shopping season is in full swing! Where are consumers expecting to spend most of their shopping time? Not at a mall, according to the Synchrony Financial “2017 Pre-Holiday Study.” The study shows that about 50 percent of consumers expect to do their holiday spending in a store, but out of that, only 38 percent of in-store shoppers plan to do that shopping in a mall.

Synchrony Holiday Shopper Insights In-Store PurchasesWhere will shoppers go instead of the mall? The majority of consumers (66 percent) say they will spend some time going to mass merchandiser retailers (e.g., Walmart, Target, etc.) and half of store shoppers say they will visit a stand-alone specialty apparel store.

The benefits of going into these stores are the one-stop shopping element. Mass merchandisers have a wide variety of items available at a relatively low price. So, you can buy a sweater for grandma and a toy for little Johnny without a lot of walking around. Stand-alone specialty apparel stores have the benefit of available parking and more personalized service.

Synchrony Holiday Shopper Insights Via GenerationsIf you do venture into the mall, the people you are most likely to see are Gen Z and Millennials. Those aged 18- to 25-years old are the ones who intend to spend the most time at the mall this year, with over 40 percent of them saying they will shop at a mall. The Gen X and Baby Boomer populations (aged 36 to 65) are the ones who say they will stay away. Only 33 percent of this population say they will be mall shopping.

Retailers have been putting an increased focus on strategies to get consumers to walk through their doors. Many retailers now give shoppers the ability to order online and pick-up in-store. This not only saves time for the consumer, but also gives the store the opportunity to up-sell or cross sell other items. Other retailers have been putting interactive experiences and restaurants in their stores to increase the “fun” factor. The last time I walked into a Williams Sonoma store, they were cooking an entire turkey dinner!

The future of the mall depends on maximizing these experiences. There are malls that have added restaurants, art installations and even amusement parks as part of the effort to draw more foot traffic. Many retail experts feel that the survival of the mall lies on its ability to attract shoppers with innovative services and entertainment, in addition to stores and products.

* Note: The views expressed in this blog are those of the blogger and not necessarily of Synchrony Financial. All references to consumers and population refer to the survey respondents from the Synchrony Financial 2017 Pre-Holiday Study unless otherwise noted.

The Making of a ‘Perfect’ Mobile Ad

The Verve whitepaper, “The Rise of Mobile Prodigies™: Millennials, Gen Z and the Future of Mobile Marketing,” provides some useful insights on engaging younger cohorts on smartphones (Millennials now have buying power of between $200-600 billion and Gen Z currently has $44 billion, according to the report).

Deliver_Brand_In_Digital2-2(1)While I was attending LiveRamp’s RampUp 2017 Summit last week, I attended a session on the “Skeptical Consumer,” which included a reference to recent research: “The Rise of Mobile Prodigies: Millennials, Gen Z and the Future of Mobile Marketing” (Verve, 2016). A good part of this session — which included speakers from the Digital Advertising Alliance, Venable, TRUSTe and Gap, as well as Verve — focused on how brands can overcome consumer skepticism over data collection with regard to digital/mobile advertising. (There’s much hope here.) The Verve white paper provided some useful insights on engaging younger cohorts on smartphones (Millennials now have buying power of between $200 and $600 billion and Gen Z, currently $44 billion, according to the report).

There’s a bevy of insights in the research, but I was particularly intrigued with one finding: What Makes a More “Perfect” Mobile Ad, as reported by these Mobile-First (mobile-only) users:

Source: “The Rise of Mobile Prodigies,” Verve, 2016, p 11.
Source: “The Rise of Mobile Prodigies,” Verve, 2016, p 11.

Too often, mobile is not driving most marketers’ brand engagement strategies — but not for long. These “Mobile Prodigies” are here and now, and they’re spending up to 90 percent of their smartphone time in the app environment — perhaps the majority of these apps are financed by advertising.

More than 55 percent of these consumers are using ad-blocking software and 82 percent delete apps that they perceive to fail to deliver value for the data collected … but oh, what relevance can do! Six in 10 would download more free apps, connect apps to their Facebook accounts, share location data and even share fitness and sleep data in exchange for a personalized experience. One in three say they reverse opt-out permissions when personalized ads, based on context and behavior, are offered.

Verve writes, “If we serve Mobile Prodigies best-in-class mobile experiences, they are willing to share their personal information — their permission comes down to relevance and reward.”

That sentiment actually mirrors that of Generation X and Baby Boomers. However, how that value is demonstrated in mobile requires a whole new level of branded experiences for Millennials and Gen Z, with a demand to use data in highly relevant and creative ways that still largely remains elusive on smartphones. Perhaps that’s why 2,500 were in San Francisco to examine better ways to deploy data in service to consumers, and 108,000 were in Barcelona a few days before — in part, in quest for the perfect mobile ad.