Is your gift card program ready for Gen Z?
Originally published by Retail Customer Experience on February 26, 2019.
By Theresa McEndree, vice president of marketing, Blackhawk Network
Although many of those in today’s youngest generation are still in their teens, Gen Z is already being defined and most well-known for being the first true digital natives. Raised by Gen X parents who came of age in the big-hair, MTV era of the 80s, Gen Z is growing up to be optimistic yet realistic about the future, and driven to make an impact on the world. And while we may not yet be seeing the full impact of their buying power, it’s time for us as brands and marketers to start taking notice.
Gen Z is on track to become the largest generation of consumers by 2020, accounting for $29 to $143 billion in direct spending, according to Millennial Marketer. Gen Zers not only control their own spending, but the spending of their parents, grandparents and anyone else looking to shop for them. As such a large and increasingly influential group, now is the time to look at and consider the behaviors and preferences that set Gen Z apart from older generations, and keep them top of mind when implementing your 2019 gift card programs.
As we head into the new year, here are four considerations that can help you prepare your gift card programs for the youngest generation of shoppers.
Maintain both a strong in-store and online presence
Even with record growth in e-commerce and digital gifting, the demand for physical gift cards and in-store experiences is still strong, and in many cases preferred — especially among Gen Z. According to a recent survey by Profitect, 42 percent of Gen Z shoppers like shopping in-store versus online and just 23 percent of those surveyed preferred an online only experience. With today’s rapid improvements in technology, there is no reason why you shouldn’t be able to maintain an omnichannel experience that allows your consumers to seamlessly move from one channel to the next.
Embrace digital gift card options
Look to integrate gift cards, loyalty and reward programs into digital wallets, or at the very least, online. As digital natives, Gen Zers have grown up with social media and smartphones as an integral part of their lives. They now have the option to store, manage and make payments with gift cards all from their digital wallet. If your brand is digitally connected to your consumers, you will be able to quickly and easily engage Gen Zers whenever and wherever they are.
Make it personal
Gen Z has grown up expecting a personalized experience in most facets of their life — shopping included. According to a study by the National Retail Federation, 54 percent of Gen Zers value a personalized shopping experience. Gift cards — egifts in particular — are an increasingly popular tool that can be customized in a variety of ways to keep retailer’s brand and messaging front and center while providing consumers with an enjoyable, personalized experience. And, when it comes to purchasing egifts to give, there are also numerous opportunities to provide customization options, including photo, video or written messages with minimal added time, cost or effort. Digital gift card innovations like product egifting have even given Gen Zers the ability to send or receive physical products via email without needing to know the recipient’s size, style preference or shipping address.
Offer extra rewards and loyalty points for gift cards
With many of the oldest Gen Zers currently being in college, they have learned to be innovative and thrifty. Gift cards are an effective way to stay on budget and cash in on special promotions, and savvy Gen Zers will likely be on the lookout for promotions that include extra reward and loyalty points for purchasing gift cards. Particularly around high traffic times, you can stay top of mind for Gen Z consumers and ensure return visits to physical or online stores by offering extra gift card freebies or incentives on higher dollar gift card purchases.
With mass appeal, gift cards offer a wide range of options — physical, digital and mobile. As Gen Z continues to become a retail force to be reckoned with and gift card purchasing continues to evolve, embrace the shift and consider expanding into new ways to help attract the youngest generation while maintaining engaged relationships with older shoppers.