There’s a common saying amongst younger generations that they ‘don’t like labels’ and don’t want to be defined as belonging to any particular group. Yet long-term changes to technology, retail, and popular culture still have far-reaching effects on the habits and preferences of consumers as they age. This is why demographic cohorts like Millennials and Generation Z still hold value when it comes to determining how different generation groups want to interact with brands.
Millennials, less commonly known as Generation Y, came of age in a time that straddled great technological changes. This group paved the way for Generation Z’s (also known as Gen Z’s) pervasive use of digital technology and social networking apps.
Millennials and Gen Z are often talked about interchangeably within popular media. Before we begin examining these groups, it’s important to define the date ranges that apply.
Generally speaking, Millennials were born from the early 1980s to the mid-1990s. The Millennial generation is typically defined by researchers and media outlets as people born between 1981 and 1996.i
Gen Z, the first true generation of digital natives, was born starting in the mid-to-late 1990s, with the cut-off period cited as the early 2010.ii
Next, let’s look into the state of mind of each group. Extensive ethnographic research conducted on behalf of McKinsey & Company in Brazil found that Millennials are globalists in their outlook, questioning, and oriented to self. This group consumes experiences, and other research suggests that Millennials are also idealistic and health-conscious.
Gen Zers, on the other hand, who tend to define themselves in many ways, are “communaholic” (radically inclusive), want to have fewer confrontations and more dialogue, and are pragmatic. This group is concerned with searching for truth.iii
In today’s digital age which favors online experiences, the differences between Millennials and Gen Z groups may be more subtle than consumer buying behaviors and shopping habits. Both generational groups are steeped in digital. Gen Z is more connected to video-based social media platforms such as Instagram and TikTok than older age groups.
Gen Z is also considered less brand loyal than its Millennial counterparts. According to a Harris Poll on behalf of Sprout Social that surveyed over 1,000 U.S. adults, approximately 75% of Gen Z consumers look to social media to interact with and learn about new brands. They want brands and companies to examine their social posts, and they want two-way interactions with relevant conversations.iv
Perhaps surprisingly, the same survey, found that Millennials were faster adopters of social commerce (buying or selling directly via a social platform) than Gen Zers. Millennials often use social media to express love for a product or service—the most out of any age group. They are also likely to use social media to reach a brand’s customer service department by sending a Direct Message (DM) or posting publicly.
Here’s a bigger round-up on Millennial and Gen Z shopping behavior based on recent research:
An online survey by Rightpoint conducted with 1,025 U.S. adults aged 25-64 found that on average, 85% of consumers are more likely to notice a frustrating brand experience than a seamless one. Gen Zers are the most likely to notice a suboptimal brand experience, followed by Millennials at 87% and 86%, respectively.v
McKinsey & Company found that consumers overall are tolerant of brands when they make mistakes—if the mistakes are corrected. In particular, Gen Zers are more tolerant of these mistakes, congruent with their focus on inclusivity.vi
A survey on behalf of LaserShip to more than 1,000 online shoppers found that Millennials and Gen Z shoppers are up to three times more likely to want and pay for expedited shipping, compared with older age groups. Many of these younger cohorts want free shipping and have abandoned a shopping cart due to high shipping costs. One-third of those surveyed by LaserShip rank fast delivery as the most important consideration when shopping online, and 63% expect their items to be delivered within three days.vii
Despite the digital immersion that Gen Zers were raised in, almost everyone appreciates the human touch. The earlier noted Rightpoint study found: “Despite brand investments in digital functionality and personalization, it’s still those moments of human interaction that go farthest in creating a feeling of being valued and respected as a customer.”
Ways to reach a customer’s heart include friendly and competent interactions with customer service, and clarity on how to connect with a customer service representative. Live chats and personal outreach are important to give customers a feeling of personalized service.viii
These more personal interactions with people on the other end of the phone, aisle, customer-service counter, or digital experience encourage lasting customer relationships, supporting higher levels of customer loyalty.
While the mindsets of Millennials versus Gen Z can differ widely as consumer shopping shifts further toward digital touchpoints, perhaps there’s less variation in behavior across these age groups than meets the eye.
i “Generation next, Millennials will outnumber baby-boomers in 2019,” Rauch, Jonathan, The Economist, November 2018.
ii Could Gen Z Free the World From Email?,” June, Sophia, New York Times. July 10, 2021, https://ghostarchive.org/archive/mB44m
iii “True Gen: Generation Z and its implications for companies,” Francis, T., Hoefel, F., McKinsey & Company, November 12, 2018. https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/true-gen-generation-z-and-its-implications-for-companies
iv “How Different Generations Use Social Media—and What this Means for Your Business,” Sprout Social. https://sproutsocial.com/insights/guides/social-media-use-by-generation/
v “High Tech with a Human Touch: The Role of Real People within Digital Experiences.” Rightpoint, 2022. http://go.rightpoint.com/e/141911/ech-with-a-Human-Touch-Dec-pdf/b33x94/638114712?h=HaDvgzkt2hrR2Kg75siyZTlJvcQ1nKTjzW-wLWM9e9k
vi “True Gen: Generation Z and its implications for companies,” Francis, T., Hoefel, F., McKinsey & Company, November 12, 2018. https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/true-gen-generation-z-and-its-implications-for-companies
vii “Millennials and Gen Z Are Up to Three Times More Likely to Pay for Expedited Shipping, According to LaserShip’s E-Commerce Shipping Survey, Conducted by Hanover Research,” Cision PR Web, January 14, 2019. https://bit.ly/3HBjg0j
viii“High Tech with a Human Touch: The Role of Real People within Digital Experiences.” Rightpoint, 2022. http://go.rightpoint.com/e/141911/ech-with-a-Human-Touch-Dec-pdf/b33x94/638114712?h=HaDvgzkt2hrR2Kg75siyZTlJvcQ1nKTjzW-wLWM9e9k