Brands That Implement Social Responsibility Will Connect With Gen Z

Gen Z is on the loose. Now nearing their mid-twenties, Gen Z is surfing, swiping, buying and starting to make a big impression. Born in 1995, Gen Z is more than 66 million strong in the U.S., the most diverse generation in history and will represent more than 40% of all consumers by 2020. Gen Z is also very savvy and very particular – similar to their Millennial neighbors – about who they will spend their money with, favoring brands with a strong message of corporate social responsibility (CSR). Some business leaders believe a robust, built-in CSR policy is the only way forward for brands that want to reach Gen Z.

The New York Times columnist Nicholas Kristof, said “Doing good is no longer a matter of writing a few checks at the end of the year, as it was for my [Baby Boomer] generation; for many young people, it’s an ethos that governs where they work, shop and invest.”

Brands Must Take CSR Seriously To Reach Younger Consumers

Among younger consumers, there is a fair amount of skepticism, including the role of businesses in society. Gen Z, in particular, looks at the world with a side-eye stemming from having grown up amid recessions, fractured politics and often unexpected job transitions for their Gen X parents, leading to decreased trust in businesses.

However, businesses can reach wary Gen Z consumers by embracing strong CSR as part of competitive growth strategies and not just half-measure initiatives trotted out a few times a year or designed to distract from a crisis. According to a young Gen Z student cited in a PRDaily article, whether it’s a specific issue or larger company values, Gen Z knows when a company isn’t being sincere. “What I understand is actual commitment to something,” said that 22-year-old student in New York City. “One thing I get really turned off by is when it appears that what [companies] are trying to promote or what they are saying is not aligned with their actions. Commitment, action, follow-through and transparency matter to me.”

These CSR preferences by Gen Z align with those of Millennials, who expect to see more gender equality in business leadership, want to witness ethical practices in fashion and, in general, favor companies that incorporate CSR into their corporate cultures and business models.

Younger Consumers Will Buy From Brands They Perceive As Socially Responsible

According to The Deloitte Global Millennial Survey, “Millennials and Gen Zs, in general, will patronize and support companies that align with their values… Many say they will not hesitate to lessen or end a consumer relationship when they disagree with a company’s business practices, values or political leanings.” Among Millennials 42% have “begun or deepened” their relationships with businesses they believe have positive impacts in society or the environment, and 37% have abandoned or retreated from companies they didn’t believe were ethical.

Gen Z, although more liberal than prior generations, is pragmatic and keenly interested in authenticity regardless of political affiliation. A report by McKinsey states, “Consumers increasingly expect brands to ‘take a stand.’ The point is not to have a politically correct position on a broad range of topics. It is to choose the specific topics (or causes) that make sense for a brand and its consumers and to have something clear to say about those particular issues.” Once Gen Z consumers feel confident a brand is authentic and has ethics aligned with their own, they are more likely to give that brand their business. In fact, 70% of Gen Z consumers try to buy from companies they consider ethical, and 65% try to ascertain the origins of products they are buying.

Many Companies Have Successfully Incorporated CSR Into Their Business Model

Certain companies, like Patagonia, have always put CSR at the forefront of their business practices, but more companies are beginning to take action. Ikea is on a mission to “become 100% circular,” turning waste into functional products, and they also have a foundation that works with communities in crisis, providing water and electricity. Ikea’s CSR fits with their audience, which is typically young and European, both groups committed to buying from value-based brands. “By taking responsibility and working together, we can make a true change. We have a long-term perspective and the financial strength to invest in activities that will benefit both the planet and our own business future,” said Torbjörn Lööf, CEO at Inter IKEA, when speaking about the brand’s push to become climate positive.

Although committed to making ethical, value-based purchases, Gen Z is also open to companies that have made mistakes if the course correction feels authentic, because despite their inherent skepticism and nerves about the future, Gen Z is trying to be optimistic. By buying from – and working for – brands and companies that have strong value-centered messages, Gen Z can have a measure of control over the future. Brands should recognize that Gen Z preference in their marketing efforts and corporate culture initiatives if they want to experience long-term success with our youngest consumer generation.

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