How new generations interact with brands online

Online experiences are increasingly capturing consumers’ attention, especially among the younger generations, according to the Deloitte Digital Media Trends 2023 report, which was conducted on over 2,000 US consumers. Half of Generation Z and Millennials believe that online experiences are meaningful substitutes for in-person ones and say they spend more time interacting with others on social media than in the physical world. At the same time, only 20% of Generation X, Baby Boomers, and Matures share the same opinion and behaviour.

By Romanita Oprea

Immersion and community are big draws to a wide range of entertainment activities. The top three favourite digital entertainment activities for consumers are watching TV shows or movies (30% of Generation Z and Millennials; 55% of Generation X, Baby Boomers, and Matures), listening to music (26% of Generation Z and Millennials; 22% of Generation X, Baby Boomers, and Matures) and watching user-generated content (19% of Generation Z and Millennials; 6% of Generation X, Baby Boomers, and Matures). The ranking of activities is completed by playing video games (19% of Generation Z and Millennials; 6% of Generation X, Baby Boomers, and Matures) and listening to podcasts (4% of Generation Z and Millennials; 2% of Generation X, Baby Boomers, and Matures).Younger generations turn to different kinds of digital activities to meet their need for social connection, the report suggests.

Generation Z and Millennials feel most connected to a community while watching user-generated content (27%), playing video games (19%), watching TV shows or movies (18%), and listening to music (17%) or to podcasts (10%). In contrast, 45% of Generation X, Baby Boomers, and Matures say they do not feel socially connected while performing these activities. Gen Zs and Millennials churn—and return— through paid SVOD services at higher rates than older generations. 88% have a paid SVOD subscription in the household, while 44% of the respondents have cancelled a paid SVOD service in the last 6 months. Moreover, the study shows that the economy is having a noticeable impact on entertainment subscriptions, especially for Millennials. As a natural progression of things, the convenience and relevance of free user-generated content keep consumers coming back for more.

“We’re seeing the media and entertainment landscape become more interconnected and interdependent. The report shows that half of consumers often watch shows or movies on video streaming platforms after learning about them on social media, frequently discover new music while playing video games, and wish that more of their favourite movies and TV shows were converted into gaming experiences. In this context, it becomes apparent that brands need to transform the way they connect with different categories of consumers, integrating all these new realities into the business strategies based on which they will develop and promote products and services,” said Andrei Ionescu, Consulting and Risk Advisory Partner-in-Charge at Deloitte Romania, and Leader of the technology, media, and telecommunications industry.

Although not currently the most popular online activity, viewing user-generated content is gaining ground. According to the study, consumers choose to watch this type of content because it is available for free (39%), relevant (35%), can be accessed anytime, from anywhere (30%), and always offers something new to see (28%). Moreover, for many people, content creators are not just entertainers, but influencers whose opinions they consider when trusting a brand and making buying decisions. No less than 64% of Generation Z, 57% of Millennials, followed by 41% of Generation X respondents and 16% of Baby Boomers and Matures say they are more likely to purchase a product after watching a review by a content creator or an influencer they follow.

Video games are another entertainment activity that provides consumers with different benefits, the study also reveals. They can support players’ emotional needs, such as boosting their self-confidence (73% of Generation Z and Millennials; 47% of Generation X, Baby Boomers, and Matures) and improving their self-image (49% of Generation Z and Millennials; 19% of Generation X, Baby Boomers, and Matures). For consumers who regularly play video games, this activity also provides social benefits, as 75% enjoy playing games with their families, while 62% feel that meeting up with their friends in video games is an important way to spend time together.

USER-GENERATED VIDEO FEEDS OFFER UTILITY, COMMUNITY, AND TRUST

Content creators play a big role in helping younger consumers make purchasing decisions. 70% of Generation Z and 68% of Millennials consider that user-generated videos help them discover new products and services that they want to use, with only 47% of the Generation X and 24% of the Boomers + Matures having the same opinion. At the same time, the majority of Generation Z and Millennials are willing to trust a content creator’s opinion over an online review and are more likely to purchase a product after they’ve watched a review by an online content creator or influencer they follow (64% of the Generation Zs and 57 of the Millennials).

According to GWI’s report on Generation Z, memes are a big part of how Gen Z communicate and how they spend time online. They’re not just something they look to for entertainment. Among Gen Z who use them, a large proportion say they use memes to process emotions and express ideas they’d struggle to communicate. For brands looking to engage with Gen Z online, a relatable meme could be the way to go when used correctly.

Among Gen Z who use memes, 64% say they like it when a company uses them for marketing purposes. It makes sense too, as the most distinctive things Gen Z want brands to be are young, trendy, and funny. It’s all about a relatable human side rather than anything traditional or corporate. Netflix is a good example of a brand that uses memes in their marketing: they often use their own content to create new memes to post on their social pages. But it’s not just brands who can get involved. Even US state agencies have started using memes. The Washington State Department of National Resources used a meme to educate people about what to do if they encounter a bear. It’s a clever way of showing people the human side behind an organisation. Brands and companies should be aware though that meme trends change, as does what’s funny or trending, so it’s all about being on the pulse; a meme used at the wrong time could be seen as cringey and uncomfortable.

LET THEM ENTERTAIN YOU

As Gen Z are an entertainment-driven generation, things like how-to videos, bite-size educational videos, and other expert-driven content are likely to resonate. Banks and fintech companies could lean on finfluencers, who’ve been making waves on platforms like TikTok and are likely to capture the attention of Gen Z.

Gen Z’s favorite genre is entertainment/ variety, which has knocked movies off the top spot. Part of this is likely due to this generation becoming used to digesting shorter forms of content—think Instagram Reels, TikTok, and YouTube Shorts. This is another reason why the visual media space has become so competitive: linear and streaming TV providers not only have to compete with each other, but also with video viewing on other online platforms. This means providers will need to work even harder to capture Gen Z’s attention. Prices and the cost of living crisis are also adding to the pressure. Many are looking to make cuts where they can so any TV subscription service that doesn’t deliver in terms of content or is deemed too expensive is likely to be on the chopping block. Gen Z are a key audience for these services, but 37% are looking to cut back on the number they subscribe to.

What is also very interesting in GWI’s study is the fact that for this generation, content matters more than price. Content that’s relevant to their interests, original content, new content being regularly added, and a large amount of content are most important for this audience when it comes to paying for a streaming service. For brands looking to keep this group engaged, content really is king.

Moreover, social has become the top source of brand discovery and product research for Gen Z, beating out search engines. Part of this shift is the need to get more recommendations and ideas from real people before taking the plunge on a purchase, with 3 in 10 Gen Z saying they use social media as a place of inspiration. Just as Deloitte showed as well, user-generated content is a key way brands can get involved here—by showcasing their products with real people.

According to GWI, while Instagram is Gen Z’s most-used platform outside China overall, TikTok is a big part of social media’s growth. Their use of TikTok outside of China has grown the most of all the social media platforms tracked, rising by an impressive 37% since Q4 2020. With 83% of Gen Z TikTok users saying they use the platform for entertaining/ funny content, the app is clearly the go-to place for some light-hearted relief. One of the big pulls of apps like TikTok is also the ability to get real views or opinions from real people, making it more relatable. As a result, Gen Z are often going to TikTok before Google for advice about anything from finances, travel or beauty trends. According to research by Google, nearly half of young people look to TikTok or Instagram instead of Google Maps or Search for answers. It’s a big shift in behaviour, and something brands should be mindful of.

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