Gen Z refers to the group of the population who were born in the years ranging from 1995 to 2010. This generation is known to be the true digital natives as they have been exposed to the internet, social networks, and mobile systems from the earliest stages of growing up. Gen Z is projected to account for almost half of the total U.S. consumers by 2020. This means that brands now have a new set of customers to target whose needs and behavior are much different from their predecessors. As this group of consumers are nuanced and highly complex, tried and tested customer retention strategies often fail to win the loyalty of these young and powerful consumers.
The younger generation has become potent influencers for different age and income groups and even play an important role in the way consumers relate to brands. Gen Z consumers tend to value individual expression and avoid labels. They are also believed to make decisions and relate to companies in highly analytical and pragmatic ways. According to experts at Infiniti Research, brands must include the following tactics into their customer retention program in order to win over Gen Z consumers.
The increased access to technology has given young consumers an unprecedented degree of connectivity. For brands, this trend will bring both challenges and equally attractive opportunities. RFP to know how our experts can help you identify market opportunities and build better customer retention strategies.
Customer retention strategies for Gen Z consumers
Invest in loyalty programs
One of the most crucial customer retention strategies that forward-thinking brands must consider is to invest in a customer loyalty program. Otherwise, sectors including media, retail, beauty, and CPG are at high risk of losing customers to their competitors. Gen Z is more likely to be loyal to brands that have loyalty programs when compared to millennials.
Be where the customers are
Gen Z is known to be highly active on social media and other digital channels. So, brands must base their customer retention strategies around these platforms. These consumers are also equally active offline. They expect to be able to check the availability of in-store products online and vice versa. These consumers are more likely to research a product before actually making the purchase. By investing in customer retention strategies like loyalty programs, brands can incentivize across different channels.
Formulating customer retention strategies for Gen Z customers is much more complex when compared to millennials or Gen X consumers.
Rewards for spend and engagement
Creating value by rewarding both spend and engagement is one of the most attractive customer retention strategies that top companies are looking at. Brands must ensure that their reward for spend strategy is frictionless across multiple channels. Such tactics are great customer retention strategies as they not only ensure customer engagement but also make things more convenient for customers.
Personalization using data
One of the key imperatives for effective customer loyalty and retention is to gain an in-depth understanding of the customers. To do this they need to continuously gather data about their customers across channels and use this data to identify customer needs and create better marketing strategies. Gen Z consumers are generally more willing to participate in surveys, provide their feedback on a service or a product, and socially connect with brands. Every brand that wants to capture the Gen Z audience must leverage data to offer personalization to customers and drive brand engagement and customer loyalty.
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