Are you ready for the new Marketing Funnel?
With the elder demographics of Gen Z now entering the workforce, they hold a significant share of wallet for brands, not only because of their disposable income but also because of their influence on family members and peers purchases. Being the first true digital native generation, it is no surprise that they truly understand digital marketing. And with an estimated $450 BILLION (USD) in spending power across the world, they can definitely make or break brands and trends.
New research from US youth culture agency Archrival and industry experts reveals how Gen Zs (aged between 12-27 yo in 2024) are stepping out of and reinventing the known consumer "path to purchase"...
Here is a recap of this fascinating research on the evolution of the traditional funnel and my take on how marketers and brands can better navigate this new consumer landscape.
Marketers have long relied on the traditional "consumer funnel" to guide their strategies, assuming a linear path from Awareness to Action.
However, Gen Z's unique priorities, influences, and digital fluency have blurred the lines of what a typical path to purchase looks like, creating an ever-evolving journey marked by Inspiration, Exploration, Community, and Loyalty.
Going from a Linear Journey into an Infinite Loop!
1. Inspiration:
Gen Z's quest for inspiration knows no bounds, particularly in the digital realm.
Social media platforms like TikTok, Instagram, and YouTube have become virtual playgrounds where style inspiration reigns supreme, with 77% of Gen Zs and 79% of millennials in the US actively seeking style inspiration at least monthly, with nearly half turning to social media for their dose of creative sparks.
Brands must navigate this landscape with authenticity and innovation to capture Gen Z's attention amidst the digital noise.
2. Exploration :
The exploration phase is where Gen Z consumers delve into product research, seeking authenticity, value, and peer validation.
Social commerce has gained traction, particularly in the APAC region, as platforms attempt to monetize this journey by integrating in-app shopping features. However, young shoppers remain discerning, relying on user-generated content, reviews, and comparison shopping to inform their purchasing decisions.
It's a dynamic landscape where brands must balance convenience with credibility to win Gen Z's trust.
70% of Gen Zs and 69% of millennials only trust a brand after carrying out their own research. And 56% of Gen Zs said “brands often lie about their products/services”, compared with 47% of millennials.
3. Community
Building a sense of community is paramount for brands looking to resonate with Gen Z.
Authenticity, inclusivity, and shared values are key drivers of brand loyalty, with young consumers seeking connections beyond transactional relationships. Brands like Madhappy (mixing perfectly apparel branding with mental health and wellness community events) and Represent (building both online and physical trendy community events) have mastered the art of community-building, offering not just products but immersive experiences and meaningful engagement opportunities.
54% of Gen Zs say that their favorite brands are the ones that make them feel like they're part of a community.
4. Loyalty
In the age of Gen Z, loyalty goes beyond repeat purchases; it's about fostering a sense of belonging and mutual respect. Brands must demonstrate their commitment to authenticity, innovation, and social responsibility to earn and retain Gen Z's elusive loyalty. User-generated content, social media engagement, and community initiatives are powerful tools in building lasting brand relationships.
54% of Gen Zs believing showing brand loyalty means simply telling your friends about a brand, even if they don't make a purchase.
Implications for Marketers: Peer-to-Peer Marketing is More Important Than Ever.
Adaptability is Key: Marketers need to embrace agility and flexibility to meet the dynamic needs of Gen Z consumers within the new non-linear marketing funnel. This requires a shift from traditional marketing approaches to more fluid, adaptive strategies that resonate with Gen Z's preferences.
Focus on AUTHENTICITY: Authenticity should be at the forefront of brand communication and engagement strategies within the non-linear pathway. Brands that authentically connect with Gen Z's values and aspirations will foster stronger relationships and loyalty.
Harnessing Digital Channels: Leveraging digital channels effectively is essential for reaching Gen Z consumers across their journey with your brand. Brands should prioritize omnichannel marketing strategies that encompass social media, influencer partnerships, and user-generated content platforms.
Community-Centric Approach: Building communities and fostering peer-to-peer interactions can enhance brand engagement and advocacy. Brands should facilitate opportunities for meaningful dialogue, co-creation, and shared experiences within their target communities.
Time to Adapt or Risk Being Left Behind
As Gen Z continues to redefine the consumer journey, marketers must adapt to the new realities of inspiration-driven exploration, community-centric engagement, and reciprocal loyalty.
By understanding and embracing the fluidity of Gen Z's consumer behaviors, brands can forge deeper connections and thrive in the ever-evolving digital landscape.
Sources:
Archival Agency
Vogue Business
Various Industry experts
And my personal take on it all.
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