Retailers, heed Gen Z’s desire to make payment processing easier.
Without offering smooth payments and a full set of system tools to meet the demands of this rising generation born between 1997 and 2012, retailers can say goodbye to Gen Z as customers.
As if responding to ever-changing consumer buying trends wasn’t already difficult, the buying mindset of Gen Z can be elusive and confusing. If you spend some quality time studying industry reports on what retailers need to do to grab Gen Z’s attention and close deals, you might just wonder how to meet their wants and needs. .
For example, some reports call for giving Gen Z shoppers unique in-store experiences, relevance, and novelty when shopping. The Gen Z population is paying attention to consumption habits, other reports state.
Most of these strategies are applicable to all shoppers in the new omnichannel landscape. But successful retailers need to find the clarity to onboard the Gen Zers.
Essential payment choice
Gen Z shoppers want authenticity. Being young, they are in no hurry to build brand loyalty. They expect value from your brand. If they don’t find any, they will shop elsewhere. Retailers targeting this shopping category should:
- Focus on social media advertising
- Truly understand Gen Z culture
- Take a stand on social issues
- Offer purchase options buy now, pay later (BNPL)
Perhaps most needed in this list of what Gen Z shoppers want is the payment options offered by a retailer.
Gen Zers aren’t shy about paying more for durable products from brands that share their social and political views. But without providing convenient payment methods, retailers are making a losing proposition, suggests Greg Cohen, CEO of payment and commerce technology platform Fortis.
“To meet these new demands head-on, retailers must invest in and improve their overall payment experience by providing a comprehensive set of tools that not only offer frictionless payments, but also split payments and a streamlined checkout process to meet Gen Z’s desire for convenience,” he told CRM Buyer.
Payment is part of the journey
According to a 2020 study by Fiserv, 70% of Gen Z shoppers still planned to choose contactless payments post-pandemic because it’s simple. Businesses need to prepare for the new payment demands that are expected to follow.
It is the customer engagement that leads to making a purchase. This process should be integrated into the entire journey, according to Cohen.
Retail is not a one stop shop. The world of software and payments has become very vertical, he proposed. Take, for example, restaurant software. You might have restaurant software specifically designed for pizzerias, as opposed to Chinese restaurants. You see this same evolution in almost every vertical.
A second trend will be winners from core systems that are much more open architecture, Cohen added. This allows retailers to plug some of these value-added elements into their existing systems to meet customers where they are.
Many software platforms try to own every element of an ecosystem. The opening of this ecosystem allows more players to transact in their specific markets. That’s why retailers should research the wide variety of payment tools available, he advised.
Simplicity and convenience
Gen Z consumers stand out from other age groups primarily in their insistence on fast, contactless and wallet payment forms, according to Tom Tucker, President of Americas at Till Payments.
“These include the Apple Pay/Google Pay and Buy Now buttons. Buy now, pay later is the largest of this group,” Tucker told CRM Buyer.
Experience is imperative, he added. Safety is not their primary concern. Credentials stored for faster payout are table stakes.
Fiserv’s research showed that most Gen Z shoppers plan to use contactless payments post-pandemic because it’s simple. Businesses need to prepare for the new payment demands that are expected to follow,” he reiterated.
“User interfaces should be simple and have minimal consumer interaction required,” he added.
The way retailers make this preparation is rather simple, he suggested. Update all user interfaces for one-click payment and wallet types.
“Gen Z and Millennials have grown up with the internet and need wallets, BNPL and mobile technology the most. Gen Xers and Baby Boomers are fast adopters but slow to move. Covid helped bring them two to three years forward dramatically,” Tucker said.
Zoomers Mobile-First Mindset
Marketing to Gen Z is very different from other age groups, primarily because they are the first generation not to experience life without a screen in their hands, observed Kristin Dorsey, vice president of marketing at the CRM software company Linc.
“As a result, Zoomers expect a mobile-first customer experience and digital ads aren’t as effective as they’ve learned to ignore them. Gen Z doesn’t want to feel sold, so more more brands are prioritizing educational content, influencer marketing, earned media, and community building over big ad buys,” she told CRM Buyer.
This scenario is the basis of how businesses must prepare for new payment demands to meet the unique shopping situations of Gen Z, Dorsey continued. This mobile-first mindset means businesses need to keep up to date with the latest cashless and contactless payment options to create the ideal customer experience.
“Gen Z favors mobile payment methods over cash – and even debit or credit cards – far more than previous generations. The convenience of contactless digital payments like Apple Pay and Google Pay is a big reason for this, along with concerns about the spread of germs using cash and cards,” she explained.
Also, having grown up after the Great Recession, they are more skeptical of traditional financial institutions and their products. This is why companies need to stay ahead of new alternative financing options like BNPL, she concluded.