Digital, decisive and drone-ready: Gen Z’s customer experience expectations

by | May 18, 2017 | Public Relations

More than any generation before them, Gen Z has distinct expectations of brands with regard to customer experience, service and engagement through emerging channels, new research from American Express and Forrester Consulting reveals.

The study findings show that Gen Z is already financially empowered (81% are making purchases on their own), has mobile spending power (59% have made a purchase via mobile app in the last year) and has high expectations from brands when it comes to gaining their trust—46% of Gen Z respondents said that data security and privacy is a must-have to keep their business.

The discussion centered around how each brand is modernizing service and experiences for their current customer bases, as well as for the next generation of consumers.

“Over the past few years we’ve modernized our approach to service and increased our investment in mobile technology to best serve our Card Members, including the always-on, always-connected Gen Y,” said Luke Gebb, SVP of Enterprise Digital at American Express, in a news release. “Our research shows that Gen Z is two steps ahead when it comes to interest in payments solutions and technology and their expectations of brands. We’re focused on meeting our customers where they are as we continue to reinvent how we deliver an exceptional service experience.”

Starting from a trusted place

Despite having less experience with brands, Gen Z and Gen Y have similar expectations when it comes to trust and service:

  • When compared to Gen Y, Gen Z cares more deeply about the reputation and brand image of the brands they use (50% vs. 42%).
  • Gen Z was twice as likely as Gen Y to stop using a product, brand or service due to responsiveness on social media (21% vs. 9%).
  • The top three responses from both Gen Z and Gen Y around their sentiments of why they would stop using a product, service or brand were aligned: unexpected fees or charges, security breaches and negative news about the brand or a product.

On the go, on their own terms

Gen Z interacts with the world on their mobile phones and does not find it invasive to receive texts, notifications or offers from brands via mobile. When it comes to interacting with brands or retailers to receive offers, incentives and sales notifications, Gen Z is:

  • 22% more likely than Gen Y to prefer in app notifications to receive offers, incentives and sales notifications.
  • 23% more likely than Gen Y to prefer interacting via social media to receive offers, incentives and sales notifications.
  • 100% more likely than Gen Y to prefer interacting via online chat technology (i.e. WhatsApp).

Gen Z shows increased proclivity towards adopting self-service and automated resources.

  • More than twice as many Gen Z consumers ranked using text/SMS messaging, searching online resources and talking over the phone with an automated system (i.e. not speaking with a customer service rep but rather using automated menus) as their top three preferred customer service channels to solve a problem, over Gen Y. Gen Y was twice as likely to want to use chat messaging on a company’s website and 25% more likely to resolve an issue via phone.

Tech-driven loyalty

Gen Z’s brand loyalty is closely tied to seamless customer experiences. Gen Z respondents said they were more likely than Gen Y to become disloyal to a brand due to:

  • Poorly designed mobile features
  • Slow response during online chat for sales or customer service issues
  • Poor features/responsiveness on social media

Gen Z was two times more interested than Gen Y in features that embody instant gratification such as 1-hour delivery made by drones, ability to purchase products or services via chat apps or social media (i.e. making a purchase via Facebook Messenger) personalized experiences via bots and AI and the ability to pay using a watch or other wearable device.

Advanced financial literacy and mobile payments readiness

Gen Z is active in managing their finances and has high expectations of financial institutions. They also show a level of readiness when it comes to mobile payments:

  • 81% of Gen Z survey respondents report that they make purchases on their own, 77% keep careful track of finances and 72% have a checking/savings account.
  • 43% of Gen Z respondents have used a card branded checkout solution (i.e. Amex Express Checkout) in the last three months, compared to only 29% of Gen Y.
  • 33% of Gen Z respondents have used a device specific mobile wallet (i.e. Apple Pay, Samsung Pay or Android Pay) in the last three months, compared to only 22% of Gen Y.

The study, “Raising the Bar: How Gen Z Expectations Are Reshaping Brand Experiences,” surveyed 1,027 North American Gen Y (ages 23 to 37) and Gen Z consumers (ages 16 to 22).

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