We’ve been hearing about Millennials for so long that it’s easy to forget that there’s a much bigger derby going on right now: which brands and apps will Generation Z, the successors to the Millennials, choose for its own? Who literally will be the voice of the next generation?
It’s a consequential question. In the 2015 U.S. Census update, Gen Z (roughly defined as those born between the late 1990s and now) already comprised nearly 26 percent of the population, a bigger share than either Millennials or Baby Boomers.
By sheer numbers alone, Gen Z will be at least as consequential as either of our last two population bulges. Simply put, the group will matter a lot for a long time, leading shifts in American pop culture, commerce, media and technology. Already, it commands huge buying power and influence, even though its oldest members aren’t old enough to legally drink.
“The pitch is that (Gen Z kids) have the largest amount of disposable income of any youth generation, and are the primary decision makers in terms of what’s being spent in families,” said Ramaa Mosley, CEO of Adolescent Content, a “creative digital youth agency” that represents about 1,000 directors/writers/creators between the ages of 13 and 25. “It would be ignorant to not listen to them. It’s also blind to continue to believe that having adults tell young people what they want is effective.”
The race for Gen Z’s attention, its most valuable commodity, has been going on for a while. Giant Facebook has been trying mightily to entice youths to use its apps, and they do, to the extent they must but not much more.
Even Sean Parker, Facebook’s founding president, acknowledged his former company is “exploiting a vulnerability in human psychology,” doing “God knows what” to children’s minds. So maybe it’s best the kids aren’t so interested in Facebook.
So if not Facebook, then who is talking to this generation?
Snapchat was built almost solely on its appeal to Gen Z. It layered fun augmented-reality tools on a messaging, photo and video app that, happily for Gen Z, also made content disappear after viewing.
For Gen Z kids under constant social-media surveillance by family, friends, teachers and trolls, Snapchat’s playful impermanence was welcome, a feature, not a bug.
Even better, its cryptic interface confused the hell out of grown-ups (though newly public Snap Inc., worried about poor growth and still-flummoxed investors, said this week it will revamp the UI).
Snapchat remains soldered into the mental wiring of many Gen Z youths, who return to it an average 20 times a day, and stay once they get there. Piper Jaffray’s semi-annual survey of more than 6,000 teens found that, despite its flat subscriber numbers, Snapchat is getting more popular with its core audience.
In Piper Jaffray’s four surveys between spring of 2016 and fall of this year, Snapchat’s preeminence as teens’ favorite app almost doubled, to 47 percent of those surveyed. Facebook-owned Instagram remained at second, but virtually unchanged at 24 percent while Facebook dropped below 10 percent. (Of note to Apple haters: the survey also found that 82 percent of teens expect their next phone to be an iPhone, the highest level of support since the survey started 17 years ago).
Snapchat’s Gen Z stickiness was one major reason Facebook first tried to buy, then failing that, shamelessly copy Snapchat. It’s also why NBCUniversal and Tencent Holdings have bought big stakes.
And now Facebook has taken another tack, into the burgeoning space for “positivity” apps (i.e., the opposite of the experience many teens have on Facebook). Last month, it acquired the mobile app tbh for an undisclosed price, though likely one low enough to avoid automatically triggering a U.S. Justice Department review.
Don’t feel bad if you haven’t heard of tbh. The company launched in August, in limited cities and only on iOS. But it quickly piled up more than 1 billion anonymous poll answers to esteem-building questions such as what friend is “best to bring to a party” or which one’s “perseverance is admirable.”
In two months, the app had been downloaded 5 million times, and is used 2.5 million times a day. A remarkable start, and delightful that it’s providing an empowering antidote to online trolling and bullying. There are good reasons Gen Z kids have jumped on it.
And it’s not the only one playing in the positivity space. I recently talked with Ole Vidar Hestaas, the CEO and co-founder of the just-launched mobile photo-sharing app from Kudos&Co Inc. The app is “a platform where kids can go and have positive sharing experiences,” Hestaas said.
Kudos is focused on children 7 to 13 who aren’t supposed to be on Facebook. It puts an emphasis on safety and security, with all posted photos reviewed by actual humans, backed by artificial-intelligence screening tools.
Parents, who supply their email address instead of the child’s, are notified every time content is to be shared, and also of any friend requests. And Hestaas promised the site will never have advertising, though he was much hazier about how the site will pay for itself.
Hestaas, whose company started in Norway in 2014 before moving to the Bay Area, is targeting an international Gen Z cohort that he estimates at between 500 million and 700 million youths.
“Already there are almost 100 million kids below the age of 13 who have one or more profiles on an adult platform,” Hestaas said. “They need this product, they really do. It’s a large market, it’s an interesting market and it’s an untapped market.”
They’re hyperconnected, Hestaas said, but afraid to leave too many digital traces, given the ferocious problems many have experienced with trolls, former friends, bullies and others.
Kids “are actually more concerned about privacy than we are,” Hestaas said. “A lot of young girls posting on Instagram are doing it with fear, because they’re afraid of negative comments.”
Positivity isn’t the only direction Gen Z is headed. Mobile apps in general are what matter, but so too do music and live interactions, which seem more authentic and less concocted than highly produced videos, even on places such as YouTube. Those preferences have helped drive the rise of China-based karaoke app Musical.ly and its spinoff live-video app, Live.ly, which have built powerful affection among tweens and teens. Three-year-old Musical.ly has 60 million monthly users.
Musical.ly and Live.ly were just acquired this week in a $1 billion deal by Beijing Bytedance Technology Co., the Chinese parent of news app Toutiao, the Wall Street Journal reports. Bytedance itself recently beefed up with investments that put its worth at $20 billion.
And brands are striving mightily to connect with these audiences. Adolescent Content’s creators across five continents have worked with companies such as Disney and Proctor & Gamble to tell branded stories that have a better chance of appealing to the hyper-connected Gen Z, Mosley said.
“The audience is not on television, It’s all digital,” Mosley said. “But that’s not anything new that anyone didn’t know. It’s just that people kept thinking they could keep doing the same things and get different results. If you’re an adult-driven platform reaching Gen Z, you’re five steps behind, in my opinion.”
For brands, the biggest problem may be that Generation Z is deeply suspicious of anything that feels too much like a sales pitch.
“This audience is highly attuned to bullshit,” said Mosley. “We put (ad proposals) in front of our kids and ask them about content and they spend all day long going, ‘That’s bullshit,’ and ‘That’s bullshit.’ They’re just highly attuned. You can see they’re looking for content in new ways. They’re totally interested in what their peers are saying about each other. They don’t think adults are interesting or brands.”