Generation Alpha: The Next Customers for Your Business
6 min read
Share
Just when you'd gotten used to Gen Z, along comes Gen Alpha. What do the youngest people on earth have in store for the world, and why does your business need to know about them now?
The Generation Recap
From the generation of the Baby Boomers to Gen X, Gen Y to Gen Z, and the latest cohort, Gen Alpha – just who are these different groups, and what can we tell about people from when they were born? Well, more than you might think. And although these definitions are painted with a broad brush, they can spot trends among wider populations, and opportunities for e-commerce retailers to tap into new markets with new products, marketing methods, and ways to pay. Here’s how Pew Research1 defines them:
Baby Boomers – born between 1946 and 1964
Gen X – born between 1966 and 1980
Gen Y/Millennials – born between 1981 and 1996
Gen Z – born between 1997 and 2012
Gen Alpha – born from 2013 onwards
So, to Generation Alpha
“Gen Alpha is the next step beyond digital native. Their understanding of what it means to be connected to other people, what it means to own something and use pieces of your own experience to create something entirely new will result in a group of young people unlike any we’ve seen before – they will be completely untethered to time, space, location or people.”
Dr. Thalia R. Goldstein, George Mason University
According to Mark McCrindle, the Australian demographer who coined the term ‘Gen Alpha’, more than 2.5 million members of this cohort are born each week2. That means there could be two billion of them by 2025, and they are predicted to be the most innovative, creative, and digitally-savvy group of youngsters yet. No pressure then, kids.
What do we know about Gen Alpha?
Well, a characteristic of Gen Alpha is that 24% of them spend more time with friends online than in person3. They have learned to build relationships with people from around the world from a young age, and are routinely exposed to diversity in the media and in real life, helping them shed race and gender stereotypes. They are often the children of Millennials, 76% of which use smart devices to keep their children safe and well behaved4.
In a survey of 8,000 Gen Y parents around the world with children aged four to nine, 65% said the habits of their children influenced their last purchase, rising to 81% among parents in the USA5. Tech, it seems, is at the heart of many Gen Alphas’ existences. Let’s explore this more.
How tech impacts Gen Alpha’s lives
In 2018, a seven-year-old named Ryan earned US$22 million for simply playing with toys. Sounds like a dream, right? Well, thanks to his YouTube channel6, where he’s gained more than 21 million subscribers, the Texas native has become a bona fide icon for the youngest generation. Not bad for someone whose age, even now, isn’t into double digits. And while Pew Research might place him in the bottom bracket of Gen Z, he’s exactly the type of influencer that Gen Alpha are already following.
Due to all the digital exposure they’re getting, the majority of Alphas will learn to use a touch screen as toddlers – and, more likely, will surpass their parents’ knowledge of tech by the time they’re eight7. Unafraid of learning by discovery or interacting with AI (although there are issues around how well voice assistants understand kids), these habits are being recognised (and used) by brands to connect with this young generation. P&G, for example, has sponsored Chompers – a two-minute podcast that encourages kids to brush their teeth8. Smart? Absolutely. Cynical? Maybe.
Although Alphas are exposed to digital media constantly, their desires are not solely driven by what they see on screens. In fact, they show some traits that might seem a little more traditional. 36% of Gen Y parents say their kids are influenced by their friends’ possessions and behaviors – no shocks there – while 22% say ads have an impact, and just 14% cite online personalities as having an influential role9.
Just under three-quarters (73%) of Alphas think it’s important to question what’s presented to them online, while 31% believe they know how to spot fake news – a concern Google has addressed by making ‘Don’t Fall for Fake’ a key topic in its Be Internet Awesome curriculum10, which aims to teach kids the skills they need to be safe online. Basically, they know what they like, and and can see through inauthenticity online.
Identity in Gen Alpha
An interesting study from Beano Studios found that 58% of under-10s believe gender to be irrelevant, whilst an astonishing one in five kids aged 5-9 have been on a march or protest concerning causes they care about11. Being predominantly the children of Millennials, this could be their parents’ opinions being projected, or evidence that attitudes around the world truly are changing.
Brands have started to respond to Gen Alpha’s views on identity, creating gender-neutral clothing and toys to appeal to the changing clientele. Abercrombie & Fitch, John Lewis, and Target12 all have neutral ranges, with the latter having disposed of its pink and blue toy aisles already back in 201513. Toys ‘R’ Us, Walmart, and Kmart have since followed suit, and a couple of years ago, the Toy Industry Association abolished its ‘girl toy of the year’ and ‘boy toy of the year’ awards – moving towards a more inclusive, welcoming space14.
“We look at our brands more inclusively than ever. We don’t care who [the buyers] are, we just care they love the brand.”
Brian Goldner, Chief Executive of Hasbro
The Gen Alpha Opportunity
Though it’s impossible to accurately predict what Alphas will be like as adults, their impact on consumer behavior is currently being felt through their parents, who of course, respond to the preferences and needs of their children in purchase decisions. Like their mothers and fathers before them, it seems that they are likely to want personalized products that use technology, adapt to their changing needs, and are available on demand15.
“The business world is going to be confronted with the most demanding customers and employees in history, expecting speed, responsiveness and customization as a standard. It will be a tougher job to win the attention and loyalty of consumers, and much more likely that established brands will be ditched.” - Joe Nellis, Professor of Global Economy, Cranfield University
As many Alphas are too young to read and write, screen interfaces and voice-activated tools are essential to connecting with them16 – well, the ones that have been born already. Augmented reality (AR) is also being used to bring traditional entertainment channels into the 2020s. Lego, for example, now has an app with AR capabilities, and there are similar offerings for much-loved literary characters such as the Gruffalo and the Very Hungry Caterpillar17.
Beyond the screens, this group already seems better placed than their Gen Z peers to prioritize physical play and use technology in moderation. In a bid to boost real-life activity (and sales), Nike has launched its Adventure Club18 – a subscription shoe service for children aged 2-10 that delivers Nike gear to their door, alongside adventure guides, outdoor games, and activities for families to try out together.
Generation Alpha are still finding their way in the world, or even their way into it, but how they see it, react to it, and shape it will surely be unlike any generation before them. Tech is second nature, boundaries are more blurred than ever, and collaboration is at the forefront of everything. If you’re building for the long term, you can’t afford to forget about them – they may be your best customers yet.
Share
Similar Stories