Winning the hearts and minds of Gen Z through AI

Artificial intelligence (AI) is fast becoming an essential tool for every organisation globally. Using AI to fully map the customer journey helps businesses understand what drives purchases, the expectations of different demographics and how customers perceive brands.

With the proliferation and rapid development of technological devices such as smartphones and media tablets, brands are trying to gain actionable insights about Gen Z and win their hearts & minds for success. Keeping pace with the needs of brands, at GfK, we are transforming from a classical marketing intelligence firm into an AI-powered data analytics and consulting company to provide the predictive insights companies need in these unusual times. 

Gen Z is one of the most dynamic consumer groups today, we define this generation as those born between 1998 and 2012, currently aged 9 to 23 years in 2021. They are in a life stage punctuated by many key events related to work and family, which in turn has implications for their consumer behaviour. According to the GfK Consumer Life Report 2021, nearly half of Gen Z consumers in APAC play video games on their smartphone/tablet daily. They are in the process of forming their adult identities, which has implications for the way they conduct themselves as participants in local, national and global communities. 

Given the evolving consumer landscape, brands must see their customers in three dimensions (3D customers). This means combining insights that tell us what people are doing (quantitative and sales data), why they are doing it (qualitative and attitudinal data) and identifying all the major influences that also impact people’s purchasing decisions (personal values, income, life stage, lifestyle, etc.). Keeping pace with these market needs, AI-powered platforms offer enterprise-grade insights with consumer-grade usability and help brands save 30 per cent of time spent on root cause analyses, plan promotions with just 2 clicks and understand brand uplift in seconds.

As customers pivot from brick and mortar stores to online platforms, artificial intelligence (AI) predictive insights enable retailers to retain customers by utilising chatbots to rectify problems faster and to reduce expenses. AI also assists in creating customised initiatives to propel sales and provide enlightenment on the effectiveness of marketing strategies, while progressively mobilising channels to enhance recommendations and personalisations for customers, thereby facilitating a seamless and enjoyable e-shopping experience while satiating the instant gratification of Gen Zers.      

As a personification of the future of augmented reality, the metaverse will be facilitated and further driven with AI. A noteworthy application of AI in relation to the metaverse is interface optimisation. Digitally savvy Gen Zers will be able to communicate with machines on a more natural level as their gesture recognition capabilities are enhanced, heightening their comprehension and deciphering of human emotion and body language. With advanced eye tracking technology, AI is utilised to foresee where human eyes will look at next, providing an immersive experience. This added feature would be most useful in ascertaining what shoppers are keen in during the interactive purchasing exchange.         

Concerning the brands that they prefer and purchase, Gen Zers are “truth seekers” who possess a close and intimate sense of trust with enterprises and brands that operate based on either their individual beliefs or society’s best interests. According to the GfK Consumer Life Report, more than half of Gen Z consumers in APAC agrees that “it is important that companies take environmentally responsible actions, such as using environmentally friendly materials or ingredients.” 

Brands and nations that maximise the rise of AI would reap numerous gains in forming sustainable economies, as a joint study by Microsoft and PwC attests. Developing markets and brands would benefit on the aspects of productivity and sustainability upon embarking on AI led initiatives, which could eventually assist them in making strides towards their more developed competitors.       

Being digital natives, Gen Zers are extremely comfortable incorporating the Internet into their daily lives, with all the conveniences and smart features that it brings. Leaving an electronic footprint embedded with considerable amounts of personal information and purchasing preferences, this leads to issues pertaining to privacy and data leakage. Ethical AI integrates the involvement and observes the impact towards customers with an amalgamation of support from senior leadership and cross functional collaboration. Brands that adopt such a strategy will be able to identify potential risks and develop competent technological innovations, while being perceived with integrity by their customers.         

In terms of mindset, it is interesting to note that traditional gender roles rank last among Gen Z’s personal values across both developed and developing nations in Asia, which gives rise to gender-neutral or genderless products and marketing in a host of categories. It is crucial for enterprises and brands to be inclusive and engage the Gen Z customer at every stage of the purchase lifecycle. Therefore, sales and marketing solutions are required to be data-driven with predictive insights to offer unique, personalised and targeted experiences in the digital-first world.