Members of Gen Z are digital natives, the first generation to live completely in the internet age. Born between 1997 and 2012, it seems they’ve got a smart phone permanently glued to their hands. While parents might not like this, Gen Z’s attachment to technology is great news for subscription
businesses — this generation uses their phone to shop more than any other generation.
According to the 2021 Consumer Culture Report by 5WPR, Gen Z spent an additional 43 minutes per day online shopping during the COVID-19 pandemic, with their total screen time across tablets, phones, laptops and TV coming in at about 8 hours a day. And they’re not alone. The pandemic accelerated everyone’s shift to e-commerce. The US Department of Commerce reports consumers of all ages spent more than $347B online in the first 6 months of the pandemic, an increase of 30% over the same period in 2019.
Since Gen Z is almost always connected online, subscription businesses that want to grab this new generation of shoppers need to invest in a positive online experience
The Freedom of E-Commerce
E-commerce has opened a whole world for Gen Z, and they love to explore it by shopping for electronics, technology, and beauty products. While subscription businesses like streaming services and monthly beauty boxes immediately come to mind, younger shoppers have no qualms about buying clothing, shoes and other items online, things previous generations typically bought in person.
The Power of Social Media
And where are Gen Z shoppers finding the latest gadgets and fashion necessities? On social media, of course. In fact ,58% of Gen Z have bought something they spotted on social. It’s not just big brands like Nike that are seeing social media success, however. Gen Z loves discovering new businesses online and likes to shop small, local brands more than ever before. Since this generation is still made up of a lot of teens, subscription businesses can develop a long relationship with Gen Z shoppers and build strong brand loyalty. Smart businesses will listen to these young customers and even ask them to be part of key decisions and product offerings. These conversations are valuable market research and they’re happening daily on Tik Tok and other social media platforms.
The Value of Authenticity
Most companies have their core values posted online for everyone to read, but actually living these values is what matters to Gen Z. These shoppers are drawn to social causes and will shop with their conscience. To them, a company means nothing if their products don’t make the world better. Gen Z cares about where their money is going and won’t hesitate to boycott a brand if it’s not genuine and authentic. Words and actions matter to these shoppers. You may have the best cosmetics on the market, but if you’re hurting anyone or anything as you produce them, Gen Z shoppers will notice and quit buying from you. And call you out on social media. However, if a company stands for something they believe in, Gen Z will happily spend their money there and tell others to shop there too.
The Importance of a Positive Online Experience
Since Gen Z is almost always connected online, subscription businesses that want to grab this new generation of shoppers need to invest in a positive online experience. Gen Z wants to buy at any time without any friction or problems, which means failed payments have no place in this experience.
As a subscription provider, you can keep Gen Z shoppers happy by using a Payment Authorization Management system that overcomes payment-related snags.
Payment Authorization Management (PAM) is the category name for FinTech solutions that helps improve the accuracy of payment authorization decisions. FlexPay’s Invisible Recovery™ platform is the leading failed payment recovery solution in this category.
The Invisible Recovery™ Solution
Invisible Recovery™ is an AI-powered solution that optimizes customer recovery by creating individual strategies for each failed payment, resulting in the best possible customer and revenue retention.
Our failed payment recovery solution works quickly while completely avoiding customer visibility to the failed payment, which eliminates the churn created when subscription customers are made aware of their payment issue.
FlexPay research shows Invisible Recovery™ delivers the highest rate of failed payment recovery, as well as sustained retention for months to come.
- Up to 70% improvement in failed payment recovery rates compared to other recovery solutions
- Up to 45% longer customer retention following recovery compared to other failed payment recovery methods