Gen Z make up 40% of the global consumer population, according to global research and consulting firm McKinsey. The Influencer Marketing Factory reports 97% of Gen Z turn to social media as their main source of shopping inspiration. Another report by Statista shows 54% of Gen Z say social media is better than online search when it comes to discovering new products. With this demographic wielding increasing buying power, brands know better than to ignore them.

SELLING EXPERIENCES, NOT PRODUCTS

Product-focused sales have become tacky, especially for a generation that values authenticity and engagement. And, as Jeremy Finch wrote for Fast Company way back in 2015, “Gen Z have a carefully tuned radar for being sold to and a limited amount of time and energy to spend assessing whether something’s worth their time.” What works instead is creating immersive narratives that offer unique journeys, personalized services, and memories that transcend the product’s functionalities.

Adidas is appealing to Gen Z through digital assets like NFTs. “For many brands and consumers, the value of NFTs doesn’t come from the token itself, but from the sense of community built around it,” says Rohan Handa, senior vice president for business development at Horizen Labs Ventures, a digital asset advisory and solutions platform. “It creates a shared experience and exclusivity that draws people in [and] for a population that evolved with Web 2.0, social media, and the mobile-market Web, it is normal that Gen Z users value their digital identity more than people from Gen X, who sometimes don’t even have one.”

Walmart, on the other hand, has plans to create two immersive Roblox gaming experiences—Walmart Land for buying virtual merchandise and Walmart’s Universe of Play for toy games. This, according to Walmart’s marketing chief William White, is a strategy to “increase brand favorability with younger audiences” and “drive relevance in cultural conversations.”

“Gen Z is a digital-first cohort [and] digital identities matter to these participants,” says Horizen Labs Ventures’ Handa. “Digital avatars like those done by Ready Player Me, in-game skins/assets similar to the ones in Fortnite and Roblox, ticketing and token-gated sales by Ticketmaster, and collectible NFTs like NBA top-shot are some top-of-mind use cases, and where a lot of Gen Z is headed.”

BUT IF SELLING PRODUCTS, DO IT SOCIALLY

The market size for social commerce—that is, a form of e-commerce that combines social media, online communities, and user-generated content—was estimated to be valued at $584.91 billion in 2021 and is set to grow before the end of the decade, with a projected market value of $6.2 trillion in 2030.

The idea of social commerce is a relatively new phenomenon characterized by its use of social media platforms to facilitate the buying and selling of products and services. While social commerce is still in its early stages, it has the potential to revolutionize the way we shop online.

“It is more important than ever for brands to implement a social commerce strategy that captures their young and increasingly influential audience,” says Roy Avidor, cofounder and CEO of Cymbio. “To a large extent, this booming shopping trend is due to Gen Z, who dedicate a lot of time to browsing social channels.”

With inflation and the cost of goods rising, it’s more important than ever for retail businesses to retain existing customers, especially when the cost of acquiring new ones can be up to five times higher. This is where social commerce can help brands of all sizes.

COMMUNICATING WITH GEN Z

Whether it is from their favorite brands or persons, genuine and transparent interactions are necessities for Gen Z. In the words of Avi Pardo, cofounder and chief revenue officer at communications platform LeapXpert, “More than anything, Gen Zers just want to be seen. . . . Should a Gen Z member feel like they are merely a statistic in a customer relationship management system, they will disengage.”