Guest Authored by Nima Patel

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Generation Z, a demographic defined by its digital nativity and unique purchasing behaviors, is reshaping the retail landscape. As we approach the 2023 holiday season, it is essential for brands and marketers to understand this generation's distinct preferences. This deep dive explores the multifaceted world of Gen Z shopping—from their trust in influencers and reliance on platforms like TikTok to their value-driven purchase decisions.

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The Digital Landscape:

A study conducted by Meta found that 70% of Gen Z turns to online channels for their holiday shopping. Their affinity for the digital world is reflected in their shopping habits, and they have a plethora of digital platforms to draw inspiration from. Amazon.com is a pivotal destination, with 46% of Gen Z stating that they used the site for holiday gift ideas. Gen Z appreciates the convenience and variety offered on Amazon, allowing brands to advertise their products on the user-friendly website without the need to expend resources replicating these values. By meeting consumers where they are, brands need not worry about driving traffic to their own sites.

Instagram closely trails Amazon with 43% of Gen Z using the platform for inspiration, while another 18% turn to TikTok. Despite the ascent of TikTok, Instagram remains a dependable source of inspiration for this demographic. Instagram users curate their homepages themselves and are exposed to content that aligns with their preferences. Conversely, TikTok employs a more spontaneous algorithm, making it challenging for Gen Z to find holiday ideas that match their tastes. Furthermore, Instagram holds seniority in the social media world, establishing itself as the platform that Gen Z can rely on for solid gift ideas. Nevertheless, it's worth noting that platforms like TikTok may undergo a transformation from entertainment to trusted sources of information in future Q4 seasons. For instance, TikTok Shop usage is on the rise in 2023, with 33% of TikTok users making purchases through this tool (Online Dasher). Brands can be proactive by integrating with TikTok Shop this season to prepare for its growth in subsequent Q4 seasons. Social media has already proven to be a pivotal platform for brands seeking to engage with Gen Z. However, research indicates that senior platforms and websites like Amazon and Instagram are the most effective means of reaching this generation during the holiday season.

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Influencer-Driven Purchases:

In addition to establishing a platform presence, brands must also reach Gen Z through effective content. Meta found that for 28% of Gen Z, influencers have become primary sources of holiday purchase inspiration. Brands that collaborate with the right influencers stand a higher chance of earning the Gen Z seal of approval (and their dollars). Rather than merely browsing, Gen Z is influencing and being influenced, blurring the line between online consumers and creators. Many creators have set up Amazon Storefronts for their followers to easily navigate for their holiday shopping needs. Social media influencers and content creators alike possess the power to guide their audience to brands they endorse, inspiring consumers to make purchases through platforms like Amazon Storefront. The holiday season is the optimal time to collaborate with influencers, as Gen Z's purchasing activity is at its peak.

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Values over Vanity:

Gen Z has demonstrated a preference for ethical brands, a behavior that carries over into the holiday season. The digital landscape is saturated with information, and this generation has adapted to the constant influx of content. They use this knowledge to voice their opinions and influence their purchasing decisions, which in turn impacts their holiday season shopping behavior. Meta found that 30% of Gen Z wishes to see brands publish "trustworthy" content. This means they expect information to be direct and honest, devoid of hidden sales tactics or product misrepresentations. Furthermore, 37% of Gen Z is influenced by a brand's social responsibility, with 57% believing that brands should find ways to give back during festive times (Meta). Brands that exhibit a social mission, rather than solely focusing on profit, can establish a deeper connection with Gen Z consumers. This is a pivotal moment to focus on achieving a social goal, as the festive spirit inherently involves giving back to the community. Brands that authentically showcase this commitment are likely to resonate more deeply with Gen Z, facilitating purchases based on shared values and trust.

Brands in the Age of Gen Z:

Understanding Gen Z is one thing, but how should brands approach this unique demographic?

1. Digital Diversification: Ensure a presence across various platforms, from Amazon to TikTok. It's crucial not to overlook traditional websites like Amazon, which see high traffic during the holiday season as influencers often use Amazon Storefront links, and consumers engage with the homepage for product discovery. Instagram and TikTok remain popular platforms during the holiday season, and brands should consider allocating advertising budgets to these platforms.

2. Leverage Creator Collaborations: Creators have become the modern-day celebrities, and tapping into their reach during Q4 will ensure your brand gains visibility. Concentrating on creators who curate shopping lists or storefronts creates a path for consumers to easily discover your brand through accounts that already have a reputation for offering quality product recommendations.

3. Embrace Your Values: Be transparent, authentic, and value-driven. Remember, Gen Z is more likely to engage with brands that align with their personal values and ethics. Q4 is the perfect time to embody this ethos, as there is already a prevailing sentiment of giving back during the holidays.

Navigating the Gen Z landscape may seem daunting, but it presents vast opportunities for brands willing to adapt and evolve. Reevaluating digital strategies, fostering authentic influencer partnerships, and prioritizing genuine social responsibility efforts can yield long-term value and revenue this holiday season.

For brands seeking to deepen their understanding of Gen Z and tailor their strategies, please connect with hello@backgroundnoise.co. We can help align your brand with the ever-evolving preferences of Gen Z.

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