Each generation of people has its spectrum of quirks, behaviors, and beliefs that leave a mark on the world for years to come.
There are two generations, in particular, who are changing the landscape of the retail sector. We call these digital natives "Generation Impact."
This generation tends to be the most generous and conscious with how they spend their money. As a result, they make up today's modern consumer population—and they’re the people who dictate current and future trends.
So what does this mean for ecommerce brands?
This article explores how brands can approach ecommerce for Generation Impact based on their unique shopping habits and behavior. Let's dive in.
Millennials and their need for radical change
The generation that embodies dynamic change best is Millennials.
To understand why Millennials are so keen on change, you have to look back in time. Each generation creates a ripple effect resulting in the different viewpoints and values exhibited by the generation that comes after.
Passion fuels millennials, which stems from being exposed to various counts of racial and gender inequality, drastic climate changes, and recessions. These life experiences have molded a generation that is hyper-focused on racial equality, fair wages, sustainability, and eco-friendliness.
Millennials may have been dubbed as the "Me Me Me Generation" by Time Magazine, but social generation experts Neil Howe and William Stauss have a different term—the "found" generation.
They predicted that Millennials wouldn't channel their strength on destroying old institutions that have failed, but would instead focus on building more effective alternatives.
They were right. Millennials are socially responsible and fight for diversity and inclusion. Having access to technology but not born into it, they prioritize experiences over worldly possessions. That's why you're likely to see travel pictures on most of these young adults' social media accounts instead of expensive branded products.
As consumers, they don't easily fall into marketing traps and rely more on word-of-mouth and online reviews. A whopping 83% of millennials want companies to share their values.
Brand authenticity matters, and retailers can only tap their attention by forming relationships and sharing their sentiments and insights.
Gen Z and Their Need for Social Justice
Millennials are not the only ones looking to make an impact. The post-millennial cohort known as Gen Z followed Millennials’ lead in terms of social issues, but they have a voice of their own.
Being the first set of digital natives—meaning they grew up with technology—they are tech-savvier and have embraced social media as a massive part of their daily lives. They are progressive and have intensified everything that millennials have stood for—independence, pragmatism, social and environmental awareness, and diversity.
These values represent Gen Z's shopping decisions more than anything else. In fact, they willingly spend more on products from eco-friendly brands and other businesses that nourish their identity and beliefs. Surveys show that 73% don't mind paying extra for sustainability; a large number were even ready to shell out a 10% premium for it.
Moreover, they too look to influencers and peers, giving more merit to recommendations and reviews they see online than TV commercials.
Laura Wittig, CEO of eco-friendly site Brightly, believes that Generation Impact is looking for shopping experiences that mirror their values and interests, saying:
“Sustainability and eco-friendly focused brands are winning in terms of customer acquisition and retention, and shops that further differentiate the experience through community, UGC, and other interactive features are places where Gen Z wants to shop and support.”
The power of direct-to-consumer (DTC) methodology for Generation Impact
As you can tell already, connection is a key ingredient to winning customers within the Generation Impact segment. The DTC approach aids this by connecting brands directly with customers (no middleman required.)
When done correctly, DTC selling checks the box of brand transparency in every way—from the website to the in-store shopping experience—which is critical for conscious consumers, who prefer interacting with a brand directly over buying from a larger marketplace like Amazon.
That doesn’t eliminate the option to launch physical retail stores, however, as these are another path to direct consumer interaction and relationship-building.
Many digital-first DTC businesses are now launching brick-and-mortar stores.
Some DTC businesses open physical stores that function as a showroom more than a place of transaction. Stores are used to put the products in front of the customers while establishing trust. It’s more about building brand awareness than generating revenue right off the bat.
One example of this is Neighborhood Goods. They provide a home for contemporary and eco-friendly brands as well as thoughtful events. Dubbed the “new face of department stores,” they breathe a new life to physical retail by curating a whole new shopping experience for conscious consumers.
Another example: Glossier. This DTC beauty brand has a flagship store in New York and another one in Los Angeles (although they have closed down temporarily since the onset of the COVID-19 pandemic).
Glossier climbed the ladder of success by crafting a personal connection with their customers. They formed a community online. But they didn’t stop there.
This bond was then translated to their retail spaces. Staying true to their brand, Glossier’s physical stores are designed to give its community a way to interact and form deeper connections with the brand while interacting with the product in person and getting support from in-store staff.
The power of loyalty for purpose-driven brands
DTC isn’t the only power play for ecommerce brands wanting to connect with Generation Impact, however. Promoting the company’s mission and values is another way to reinforce goals and drive customer loyalty.
A few brands that do this well:
- CocoKind is a conscious cosmetic brand with cruelty-free and plant-powered products. Even more impressive is their impact foundation aimed at providing financial grants to women entrepreneurs focusing on wellness, health, and sustainability.
- Your Parade promotes eco-friendly undergarments and encourages inclusivity and body positivity.
- Thousand Fell is known for creating recyclable sneakers. The company uses sustainable and durable materials such as coconut husks and sugar cane.
This matters because Millennials value companies who represent their values and beliefs, while Gen Z urges companies to stand up for societal issues.
Data reinforces this, too:
- The same data set showed 66% would willingly switch to products from a purpose-driven company, dropping products they've used for years.
- According to one study, 77% of Americans favor and support purpose-driven brands rather than well-known ones.
- Due to Covid-19, 36% of Americans proved that loyalties can shift at any time. People are more open to switching to different products from what they’re used to if it means supporting brands advocating for social issues.
Incentivize your customers to give
So what can brands do to act on this information?
Brands can serve as role models to inspire more conscious consumption.
One example of this can be seen with The Blind Barber, which created a loyalty program that boosted brand loyalty by enabling customers to give to causes they care about.
Thanks to the integration, shoppers can award points for every dollar donated. It also allows for points redemption so shoppers can make donations whenever and wherever they please.
Conscious consumer trends that are here to stay
What else do you need to know about Generation Impact? Let's look at a few trends emerging around conscious consumers.
1. Deepening customer bonds through omnichannel sales
Having multiple sales channels (both online and off) is more important than ever.
In fact, 68% of Millennial shoppers insist on brands having both physical retail stores and online availability to make their shopping journeys more unified and straightforward. By having this customer engagement strategy, brands also shrink the gap between shopping online and offline, thus forging deeper customer relationships.
When executed well, a brand’s retail presence builds tactile, memorables experiences around their core values, thus deepening the shoppers experience. Consumer Psychologist Kate Nightingale said:
“Retail spaces are designed for the conscious consumer mind, but it is the subconscious mind that makes the decisions. The subconscious only picks up small sensory details, but they profoundly impact a customer's shopping experience. Each sense should be accounted for across retail experiences.”
Leather bag company Parker Clay has pulled this off well. When you walk into their shop in Santa Barbara, you instantly feel that each piece in the store has a special story (and indeed, they do.)
All of their items are handmade by Ethiopian women artisans who would otherwise be a victim of injustice and abuse in their country. This focus is reinforced through signage, tags, and in-store education.
2. Educating customers
Educating customers about your brand and products is a smart play when targeting customers within the Generation Impact category.
In April 2021, the company also rolled out a new app, in which shoppers can use for placing orders, reserving their favorite items, and discovering new offers and collections. It’s also a great way to make their customer education efforts more accessible and puts that information where their customers spend the most time: on their smartphones.
3. Establishing brand transparency and value alignment
Both Gen Z and Millennials are careful about which brands they support. These generations are looking for a connection that goes beyond mere products or services—they want to connect with brands who resonate with their ethics.
Outdoor furniture brand Outer forges connections with its audience by talking about the importance of making great memories outdoors, having a community with shared values, and living responsibly.
That's why understanding who your customers are and what their values are is so important: so you can tailor your approach accordingly.
However, this can be a slippery slope. If your brand doesn't genuinely share the values it preaches, that can come off as phony or disingenuous. Establish company values (if you don't already) and focus on finding customers who align with those values.
Social impact-driven ecommerce solutions for Generation Impact
The following strategies are effective in encouraging ethical and sustainable shopping that conscious shoppers can hold in high regard:
- Reasonable shipping
- Observing fair trade
- Carbon off-setting in manufacturing
Let's take a look at each in more detail.
1. Responsible shipping
Due to the instant gratification technology has cultivated, younger generations tend to be impatient when ordering things online. They want their packages to be at their doorstep the next day—or sooner.
Thanks to giants like Amazon offering ultra-fast shipping, brands are forced to include one-day shipping options in an attempt to compete, but it's important to ask: Is this practice environmentally sustainable?
In Going Green: Sustainability in eCommerce webinar, Clemmie Pierce Martin of Goodfair suggests educating your consumers first about the repercussions of fast delivery. Give your buyers the chance to realize if it's a worthy trade-off for convenience.
If you explain that you're looking for more sustainable shipping routes, it will resonate with those who care about this kind of impact. Customers won't see a three to five-day waiting period as an inconvenience.
Another way is to leverage automation so consumers feel involved through the whole process. Get in touch with them and send consistent updates to let them know you haven't abandoned them. Many times, it's the lack of transparency that puts these customers off, not the waiting game.
This witty example of an order confirmation email from MeUndies shows you how this can be executed:
2. Carbon off-setting in product manufacturing
Did you know that cotton farming accounts for 24% of insecticide use and 11% of pesticide use? Or that manufacturing processes, such as dyeing and finishing, fabric and yarn preparation, and fiber production, make up 90% of the textile pollution?
In other words, the textile industry plays a huge role in greenhouse emission production.
Some DTC brands practice sourcing materials from ethical suppliers and manufacturing products by hand. But not all brands can afford this. It's wise to look for other ways to reduce waste in your business.
For instance, reducing your packaging or opting for recycled materials is a good place to start. But there's no need to overthink it; Millennials and Gen Z-ers will appreciate simple and sustainable packaging from eco-friendly brands, such as Lumi.
3. Fair trade
Despite the emergence of conscious consumers, it's still hard for ecommerce stores to market fair trade goods simply because of their more expensive price tags.
Brands should call attention to the advantages of purchasing artisan products if they want modern shoppers to jump on board. Companies like Known Supply, for example, give a face to the people creating the product so that buyers give importance to the story and value of every piece.
Consumers want to know where their products are coming from and how they're made. Brands will be held to a higher standard to treat their workers fairly and be mindful of the impact their business has on the environment.
4. Donation-based shopping
Charitable, modern shoppers are more than willing to make a purchase if it's for a cause that's close to their heart. Ecommerce and DTC brands can partner with charitable institutions to make this easy for consumers.
One of the most common strategies is creating specific products and donating all the proceeds to their chosen organization. Just remember that when choosing a non-profit partner, you should stick to a cause close to your brand and what it stands for.
You can also get creative and personalize your approach according to your customer’s preference. Platforms like ShoppingGives allow shoppers to choose where to donate.
Embrace Generation Impact
These days, shoppers are inclined to participate in a cause from the comforts of their own home.
Generation Impact wants to contribute to the world's greater good, and retailers have a unique opportunity to facilitate this type of action. When done right, it often works out well for brands in terms of revenue and brand loyalty, but only if they do their research, put in work, and remain genuine with their cause.