Learning Your ABZs

The youngest group of consumers is going to change the world. Are you ready for them?

Samantha Oller, Senior Editor/Fuels, CSP

Mitch Morrison, Vice President & Retail Executive Platform Director, Winsight

Erik J. Martin, CSP Correspondent

Illustrations by Nick Shepherd

Technology Expectations

The first fully plugged-in generation uses technology as a tool

A teenager has her face glued to her smartphone, typing away and seemingly oblivious to the world around her. It’s a common--if somewhat misleading--scene.

“The majority of Gen Z had some screen, whether a phone or something else digital, from the age of 5,” says Nancy Nessel, a Connecticut-based consultant who focuses on Gen Z. According to the CSP-Technomic survey, 85% of Gen Zers have a smartphone, while 38% have a tablet. Another oft-cited fact: Millennials grew up with three screens--a TV, laptop and desktop computers--but Gen Z is juggling five of them, with the addition of the smartphone and tablet.

While initially there was concern that Gen Z would have terrible social skills because of their tech immersion, this is proving to be unfounded, Nessel says.

“It’s given them a platform to be confident,” she says. “They are using it more as a tool, to compare prices and check on how they are doing on Instagram. They use it very pragmatically.”

And more so than earlier generations, Gen Z sees technology as a “basic amenity” in brick-and-mortar stores, according to Technomic, and an expectation for completing tasks such as ordering food.

The survey shows nearly 60% of Gen Z consumers say they are likely to use self-service checkouts, and more than half would likely use touch-screen ordering/payment systems and food-order kiosks at the pump.

Compare this to a 2014 CSP-Technomic survey that found 52% of all consumers, on average, interested in self-service checkouts, and only 47% likely to use a pump-side kiosk.

Price War

Perhaps Gen Z’s most valued tech tool is the one they carry with them everywhere: the smartphone. And they use it to control and direct their spending. You can thank their parents, Generation X, for this propensity.

“Generation X is raising Generation Z in a more pragmatic way,” Nessel says. Gen X, the first “latchkey” kids, encourage independence in their Gen Z children and tend to be more financially frugal because most of their households are dual-income or single-parent, Nessel says.

“They are not spending a ton of time with Generation Z, who tend to be more independent and less coddled than Generation Y,” she says.

It’s about striking a balance in life, says Nessel. One result of this parenting style is that Gen Z is proving to be highly practical with its money. “While they want to shop, they don’t want to pay high prices,” she says, pointing out that Gen Z likes to shop online and at discount stores such as T.J. Maxx. They are more likely than earlier generations to examine user reviews for big-ticket items.

“They take purchases very seriously, because they are so practical with their money.”

The survey reveals a few ways c-store retailers can play to this trait. Asked what would encourage them to visit c-stores more often, Gen Z picked “lower prices” (53%) as their top trigger. It’s understandable, considering most still live at home and are on a fixed income. Because of this, off ering a loyalty program that rewards customers with special offers can help Gen Zers feel as if they are getting more for their money, which in turn may spur more store visits. “Better overall value” was the second-most-selected way that c-stores could trigger more Gen Z visits.

Next: Get to Know Gen Z