Make Way for Generation Z: Marketing to Today’s Tweens and Teens

EXECUTIVE SUMMARY

Key Characteristics

• Summary 1 Gen Z Characteristics

Demographic Trends

• Chart 1 Populations Aged 8-19 and % Growth 2004-2009

Gen Zers as Consumers

Outlook

INTRODUCTION

Definitions

• Summary 2 Consumer Groups 2010

Profile of Generation Z

A diverse group

Materialistic

Tech-savvy

A mind of their own

Desire to succeed

Getting older younger

Au fait with technology

Brand-aware

A sense of fairness

Community-orientated

Going out

Emerging markets lag behind

• Chart 2 Generation Z Characteristics 2010

DEMOGRAPHIC TRENDS

Share of Population

• Chart 3 Global Population by Generational Breakdown 2009

Regional Trends

Asia-Pacific home to more than half of all 8-19 year-olds

Young populations stagnate in developed regions

• Chart 4 Regional Breakdown of 8-19 Year-olds 2009

• Chart 5 % Growth in the Number of 8-19 Year-olds by Region 2004/2009

• Chart 6 % Share Accounted for by 8-19 Year-olds by Region 2009

Country Trends

China’s one-child policy causes drop in young population

Strongest growth seen in Southeast Asia and Middle East

• Table 1 Number of 8-19 Year-olds by Country 2004/2009

• Table 2 Gen Zers as % Total Population by Country 2004/2009

MARKET DRIVERS

Purchasing Power

They’ve never had it so good

Tweens exert pester power

Teenagers more independent

Income by country

• Table 3 Average Gross Income of Population Aged 15-19 by Country 2004/2009

Attitudes towards Finance

Taking more control

Impact of recession

Teenage Employment

Youth unemployment on the rise

College enrolment rates at an all time high

• Table 4 Youth Unemployment 2004/2009

Age Compression

The KGOY phenomenon

Concerns over the sexualisation of tweens

Children under pressure to conform

Parental Influence

Everyone’s a winner

“Helicopter parenting”

Keeping a close rein

Generation Z and the Internet

Forever connected

The net generation

Blogging declines in favour of social networking

• Chart 7 Internet Use in the US by Age Group 2009

Social Networking

Facebook rules

Posting comments and sharing content become more popular

• Table 5 Social Networking Activities in the US 2006/2007/2009

On-line Gaming

MMORPGs

Social gaming

Mobile Phone Use

Three quarters of American teenagers have mobiles

• Chart 8 Teenage Mobile Phone Ownership in the US 2004-2009

Mobile phone usage rises among Asia’s youth

Adapting products to Gen Z

Cheaper smartphones rival iPhone

Leisure and Entertainment Patterns

Staying close to home

Music streaming becomes the new radio

Gaming moves on-line

• Table 6 The Global Market for Video Games 2005/2010

Developments in books and magazines

“Hanging out” at the mall

Celebrity Culture

Commercial opportunities

• Summary 3 Celebrity Fragrance Launches in 2010

Beauty and Hygiene

Self-conscious about hygiene

Segmentation in skin care

Teen beauty on the rise

Parents have their say

Teen fragrances go upmarket

• Table 7 The Global Market for Selected Beauty Products 2005/2010

Beauty services

Teen Fashion

Destination stores attract young shoppers

Department stores fight back

Impact of recession

Surfer brands rule

• Summary 4 Teenage Fashion Brand Preferences in the US 2009

Eating and Drinking Habits

Health versus junk food

Childhood obesity on the rise

Fragmented eating benefits snacks market

Savoury snacks become healthier

Backlash against carbonates

• Table 8 The Global Market for Selected Food and Drinks 2005/2010

Stricter regulations for children’s food

Fast food remains popular

• Table 9 The Global Market for Selected Consumer Foodservice 2005/2010

The problem of underage drinking and smoking

MARKETING TO GEN Z

The power of WOM

Reaction times speed up

Humour and transparency reign

Expert branders

Mobile marketing

Customisation is key

The power of licensing

MARKET SNAPSHOTS

Brazil

Population trends

• Chart 9 Brazil: Tweens/Teens Population Sizes and Growth 2004/2009/2014

Generation Z profile

Consumer market trends

• Table 10 Brazil: Trends in Selected Categories 2005/2010

China

Population trends

• Chart 10 China: Tweens/Teens Population Sizes and Growth 2004/2009/2014

Generation Z profile

Consumer market trends

• Table 11 China: Trends in Selected Categories 2005/2010

France

Population trends

• Chart 11 France: Tweens/Teens Population Sizes and Growth 2004/2009/2014

Generation Z profile

Consumer market trends

• Table 12 France: Trends in Selected Categories 2005/2010

Germany

Population trends

• Chart 12 Germany: Tweens/Teens Population Sizes and Growth 2004/2009/2014

Generation Z profile

Consumer market trends

• Table 13 Germany: Trends in Selected Categories 2005/2010

India

Population trends

• Chart 13 India: Tweens/Teens Population Sizes and Growth 2004/2009/2014

Generation Z profile

Consumer market trends

• Table 14 India: Trends in Selected Categories 2005/2010

Japan

Population trends

• Chart 14 Japan: Tweens/Teens Population Sizes and Growth 2004/2009/2014

Generation Z profile

Consumer market trends

• Table 15 Japan: Trends in Selected Categories 2005/2010

UK

Population trends

• Chart 15 UK: Tweens/Teens Population Sizes and Growth 2004/2009/2014

Generation Z profile

Consumer market trends

• Table 16 UK: Trends in Selected Categories 2005/2010

US

Population trends

• Chart 16 US: Tweens/Teens Population Sizes and Growth 2004/2009/2014

Generation Z profile

Consumer market trends

• Table 17 US: Trends in Selected Categories 2005/2010

FUTURE OUTLOOK

Trends to Watch

Entering new life phases

Gen Z in the workplace

The age of frugality

Gen Zers in developing markets will be better off

A generation saddled with debt

A digital future

Computing will become more mobile

Changing the way we communicate

Social networking

Gaming will move on-line

The shift towards on-line shopping

The future of marketing to Gen Z

The emergence of Generation Alpha

Forecast Demographic Trends

• Table 18 Forecast Number of 8-19 Year-olds by Country 2009/2014

• Table 19 Share of 8-19 Year-olds by Country 2009/2014