Gillian MacPherson explains key findings from our cross-generational research.
After wrapping up extensive research across the generations—Age matters: A guide to cross-generational marketing, which outlines similarities and differences in how the generations spend, their preferences and how to market to them effectively—it became clear that there’s much more to say on the topic than could possibly fit into the report.
We sat down with Gillian MacPherson, VP Product, to talk about why everyone should care about cross-generational marketing, what finding was the most shocking and how to put the research into action.
AEG: What if my brand focuses on one target generation—why should I care about the other generations or cross-generational marketing?
GM: How could any business only work with one generation? I doubt that anyone truly does.
With that said, even if you have one generation as your primary consumer, they can be influenced by other generations if they are exposed to them and live with them. The report shows how generations influence each other, especially how Generation Z impacts older generations. So even if you talk primarily to baby boomers, for example, having a Gen Zer in the household could impact how you want to talk to those boomers. That finding focuses on how Gen Z influence older generations, but there’s no reason to believe there’s not an inverse that isn’t addressed in the research.
AEG: After reviewing the findings, what was the biggest surprise?
GM: A few findings about Gen X were unexpected, like how much buying power they have, how tech savvy they are (especially if they have Gen Z kids) and the overall lack of conversation around Gen X … they aren’t really discussed at all.
[Editor’s note: After this interview, CBS had this snafu, leaving Gen X off of a generations graphic.]
Everyone likes to talk about the new thing—Gen Z in this case—but let’s not forget that Gen Xers and boomers have major spend. Why aren’t we focusing on that? It’s a bit of a miss.
Another surprise was the importance of ratings and reviews. ‘Ratings and reviews’ got a higher ranking than ‘opinion from friends and family’ in some of the generations for whom they trust to inform purchase decisions. I’ve never seen this before in any research we’ve done. I think this speaks to the prevalence of reviews, like on Amazon. People have become more conditioned to look at ratings and reviews and there’s a quantity, so they feel some validity and credibility around the rating.
It was also interesting to show that Gen Z could impact up to boomers and extend that far into older generations. The research showed that regardless of age, whether they are parents or grandparents, they also are influencing older generations.
AEG: Can you talk more about what you mean by Gen Z influencing older generations?
GM: Influence is around education and exposure. If a Gen Zer is in the household, they both educate and expose their parents or grandparents around their way of life. For example, my Gen Z daughter uses her phone to communicate with friends and Snap and Instagram all the time to understand influencers and trends. Because of her, I have much higher awareness of how that phone can be used and how Instagram can be used. I wouldn’t have this understanding if she wasn’t in the house. She definitely influences how I think about how impactful a medium or channel could be.
AEG: Speaking of Gen Z, the research says that Gen Z like to shop in-store—that must be incorrect?!
GM: With all the talk of death of retail, the findings that Gen Z like to shop in-store were interesting, but the reasons make sense. For Gen Z, shopping in stores is about convenience and socializing. They are impatient, so if they’re going out that night and want something to wear, they use the store. 24-hour shipping is great, but it’s still not immediate and not the same as going in and trying on items. Touch and feel are important for many people. The other element is time and the desire for the social element of shopping. With friends, they can try it on, have quick opinions and then wear it out that night.
The research also shows that younger generations are more loyal to brands than to retailers. What we found was that younger generations want to be wearing the thing that’s ‘in’. So they will go to Nike or Adidas or whatever brand is popular. As you age, you’re looking for efficiency, speed of shopping and pricing so are more interested in retailers that have the brands you like.
AEG: Now I’m sure you had hypotheses to start the research, what was the biggest assumption that was validated?
GM: We assumed that younger generations in a household, specifically their thinking and adoption of tech, would filter through to their parents. And we definitely saw that.
The other assumption was around how generations use their phones—and the camera in particular. It was interesting to clearly see how the different generations use phones. The younger you are, the more the phone has become so intrinsic and multi-purpose.
Younger generations take pictures of recipes and parking spots, take selfies and research products they like, but also manage medications and loyalty cards. Older generations mostly use the phone to make calls and take traditional photos. The mobile phone and camera may become part of marketing moving forward.
AEG: The survey portion of the research asked people about privacy. What did that question uncover?
GM: It was interesting to see how millennials and Gen Xers are becoming so much more privacy-aware and even more so if they have children.
We continue to see people focusing on the utility and benefits they get from being online, versus their concern about privacy. People don’t seem to be leaving platforms in droves, but the data does show that older people are more concerned. As privacy continues to be in the news, it’ll be interesting to see if consumers become more cautious or whether marketers need to do a better job of communicating the benefits.
We’re seeing a balance between personalization and unique experiences versus having too much data about me. And what’s that balance? And how can that be transparent and valuable to the consumer? It’s about a fair value exchange in a consumer’s mind; it has to be transparent and seen as valuable, and then it becomes a positive relationship for both.
AEG: Now, to put the research into action, what advice do you have for preparing your brand for the future? Do you recommend adapting to Gen Z’s preferences?
GM: I think two key things come through.
One: the generations do influence each other. So, if you have a core age group that is your primary customer group, recognize that if there are younger people in the house, they may be more tech advanced. As an example, boomers still favor traditional TV, but millennials favor streaming. Gen Xers are in the middle, they prefer streaming if they have kids but TV if they don’t. Be sure to take a look at everyone in the house and see if that have any impact on your marketing plan.
Two: each generation has its own preferences and nuances. Millennials are more of a “me” generation, but Gen Zers seem to be more altruistic and care about a brand’s affiliation with causes. However, as each generation ages, certain milestones and life stages are consistent in impacting spending behavior. With growing careers, buying homes and having families, we see younger generations care about similar things as the previous generations.
It’s the same that we saw with our millennials research: don’t forget that as they age—there’s generational differences for sure—but there are also life stages that are consistent and behavior mirrors that stage.
With millennials, once they improved jobs, got married and had kids, their behavior wasn’t as different as one thought. They actually spent and behaved more like older generations because of their life stage. As people age, some things will stay the same (in terms of needs and expectations). According to our research, the life stage is equally as important as generation.
And part of moving through life stages is that eventually, we have more solid careers and make more money. Don’t forget about the impressive spending power of Gen X and the boomers.
So instead of always trying to adapt to the next generation and focusing on what makes them unique, first look at your primary customers and what you need to know about them. Trying to attract new generations is important, but you can’t forget your core. You need to first really understand who your customer is (perceived vs. actual consumers). Then, who is your next best prospect?
AEG: Finally, one of the takeaways from the report was to capitalize on those Gen Z who are spending now. How can brands do better at that?
GM: Well, Epsilon has access to the most transactional data for marketing purposes. We are able to identify consumers who have and are spending—or those with the highest potential for your brand—and can help reach them in any channel.
In addition, with household demographic data, we can identify these young Gen Zers – whether they are under 18. Marketers should focus on the parents who may actually make the transaction but are influenced by their children. Or older Gen Zers who have their first jobs and have their own money to spend.
To learn more about the findings and how to adjust your marketing strategies to effectively reach across generations, download the full report.