Gen Z Overload & Reality Check
As 2022 wraps and 2023 kicks off, there has been an uptick in conversations about Gen Z spending. I get it, it's the same in my house, as by 10 and 13 year old beg for increasingly expensive Christmas gifts, get involved in increasingly expensive school projects and extracurriculars. But the news in the media, and you know who you are, is increasingly focused on the spending of Gen Z. Those of us outside the media that are more self-aware understand that this is a whats-the-new-shiny-thing marketing tactic. But as with all of these types of posts, the Gen Z-Are-The-Most-Improtant-Thing-You-Need-To-Focus-Your-Business-On, is nothing more than fluff.
Most of the Gen Z articles you see focus on potential, not actual, power of this generation. They'll admit very quickly admit in the first 2 sentences of the second paragraph that giving, spending, political power, etc. of Boomers, Gen X and Millennials dominates the country and the world. But then they'll spend 7 paragraphs talking about the The Great Young Hope. They paint a picture that is very attractive to brands. Go ahead and check. Google "Gen Z" and check out the images. They mostly look like this, young adults incredibly eager to buy your stuff and set new trends with it by trending it on Tik Tok:
What they don't show is the reality of Gen Z, like these two goobers:
These are my sons (and their Gen A sister's giant foot). They do not have money. They have MY money. They can't vote. They don't own a car, in fact their transportation is limited to walking, biking or their father driving them to endless sports, music and art activities. They don't have credit cards. The big one is just recently sneaking onto social media behind my back (or so he thinks). The only donating they're doing is when a flyer comes home from school and I did through the pantry or rush out to the grocery store for non-perishables. They don't have personal income because they don't have jobs. In fact, they don't even wash their own clothes.
The reality of Gen Z is that 50% of them are under 18, jobless, living at home. I've made this handy chart for you to reference anytime your marketing team starts Power Pointing all over your walls about engaging with Gen Z:
领英推荐
Gen Z spans 10-25 years old. Half aren't old enough to work besides the few entrepreneurial types mowing lawns and bagging groceries. And believe me, they're not spending in with your brand unless you run Fortnite or American Doll. Even worse, as 62.5% (and growing) of them are attending college, employment is coming even later. Only 4 years out of 16 have a significant percentage working full time. And those that do are already $30,000 in debt. Those who are increasingly pursuing masters and PhD degrees are entering the workforce 2+ years later with debt reaching $80-132,000.
This debt, combined with their age and limited work history or credit means their spending power is very little, especially when compared to Millennials, Gen X and Boomers.
What does this mean? Most of this audience is children with little to no spending power. The older segment that are making purchasing decisions are too in debt with what used to be discretionary income their Boomer grandparents had instead going to Big Banks to pay off the job training that used to be provided by employers. They don't even quite reach the same level of spending power as grandma has. And she doesn't have college debt, but she has all day to watch QVC and shop.
But just look at the difference in how Gen Z is treated just on LinkedIn. Here are the current popular hashtags by generation:
Instead of endlessly chasing this new generation that simply has no money (we saw you doing it with Millennials to, don't think we didn't), consider the high spending audiences that may not be as sexy, but sure as hell have more money: Boomers, Gen X and Millennials. The peak marketing demographic isn't 18-25. Yeah, they may be trend setters, but only among their broke-ass friends. The peak marketing age is 35-55. They've gotten their loans under control. They've climbed the financial ladder. They're buying new homes, getting married (again), having kids, buying crap for their kids, buying new cars, going on vacation, buying new appliances, getting into hobbies, buying new dad shoes and workout gear to wear to PT meetings. In fact, this demographic isn't just buying clothes for themselves like older Gen Zers, they're buying clothes for themselves, their spouses, and 1-3 kids. So maybe instead of chasing the next shiny thing, focus on the thing that has the spending power now? Or not.