New report reveals authentic brand ethics are essential for Gen Z to part with their cash

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Engagement and insights agency for young people, Beatfreeks has released its new report: ‘Institutions of the Future: A National Youth Trends report into Gen Z and the Private Sector’, which reveals that ethics and an authentic stance on societal issues lie at the heart of young people’s relationships with brands and strongly influence their spending power.

Almost nine in ten young people (87%) pay attention to brands’ ethics when buying from them, and ethics was the most frequently chosen reason behind Gen Z selecting their ‘favourite’ brand in the research.

When exploring the most important factors for making a purchase, one in four (24%) said a brand’s ethics was the most important factor in encouraging them to part with their cash. Ethics was second only to ‘quality’, which 50% said was the most important factor, beating ‘cost’ which was chosen by just 23%, illustrating a more environmentally conscious consumer shift in prioritising sustainability over quick purchases.

It was predicted that by the end of 2020, Gen Z would account for 40% of global consumers, showcasing that the purchasing power of young people should not be overlooked by brands.

Beatfreeks’ research of almost 2,000 young people across the UK aged between 16 and 24, categorised as Gen Z, was conducted in late 2020, against a backdrop of Covid-19 and the huge momentum following the Black Lives Matter movement. It revealed that this generation do not take brands’ stances on societal issues at face value.

Almost two thirds of Gen Z (64%) say that when a brand comments on an issue, they go online to research and check, with just 6% simply believing it to be true.

While an enormous 95% of young people say that brands should get involved in societal issues in some capacity, and over half (53%) highlight the importance of brands supporting these causes on social media and in real life, they want to see this change starting from within before brands take a stance. When asked how they want to see brands get behind societal issues, seven in ten (69%) respondents said that brands should make changes inside their own organisation. Feedback revealed the importance of looking at how diverse leadership is, how inclusive and accessible products are, how well organisations treat staff and 63% said that they want to see brands fund other people to make a societal impact. 

Anisa Morridadi, founder and CEO at Beatfreeks, comments: “As the first generation of digital natives, Gen Z are prolific content consumers and creators. Our new report shows their willingness to uncover and call out social injustice online, but crucially they believe it shouldn’t just be left to them. There is a new expectation that brands will listen, respond, and get behind societal issues, particularly after the enormity of societal change from 2020. Not only do they expect this, but brands having an authentic stance on values, particularly when it’s driven from the inside out, is now essential for Gen Z to part with their cash. This generation provides a huge purchasing power, and they will spend where they can see action, so brands need to start making serious moves to become genuine ‘institutions of the future’.”

Amelia, 23, from Birmingham, who participated in the survey adds: “As a result of recent political movements and increasingly topical societal issues such as diversity and sustainability, we’re becoming more “WOKE” as a generation and as consumers more widely. Companies need to acknowledge this shift in behaviour, take a step back and communicate how, in light of these developments, they are going to make actual change by ensuring a more diverse and inclusive workplace. This will allow brands to appeal to a wider audience demographic by becoming more authentic and purpose-driven.”

The report also provides insights into Gen Z’s career priorities, and 44% said the most important factor for them is doing something they love. This was more than double the number of young people (20%) that selected money as the main factor that influences their career choice. A further 14% chose a good work/life balance as their top career priority. Despite these aspirations, careers and education and money remain the top worries for young people, according to 77% and 60% respectively.

Brands looking to diversify and appeal to a younger workforce should also consider the importance of having autonomy on working locations, as almost half (44%) said that they would prefer a mixture of working from home and being in work, compared to 24% who chose returning to work from a set workplace. Although this was still higher than number who said they would prefer to work from home (17%).