Millennials are the generation of people born between 1981 and 1996, though some experts place millennials into the early 2000s. Gen Z is the following generation born between 1997 and 2012. These two distinct generations are two of the largest demographics we can target in terms of creating new and loyal customers. Today we are going to look at the simple differences between these two generations and discover what incentivises them so you can be better placed to engage them effectively in your promotions and competitions.
Spending Habits
Millennials
Millennials are the first generation in the UK to earn less money than the generation before. So when you consider that they have reached places in their career where their parents already owned homes, yet rising prices mean that the majority of the millennials are renting, you can begin to see why their spending habits have shifted.
Millennials are considering more carefully where to spend their money. During the height of the pandemic, 50% of millennials believed that supporting small and local businesses was essential, and changed their habits accordingly.
This shows the general trend of millennials. They want to spend their money on health, well-being and things that benefit the community. They prioritise ethical purchases and 73% are willing to pay more if the product or service is sustainable or has a positive impact on the planet.
65% of millennial sales are on fashion alone.
And 50% of millennials said they are more likely to shop for food and drink in physical stores than they are online.
Gen Z
At the youngest, Gen Z is around ten years old and the oldest is only 26, their spending potential has yet to reach its peak. But understanding this generation now will help to cement your business’s customers for the foreseeable future.75% of all Gen Z sales are in fashion. Gen Z is also very much ethically minded, and desires to purchase products and services that have the health and wellbeing of the planet in mind, and are willing to pay extra for that privilege.50% of Gen Z also said they’d prefer to purchase food and drink from brick-and-mortar stores, even though they are the first digital natives, the first generation to grow up and not know a world without the internet.
Why Target Gen Z and Millennials?
Simply put these are the future spenders. As Millennials get older they are only going to increase their share of wealth and therefore their purchasing power, which means they are going to be a great generation to understand and maintain loyalty with.
Gen Z are the upcoming generation, some have entered the world of work but many are to follow, so if we wish to look to the future, as all businesses should, knowing as much about Gen Z as possible now, is paramount in ensuring longevity into the future.
Both Millennials and Gen Z are the main users of digital sales, with Gen Z growing up in a world that is always online. Understanding their habits and purchasing needs allows us to begin to shape the face of the digital marketplace to welcome and cater to them to gain a greater percentage of their spending potential.
Gen Z and Millennials aren’t averse to physical purchasing either, so finding out what they need to bring them back into stores will help to save the countless industries and businesses that rely on brick-and-mortar stores.
Experiences or Cash Prizes?
A very interesting statistic for these two generations is that 73% of Gen Z and Millennials value experiences over products.
And in a lot of ways this makes sense. Millennials grew up without the internet but were still young when it became commonplace. Gen Z has known nothing but the digital age and all it has to offer.
In a digital environment there is very little in terms of tangible products, being online is an experience.
It is a platform in which all experiences are just a click or two away, so you can see how this will influence the mindset of Gen Z and Millennials.
Couple that with a changing world in which they earn less than previous generations and care more about the environment and humanitarian projects, and you will see that Millennials and Gen Z are two generations that value the experience of living over their possessions. That isn’t to say they don’t value things; they just value them less than previous generations. Being able to spend time with friends, or discover new and novel experiences is more appealing to them than being able to hold something tangible in their hands.
Summary
Whilst there are some slight differences, we can see Millennials and Gen Z taking similar stances in terms of desires and spending.
They both want more ethically sourced eco-friendly products. This tells us they value ethics over most things and are willing to pay for morally sound products and services, that is, ones that don’t cause undue harm to people and/or the environment.
Secondly, both have grown up in the digital age and both are fairly happy to use brick-and-mortar stores as much as online marketplaces, however, what they use them for has changed over previous generations.
And finally, Gen Z and Millennials are both valuing experiences, what they do and see in their lives, over what they have. In an ever-increasing online world where experiences are always just a swipe away. To bring those experiences to life and offer them in person is going to be much more valuable than discounts and physical prizes.
So if you’re looking to run a competition or promotion aimed at Gen Z and Millennials, consider what experiences you can give to them, and if you want to speak to industry-leading experts, get in touch with us here at PrizeShark today and we can take care of all your prize sourcing needs.
