Three Things Companies Should Consider When Targeting Gen Z

29 04 2023

Photo: Getty Images

By David Herpers, Forbes Councils Member via • Reposted: April 29, 2023

As Generation Z begins to harness its buying power and make significant financial decisions, competition for its attention grows. For companies hoping to capture this generation’s business, it’s important to understand the way they view their finances and how they engage with a brand. While Gen Z’s relationship with money and brands is similar to that of its older siblings, millennials, it’s certainly not the same. Let’s look at how Gen Z approaches finances and consumer brands.

Money Habits

As with the members of any younger generation, we tend to expect Gen Z to have irresponsible spending habits and not to be the biggest savers. Studies show this isn’t the case.

Gen Z tends to spend less and save more than the other generations, contributing an average of $867 in savings per month, almost doubling what the average American saves each month ($462). One may find themselves asking, is Gen Z more fiscally responsible than the rest of us?

The answer is yes and no. One main factor leading to the high monthly average of savings is many Gen Zers still live at home. According to a 2022 study by Credit Karma, Gen Z is setting records for the number of people living with their parents following high school education. With costs of living at an all-time high, most Gen Zers are making the decision to stay home in the best interest of their short- and long-term financial security.

That said, there’s still a large portion of Gen Z that chooses to spend over saving. However, those that fall into the spending category are still taking a cautious approach. Over 68% of Gen Zers use a budgeting tool of some sort to manage their finances. Of those surveyed, 43% say they prefer the old-fashioned pen-and-paper method, while 38%, respectively, say they use online budgeting tools.

Brand Enthusiasm

Gen Zers’ cautious nature isn’t exclusive to their housing and higher costs. It extends to their relationships with brands as well. When looking at the relationship between Gen Z and brands, a recent IBM study measured brand loyalty (repeated purchases) and brand enthusiasm (active engagement between brands and customers).

According to the IBM study, Gen Z is more likely to display brand enthusiasm over brand loyalty. Known as the “generation of researchers,” this is likely due to Gen Z’s habit of turning to online platforms for reviews before making even small purchases.

Rather than committing to a brand they are familiar with, Gen Zers will evaluate all options, taking into consideration customer and influencer reviews, social media presence and value alignment. When they find a brand that checks all their boxes, they are eager to share and engage with it. But keep in mind, should the brand harm the relationship in some way, Gen Zers quickly move to purchase from a competitor.

An advantage of appealing to brand enthusiasm, as noted by IBM, is that it creates opportunities to gain insight into customers’ attitudes and purchasing habits in relation to a brand. Companies get to have conversations with customers about what they want rather than guessing. And we already have insight into what Gen Z customers crave.


While millennials may stray away from content that’s been highly edited and airbrushed and that poses perfect “promises,” Gen Z has taken it to the next level—by adeptly recognizing the differences between real and fake online content. As the first generation born into social media and becoming more tech-savvy than generations so far, Gen Z is quick to identify fantasy versus reality. According to IBM’s study of Gen Z’s relationships with brands, it’s clear this generation places a high value on a brand’s authenticity and prefers real content over staged content.

The concept of authenticity extends beyond advertising and product images for Gen Z; it includes the company’s impact. According to a 2019 Kearney study, 57% of Gen Z reports a brand’s social and environmental impacts are key factors in its purchasing decision. But a statement about a brand’s commitment isn’t enough to sway the generation of researchers. In fact, Gen Z will go out of its way to find—and even pay slightly more for—a product or service if it means the purchase aligns with its values.

As Gen Z’s influence on the market and society continues to grow, companies and brands can best position themselves for success by aligning with the values and habits of this generation. With a large number of consumers that can take the success of a brand into their own hands, keep in mind their financial concerns, engagement expectations and craving for authentic content, as these are likely essential to keep a brand afloat in the rise of this new generation.

David Herpers is the SVP of Digital Bank at Credit One Bank. His expertise includes wealth management, banking and product management.

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