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How the metaverse is helping Gen Z connect with their favourite brands

How the metaverse is helping Gen Z connect with their favourite brands

How the metaverse is helping Gen Z connect with their favourite brands

It is a fascinating time to be alive. So many young people are diving into the so-called metaverse to play video games, socialise and even date, while many others from earlier generations are struggling to even understand the concept of living online.

This knowledge gap – a result of digital technologies emerging at pace – forces us to keep on our toes. Those that can’t keep up, easily lose track of what is happening. That’s the thing with metaverse – many people still cannot understand its meaning, purpose and use (and experts can’t really agree on what it really is).

Not that a firm definition is important. Money is already being spent in the metaverse, and commerce is blind to the intricacies, interested only in taking its share of the pie.

And if there is one particular generation that companies and brands are targeting, it is the one with the most disposable income and the most willingness to open their purses – enter Generation Z.

Generation Z (also known as Gen Z/Gen Zers) refers to people born roughly between the period 1997-2012, following the millennials. 

Well past the dawn of the Internet, Gen Zers were practically raised online so it is not out of the ordinary that they represent 60% of metaverse users. Growing up in the times of rapid technological advancements made them easily adaptable to such virtual spaces.

In this blog post we explore this group of people’s main characteristics and how brands can use their large presence in the metaverse to connect with them… and the other way around.

What is Generation Z (Gen Z)?

Already representing the youngest, most ethnically different generation in US history with 27% of the population, Gen Zers are being raised in the midst of technological innovations, internet and social media. A frequent stereotype is them being addicts to technology or being anti-social. The 2000s saw the youth becoming more introverted in real life, but the trend didn't continue on the Internet. Instead, tech-savvy new generations are moving their social life to virtual space.

Before calling out Gen Zers for being tech addicts, we should keep in mind that technology is a generation-shaping consideration. For decades, technology had a big impact on how people communicate and interact.

For instance, baby boomers grew up in times of television expansion and that had an impact on their livelihoods and connection to the world. Millennials have led older generations in technology adoption and embracing digital innovations.

The term metaverse came into existence prior to the birth years of Generation Z, coined in Neal Stephenson's 1992 science fiction novel Snow Crash. In it, humans, in the form of programmable avatars, interacted with each other and software agents within a three-dimensional virtual space that closely resembles the real world. Many years later, the Gen Zers claim to feel more like themselves in such a digital environment.

While it is not right to generalise, recent research can provide us some insight into the main traits of Gen Z. Razorfish and VICE Media Group findings on Gen Z gamers brought to the table some interesting acknowledgements about these young people, their habits and perspectives. 

They discovered that Gen Zers in the metaverse have been six times more likely to describe themselves as introverts as opposed to extroverts. Half of them stated that they felt more like themselves in the metaverse as opposed to real life. Furthermore, 65% of them claimed that online relationships are just as meaningful as real-life ‘offline’ relationships are. And lastly, many respondents stated that gaming enhanced their mental health.

The research brings up the conclusion that Gen Z spends more time within the metaverse, and more importantly, develops meaningful connections to the idea of online identities. The purpose of the findings was to help brands to connect with this generation within the metaverse and through their top activities such as gaming. 

The results of this study are in line with another one conducted by Deloitte in 2021. More than two thirds of respondents stated that they considered themselves games as opposed to millennials or Generation Y whose number one hobby turned out to be watching tv shows or movies. Post millennials still love to binge watch television but that's a fifth-place hobby to them. 

Additionally, in contrast to previous generations, Gen Zers prefer streaming services to traditional cable and getting content down on their cell phones. The average person in the study got their first smartphone just before their 12th birthday. The new generation communicates primarily through social media.

Another metaverse-related study concluded that a broad majority of Gen Z, and even millennials are engaging activities within the digital environment. Half of the respondents said that they socialise with friends through online gaming. That is different from how older generations used to socialise in the physical world

Interestingly, although the survey stated that millennials buy more cryptocurrencies or NFTs than Gen Z, the younger generation expressed their desire to shop within the metaverse.

Brands in the Metaverse

For decades, companies and retailers have capitalised through economies of scale. Currently they may have to accept a two-track and consumer-oriented model; the first relating to scale and mass consumption, and the other for customization catering to specific groups of consumers.

Many brands have been leaping into the metaverse since it has been forecasted as the future of social media providing another reality where users can socialise, play and exchange transactions. For brands, this is a huge opportunity to monetize, build up a wider customer base and set their digital footprints. Many brands are seeking to find out what the metaverse can do for their brands and how to reach a bigger audience.  

Considering that Gen Zers are the majority of the metaverse population, brands are seeking to adopt new strategies to approach them. The number of studies and surveys on Generation Z are doing exactly that. Generational cohorts give researchers a tool to analyse changes in views over time. In this way, they can provide a manner to understand how divergent formative experiences interact with the life-cycle process such as technological and social shifts. Such data is valuable for brands to realise how to interact with a particular generation.

A recent survey of 4,600 business and technology leaders conducted by Accenture showed that 71% of executives believe that the metaverse will have a positive impact on their company, yet only 42% of them stated that it will be a major breakthrough.

One of the most basic manners that brands can get started in the metaverse is by taking full advantage of the gaming industry, either by partnering up with video games developers or even creating their own video games within the metaverse.

How can Gen Z connect with brands in the metaverse?

Playing games in a virtual world and socialising with friends online were the most popular experiences that consumers were interested in within the metaverse. A worldwide February 2022 survey found that Gen Z and Millennials were generally most interested in metaverse activities.

Virtual concerts of a favourite musical artist were another potential activity that users were extremely or at least very interested in, with 37% of Gen Z and 38% of millennial online users stating so.

After discussing studies on Gen Z main traits and their main conduct within the metaverse, let's take a look at how they shop.

An experimental e-commerce platform with virtual stores in the metaverse, Obsess, created a study to examine customer perspectives on shopping. In relation to Gen Zers, the consumer survey discovered that 75% of them have purchased a digital asset within a video game at least once.

Furthermore, 41% of them think that metaverse shopping options give customers a convenient environment to buy digital items and tangible assets that can be used in the physical world. 

Gen Z gamers prefer gaming content that has good social features, interacting with other Gen Z consumers on online gaming community sites

The data indicates that the majority of youth wants to be able to reach their favourite brands and products anywhere in the online environment. Growing up with online video games, social media and esports, young consumers are open to the idea of a modern-day shopping mall placed within a virtual world where they can shop and socialise.

Can Gen Z and brands connect through gaming?

Since most Gen Zers consider themselves gamers, connecting through gaming sounds as a reasonable strategy for a brand to pursue. Nearly two-thirds of Gen Zers who have heard of the metaverse think of it as the future of e-commerce and stated they will be open to transacting within it once digital avenues become accessible. 

Gen Z gaming and Gen Z gamers

We already know that most Gen Zers spend their free time playing video games. If you need a good practice example, take a look at Roblox and Fortnite. These online gaming platforms are at the forefront of the revolution. A good reason for this is that the online gaming environment already has all the technology and infrastructure needed to host events with many people and a built-up customer base. In other words, they are in a good position to capitalise on new forms of interactions.  

Taking all these findings into account, it actually makes sense that gaming and the concept of metaverse go hand in hand. Most marketing efforts related to the new generation, their main activities and the metaverse could easily fit into definitions of Web2, such as centering around multiplayer video games that have already been with us for years. This is particularly important today because true Web3 applications are still rare and limited to early adopters.

For example, Roblox is an established video game platform with a user base adding up to 52 million daily active users. It would be a challenge to find a single Web3 app with a fraction of those numbers.

Whether the metaverse will be a major breakthrough or not, it cannot be denied that most of Gen Z is already there and actively participating. Being in virtual spaces seems almost as home to the new generation.

Another point that can be highlighted here is that for them, gaming is the norm that brought them to the metaverse. Brands should focus on meeting the new generation exactly where they are now – playing games in the metaverse.

It is a fascinating time to be alive – while a bunch of young people have dived into the metaverse to play video games, socialise and even date, some other generations cannot even understand the concept.

We may refer to this phenomenon as a knowledge gap in which the use of digital technologies has taken its toll. Innovative technologies have been keeping us on our toes constantly. Those that can’t keep up, easily lose track of what is happening. That’s the thing with metaverse – many people still cannot understand its meaning, purpose, and use. However, the truth is that money is being spent in the metaverse. 

Generation Z (also known as Gen Z/Gen Zers) refers to the generation born in 1997-2012 following the millennials. Gen Zers were practically born and raised online so it is not out of the ordinary that they represent 60% of metaverse users. Growing up in times of rapid technological advancements made them easily adaptable to such virtual spaces. In this blog post you will learn about Generation Z, their main characteristics and how brands can use their large presence in the metaverse to connect with them and the other way around.

What is Generation Z (Gen Z)?

Let's start with a few words about Generation Z. The generation that came after millennials (people born from 1981 through 1996) represents the youngest, most ethnically different generation in American history with 27% of the population. Being raised in the midst of technological innovations, internet and social media, this generation has frequently been stereotyped as addicts to technology and/or anti-social. The 2000s saw the youth becoming more introverted in real life, but the trend didn't follow up on the internet. Tech savvy new generations are moving their social life to virtual space.

Before calling out Gen Zers for being tech addicts, we should keep in mind that technology is a generation shaping consideration. For decades, technology had a big impact on how people communicate and interact. For instance, Baby boomers grew up in times of television expansion and that had an impact on their livelihoods and connection to the world. Millennials have led older generations in technology adoption and embracing digital innovations. The term metaverse came into existence prior to the birth years of generation z. Namely, the term was coined in Neal Stephenson's 1992 science fiction novel Snow Crash, where humans in the form of programmable avatars, interacted with each other and software agents within a three-dimensional virtual space that closely resembles the real world. Many years later, the Gen Zers claim they feel more like themselves in such a digital environment.

While it is not alright to generalise, a few recent research can provide us some insight into the main traits of Gen Z. Razorfish and VICE Media Group research on Gen Z gamers brought to the table some interesting acknowledgements about these young people, their habits and perspectives. Namely, Gen Zers in the metaverse have been six times more likely to describe themselves as introverts as opposed to extroverts. Half of them stated that they felt more like themselves in the metaverse as opposed to real life. Furthermore, 65% of Gen Zers claimed that online relationships are just as meaningful as real-life ‘offline’ relationships are. And lastly, many respondents stated that gaming enhanced their mental health.

The research brings up the conclusion that Gen Z spends more time within the metaverse, and more importantly, develops meaningful connections to the idea of online identities. The purpose of the findings was to help brands to connect with this generation within the metaverse and through their top activities such as gaming. 

The results of this study are in line with another one conducted by Deloitte in 2021. More than two thirds of respondents stated that they considered themselves games as opposed to millennials or Generation Y whose number one hobby turned out to be watching tv shows or movies. Post millennials still love to binge watch television but that's a fifth-place hobby to them. Additionally, in contrast to previous generations, Gen Zers prefer streaming services to traditional cable and getting content down on their cell phones. The average Gen Z got their first smartphone just before their 12th birthday. The new generation communicates primarily through social media.

Another metaverse-related study concluded that a broad majority of Gen Z, and even millennials are engaging activities within the digital environment. Half of Gen Z respondents said that they socialise with friends through online gaming. For example, that is different from how older generations used to socialise. Namely, previous generations socialised specifically in the physical world. Even though the survey stated that millennials buy more cryptocurrencies or NFTs than Gen Z, the younger generation expressed their desire to do shopping sprees within the metaverse. 

Why should a brand get in the Metaverse?

For decades, companies and retailers have capitalised through economies of scale. Currently they may have to accept a two-track and consumer-oriented model - the first relating to scale and mass consumption, and the other for customization catering to specific groups of consumers. Many brands have been leaping into the metaverse since it has been forecasted as the future of social media providing another reality where users can socialise, play and exchange transactions. For brands this is a huge opportunity to monetize, build up a wider customer base and set their digital footprints. Many brands are seeking to find out what the metaverse can do for their brands and how to reach a bigger audience.  

Considering that Gen Zers are the majority of the metaverse population, brands are seeking to adopt new strategies to approach them. The number of studies and surveys on Generation Z are doing exactly that. Generational cohorts give researchers a tool to analyse changes in views over time. Namely, they can provide a manner to understand how divergent formative experiences interact with the life-cycle process such as technological and social shifts. Such data is valuable for brands to realise how to interact with a particular generation.

A recent survey of 4,600 business and technology leaders conducted by Accenture showed that 71% of executives believe that the metaverse will have a positive impact on their company, yet only 42% of them stated that it will be a major breakthrough. One of the most basic manners that brands can get started in the metaverse is by taking full advantage of the gaming industry, either by partnering up with video games developers or even creating their own video games within the metaverse.

How can Gen Z connect with brands in the metaverse?

Playing games in a virtual world and socialising with friends online were the most popular experiences that consumers were interested in within the metaverse. A worldwide February 2022 survey found that Gen Z and Millennials were generally most interested in metaverse activities. Virtual concerts of a favourite musical artist were another potential activity that users were extremely or at least very interested in, with 37% of Gen Z and 38% of Millennial online users stating so.

After discussing studies on Gen Z main traits and their main conduct within the metaverse, let's take a look at how they shop. An experimental e-commerce platform with virtual stores in the metaverse, Obsess, created a study to examine customer perspectives on shopping. In relation to Gen Zers, the consumer survey discovered that 75%of them have purchased at least once a digital asset within a video game. Furthermore, 41% of them think that metaverse shopping options give customers a convenient environment to buy digital items and tangible assets that can be used in the physical world. 

Gen Z gamers prefer gaming content that has good social features, interacting with other Gen Z consumers on online gaming community sites

The data indicates that the majority of youth wants to be able to reach their favourite brands and products anywhere in the online environment. Growing up with online video games, social media and esports, young consumers are open to the idea of a modern-day shopping mall placed within a virtual world where they can shop and socialise.  

Can Gen Z and brands connect through gaming?

Since most Gen Zers consider themselves gamers, connecting through gaming sounds as a reasonable strategy for a brand to pursue. Nearly two-thirds of Gen Zers who have heard of the metaverse think of it as the future of e-commerce and stated they will be open to transacting within it once digital avenues become accessible. 

Gen Z gaming and Gen Z gamers

We already know that most Gen Zers spend their free time playing video games. If you need a good practice example, take a look at Roblox and Fortnite. These online gaming platforms are at the forefront of the revolution. Namely, the online gaming environment already has in store all the technology and infrastructure needed to host events with many people and a built-up customer base. In other words, they are in a good position to capitalise on new forms of interactions.  

That said, it actually makes sense. Gaming and the concept of metaverse go hand in hand. Most marketing efforts related to the new generation, their main activities and the metaverse could easily fit into definitions of Web2, such as centering around multiplayer video games that have already been with us for years such as Roblox and Fortnite. For example, Roblox is an established video game platform with a user base adding up to 52 million daily active users. Namely, true Web3 applications are still rare and limited to early adopters.  

Whether the metaverse will be a major breakthrough or not, it cannot be denied that most of Gen Z is already there and actively participating. Being in virtual spaces seems almost as home to the new generation. Another point that can be highlighted here is that for them, gaming is the norm that brought them to the metaverse. Brands should focus on meeting the new generation exactly where they are now – playing games in the metaverse. 

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