Gen Zers are starting to earn more money, presenting providers with a burgeoning opportunity to grow volume. Gen Z already accounts for $143 billion in global spending power — which will only increase as they join the workforce, earn more income, and begin spending more.
But providers must cater to Gen Z's propensity to spend digitally to bring in that volume. Gen Zers use digital peer-to-peer services and mobile wallets more frequently than their older counterparts, for example, presenting providers with an opportunity to ramp up their digital strategy and test new digital features to attract Gen Z. And providers need to move in on these users early because they're beginning to shift from their parents' payment methods and develop brand loyalties of their own.
In this report, Business Insider Intelligence will offer payments firms recommendations to attract, engage, and retain Gen Zers. We have developed a framework based on industry conversations and research that identifies six key attributes of a payments product that specifically targets Gen Zers: social, authentic, digital-native, educational, offering value, and evolutionary. Using these six traits as a guide, Business Insider Intelligence will offer actionable insights that payments providers can use to develop a strategy to draw in Gen Z and retain them throughout their lives.
To attract Gen Z, payments players need to leverage peer groups and emphasize customer-first features.
Gen Zers tend to pay in the same manner as their friends. Providers can take advantage of network effect to bring groups of Gen Zers onboard at once.
And they're most inclined to adopt payment products that are the cheapest or most convenient. To convey authenticity, providers must prove to users that their products were designed to make their lives better.
To engage Gen Z, payments providers should concentrate on offering a personalized experience that rewards customers with discount-based incentives.
Gen Zers value a clear and coherent purchasing experience. Providers should develop purchasing experiences that feel simple and intuitive to Gen Zers, who will abandon brands that make it hard for them to pay.
But discounts are the best way to entice these savings-savvy customers to form habits. Gen Zers value cost above almost everything else, so building in discount-based incentives to complement a strong payment experience will keep them [...]