With this generation we’re finally going to see the U.S. catch up with the rest of the world [in terms of mobile penetration].
In our recent report “Gen Z: Digital in Their DNA,” we explore how the fledgling generation following the Millennials are communicating, socializing and shopping online. As part of our ongoing research into this cohort, we spoke to Christian Kurz, vice president of research, insights & reporting at Viacom International Media Networks, the media conglomerate whose portfolio includes brands like Nickelodeon and Comedy Central. Among other things, we discussed how connectivity is shaping the values of today’s kids and young adults, how parents feel about their use of technology and how these young consumers are influencing household purchasing decisions.
Would you agree that Gen Z is the most connected generation yet?
[Gen Z is] the most connected generation, and I think particularly for this group, they’re growing up or they’re born into an environment where the digital technology is just so much more prevalent than it ever has been.
What role is mobile playing for them?
With this generation we’re finally going to see the U.S. catch up with the rest of the world [in terms of mobile penetration]. And we are seeing more and more ownership of mobile phones among younger and younger populations within the U.S. and Canada.
A little anecdote that we found in focus groups with very young kids is that some of them were preferring an iPod Touch to an iPad. Simply because the screen was smaller and their hands were still so small that an iPad was just too big for them. So small screens are particularly useful for younger kids, and then you see in nations or cities where you have a lot of driving, this “hand back the phone” effect, so the parent is giving their own phone to the child in the back seat.
We also do see that devices like an iPod Touch give you social currency [when it comes to] sharing video, which isn’t necessarily all through social networking. So I download this video, I find it, and then I show it physically to my friends on my device. It doesn’t need to be connected necessarily to the Internet because I can download it at home.
So we’re seeing, because of this, a number of kids have two devices. One of them is their phone, which is maybe a clunky, relatively old connected text message-type device. They also have an iPod Touch or something else that isn’t a phone but that they use for everything that is intended to do with a smartphone.
How do parents feel about their child’s use of technology?
Parents’ attitudes toward technology in general have always been and are still very conflicted because, on the one hand, they appreciate the fact that they can use them as “babysitters,” and they also are more and more appreciating that those devices can help their children to learn.
At Nickelodeon we did a study called “Permission to Play,” which focuses on how kids play and what parents allow them to play, and it’s very clear that parents prefer structured play to anything that is not very structured. [Mobile] devices enable parents to put a structure around play, because with varied apps that is clearly possible. On the other hand, they have this conflict of too much screen time and all that. And we know that parents in a number of places are no longer limiting their kids’ TV time but instead they’re limiting screen time, which includes the computer and various other devices.
As kids consume more content online, how are their sharing habits evolving?
In general, not just for kids but it’s equally true for the older Millennials, content provides their social currency, particularly funny content. If I post something, then that says more about me. If you like my humor, then you are going to “get” me. And it gives me social credit—it’s currency because I was the one who found it.
Our data indicate that a significant number of kids prefer socializing online than off. How is social networking changing the way they communicate with each other and the wider world?
The biggest constraint on social networks for younger kids is the terms and conditions. The fact that you have to be 13 to sign up to Facebook is a barrier. However, we have seen in research that parents are, I wouldn’t say actively encouraging, but they are certainly aware that their kids are on Facebook, and that to a degree is perfectly fine. And it is partially also because kids and parents are friends on Facebook anyway.
Gen Xers tend to communicate with people through social media that they know offline. However, for [younger generations], that is not necessarily the case. A lot of their friends, as your report says as well, are in far-flung places.
Speaking more broadly to Gen Z, what are some of the things they value most?
I think that warmth is, like love, the new sex, drugs, and rock & roll. Connecting is really important to the Millennials and post-Millennials, and also to be in on the joke, if you will.
They’re not rebelling. It’s not like Generation X used to be. They are happy to work within the establishment. They think they are the establishment, and as long as you are providing the tools, they are absolutely fine to work within it.
The most important value to this generation that we found is the element of happiness—happiness and self-fulfillment.
How do you think this willingness to work within the establishment affects the way they relate to brands?
What we found is that just as family is seen as friends, brands are friends too. So brands need to behave like friends, and they actually need to therefore behave much more responsibly rather than just shouting out loud messages saying “Buy me, buy me, buy me.” They need to offer something, because I’m not going to be friends with somebody who’s not offering something, not bringing anything to the table.
Brands generally need to be everywhere this generation is, so that’s offline, online, on TV, on various social media. But they need to be there with a purpose, and it’s pretty bad to not be there because if you’re not there, you don’t exist. But it’s better to not be there, than to be there and not offer anything.
It’s very important to get the funny bit in there, too, to get the humor in there and to add something to the conversation. And it’s really important if a brand is on a social network or platform, to listen to what is being said about them. There is nothing more frustrating for this generation than somebody publicizing their Twitter account and then [consumers] complain to that [account] and there is never a response. That’s just not acceptable.
How do you think the current economic climate will affect Gen Z’s outlook on the world?
We’ve recently done a study called “Kids’ Influence Study,” and it was becoming very, very clear that this recession, or call it what you will, is the first time an economic dire situation is dinner table conversation.
This is a lot higher in Latin America and in the countries where the economic situation has been dire before—and where people are used to this kind of conversation—followed by North America, Western Europe, Australia and, to a much lesser degree, some of the Asian cultures, where this is partly seen as difficult to talk about. So parents are absolutely comfortable talking to their kid about what’s going on in the world, what’s going on with their financial budgets. We even had a mother who was trying to explain to her kids that they can’t have any particular thing, and it ended up that she took all her bills, all her monthly bills, put them on the dinner table and let the kids do the math.
That led to kids being somewhat self-censoring because they know, if I can only get certain things, then I should only ask for those things I really, really want and not for everything.
We also found that despite the fact that [parents] are talking to their kids about [the economic climate], they still aren’t necessarily convinced that their kids actually know much about it at all. One in four parents think their kids actually listen. Though I believe, from the kids’ perspective, that is a much higher number because we have, like you, also looked into saving and all those numbers, and you are starting to see kids saving much more than you have before. You are also, by the way, going back to values, seeing kids give to charities or be aware that that is something they should or want to be doing.
In terms of saving, there is a weird example from one of our partners we were doing research with. [Gen Z] operates in a virtual world that gives rewards for doing whatever it is, and then you can buy things for your avatars. One of the kids was saying, “Oh, I’ll get all these points, and then I’ll save some.” And it was really difficult for us to understand why they were saving virtual currency that isn’t even worth anything. But [this frugal mindset] is going even through to that level, so “I’ll have [money] when I need it.”
Do you think this saving mentality is specific to Gen Z?
I don’t think it’s specific to this group, but it’s getting stronger and it’s picking up. Of course, it does depend on the economic situation within the country. You look at Australia, they’ve not really had a recession at all, so clearly that impacts that as well.
You mention that kids are more restrained when they ask for things from their parents. What does this mean for Gen Z as consumers?
In general, purchase decisions are no longer individual decisions. They’re all family decisions. It doesn’t matter who uses what, and that is again partly down to the way Millennials and the wave after that have been brought up, which is, “Your opinion matters, and the only way I can show my child that their opinion matters is by actually listening to them.” So kids are asked by their parents and families to have opinions on various things.
Millennials like consumption. To them, shopping is part of this “making me happy” thing.
How is Gen Z impacting parents’ purchasing decisions?
If you think back to the generation gap, when it existed, kids and parents just did not even speak the same language. They couldn’t communicate with each other. That gap is completely gone, and today we’re communicating about the same thing. I mean, 20 years ago parents and kids would never wear the same types of clothes. Today, everybody wears jeans and a T-shirt. Mothers and daughters are actually sharing the physical same piece of clothing. And a lot of mothers go shopping with their daughter in mind, saying, “Oh we could both wear this.”
Everybody wants to look young, and [kids] are the best at knowing what is cool and hip and trendy, so you’re asking them for advice. You’re honestly asking them, “Does this look OK? What sneakers do I want to buy? What brand is important to me?” So brand awareness is very, very big among Millennials and the younger generation as well. And parents, a lot of times, actually are listening to suggestions from the children for a new brand. And this isn’t just limited to sweets and that type of stuff, this goes all the way to houses and cars.
There are a number of real estate shows where parents who are moving, they find two options and then let the kids decide which of the houses they should buy. So there’s this whole decision-making by committee. There are a few ways of making decisions: One in the middle, which is the family meeting where everybody is deciding together; this is becoming very prevalent in a number of places. Another part is the family filter, where parents come up with options and then filter them and let the kids decide. And then, on the other side of that, is parents taking their kids’ suggestions and deciding as parents. So between those three, we’re clearly seeing a movement toward more kid power, if you will, across categories.
So I would wholeheartedly agree with one of the conclusions in your report that brands need to appeal to both the parents and the kids if they want to be seen as a family brand. And you see that. You see the car ads on TV, certainly in the U.S.—there’s hardly a car ad around anymore that doesn’t have a kid in it. We’re seeing that a lot in the U.S. We’re not yet seeing so much outside, but that’s clearly rolling into the rest of the world.
What does this mean for Nickelodeon?
It’s a family channel. [We] started out as just for kids if you go 20 years back. It’s really not that anymore. In the U.S. particularly, we have a generation of parents that have grown up with Nickelodeon, we call them legacy parents. So that is really imbedded in them, and we have a lot of co-viewing on all our channels—shows like iCarly, Victorious and Big Time Rush. Parents are enjoying them just as much as kids are.
And then you have the extension onto the silver screen with Nickelodeon movies as well. Things like Rango, this is the sort of stuff we’re building ourselves around. It’s family viewing; it’s enabling the family to spend time together. So, unlike 10 or 20 years ago, when people were saying, “Video games are making everybody sit in their own little room and not do anything together”—and cable was the same culprit, everybody had to have their own channel—right now that is completely reversed and we have people coming back together in the living room. We have people setting up bowling tournaments on game consoles, sitting down and watching family television—which we’re not, of course, calling family television, because that makes it sound boring!—but it’s television that everybody within the family enjoys.
And I believe it’s helping families build these close bonds. SpongeBob [SquarePants] is one of the prime examples: Every generation enjoys SpongeBob, and we have done a bit of research on that globally. SpongeBob, by the way, makes everybody happy, from dads to toddlers, including the grandma—everybody just finds something in SpongeBob that is funny. There is a lot of emotional appeal to various ages, and that’s what we’re setting out to do.