Generation Z, often referred to as Gen Z, has emerged as a powerful force in the mobile app economy, reshaping the landscape of app spending trends. The spending of Gen Z in the US amounts to $44 billion every year, which is why so many businesses are shifting their focus towards this high spending group of consumers. They are the first generation to grow up in a digital world and their mobile app usage reflects their unique preferences and behaviors.
In order for app marketers to thrive in the ever-changing landscape that is the mobile industry, they need to focus on the trends that resonate with these young users. Understanding who the Gen Z audience is and what their motivations are will not only help apps develop a strong user base, but exceed revenue goals as we enter the last months of the year.
Who is Gen Z?
Gen Z’ers are also known as “digital natives”. They are the first generation to grow up with the internet as a part of daily life and because of this, have a higher tendency to be early adopters of newer technologies. Currently, this generation spans a wide range with the oldest Gen Zers having jobs and mortgages, while the youngest are still preteens. This widespread age range can make catering to this range of users tricky, which is why marketers need to take a deep look into which Gen Z’ers may make up more of their target audience.
How to Win Over Gen Z’s in 2023
Winning the attention of Generation Z for mobile app engagement can be a challenging yet rewarding endeavor. Over 32% of Gen Z transactions happen on a mobile device, which makes mobile marketing a highly impactful investment for brands. Gen Z is a tech-savvy, discerning audience that values authenticity, convenience, and personalized experiences. Since they are a generation of digital natives, they expect flawless execution when it comes to their mobile experience.
Marketing to a Mobile-First Generation
Gen Z is a mobile-first generation, meaning they are more likely to use smartphones as their primary device for various activities, including shopping, entertainment, and social interaction. This reliance on mobile devices has led to a significant increase in mobile app spending. Gen Z consumers prefer apps that offer seamless and user-friendly experiences, with a strong emphasis on aesthetics and usability.
Over 60% of Gen Z-ers will not use an app or website that is too slow to load. Making sure that an app’s priority is focused on a user-first design will increase the retention rates of these young users. App developers can prioritize user experience by ensuring that their app is intuitive and easy to navigate. By using clean, modern design elements and a visually appealing interface, apps can ensure that they maintain the attention of this prized group of users.
Utilizing In-App Purchases
Gen Z is known for its willingness to spend within mobile apps. They are avid consumers of in-app purchases, such as virtual currencies and other digital goods in mobile games and social networking apps. This trend has boosted the freemium subscription model, where apps are free to download but generate revenue through in-app transactions.
The freemium model encourages young users to try out the app without any upfront cost, reducing the barriers to entry and increasing the chances of users downloading and engaging with the app. By offering a basic version for free and monetizing through in-app purchases, subscriptions, or advertising, developers can generate a steady stream of revenue while giving users the flexibility to choose the extent of their investment, enhancing user satisfaction and loyalty. Getting creative with the types of in-app purchase options will keep the Gen Z audience entertained and engaged with the app. Boosting levels with purchase of rewards or tokens is a great way to gamify an app and make sure users are remaining loyal.
Double Down on Premiums
Gen Z values premium experiences and customization, which has driven the popularity of subscription-based apps and services. Streaming platforms such as Netflix, Spotify, and Disney+ have witnessed a surge in Gen Z subscribers. This generation is willing to pay for premium content, ad-free experiences, and exclusive features.
Gen Z's willingness to pay more for premium content can be attributed to their discerning tastes and the unique benefits that come with premium offerings. They place a high value on quality and authenticity, and they perceive premium content as a reflection of those values. They are willing to invest in premium services because they appreciate the superior production values, ad-free experiences, and the convenience of personalized content recommendations. By offering premium experiences within an app, marketers can leverage Gen Z’s love for a high end mobile app experience.
Gen Z Interactivity within an App
Making sure that an app has a high level of interactivity and personalization is extremely important when thinking about Gen Z retention. In-app communities and chat rooms are highly appealing to this audience. By creating a community within the app where users can connect, share, and discuss common interests, marketers are ensuring a higher in app engagement rate.
Interactive ads also resonate particularly well with a Gen Z audience due to their engagement-driven nature and Gen Z's preference for active participation in digital experiences. Unlike traditional static ads, interactive ads invite users to become part of the content, allowing them to interact, make choices, and shape their own ad experience.
Gen Z values authenticity and authenticity, and interactive ads align with these preferences by offering a more immersive and personalized interaction. They enjoy the sense of agency and control that interactive ads provide, making the experience more enjoyable and memorable. Additionally, interactive ads often provide immediate feedback or rewards, creating a sense of gratification that can enhance brand engagement and leave a lasting impression on Gen Z consumers, ultimately making them more receptive to the advertised product or service.
Changing Technology and Preferences
It's important to note that mobile app spending trends can evolve rapidly due to technological advancements and changes in consumer behavior. As Gen Z continues to mature and influence the digital landscape, businesses and app developers will need to stay attuned to their preferences and adapt their strategies to cater to this influential demographic.
Takeaways of Gen Z Mobile App Spending Trends
Understanding who the Gen Z audience is and what their motivations are will not only help apps develop a strong user base, but exceed revenue goals as we enter the last months of the year.
- Marketing to a Mobile-First Generation: Gen Z is a mobile-first generation, meaning they are more likely to use smartphones as their primary device for various activities, including shopping, entertainment, and social interaction. This reliance on mobile devices has led to a significant increase in mobile app spending.
- Utilizing In-App Purchases: Gen Z is known for its willingness to spend within mobile apps. They are avid consumers of in-app purchases, such as virtual currencies and other digital goods in mobile games and social networking apps.
- Double Down on Premiums: Younger users enjoy premium experiences and customization, which has driven the popularity of subscription-based apps and services. Streaming platforms such as Netflix, Spotify, and Disney+ have witnessed a surge in Gen Z subscribers. This generation is willing to pay for premium content, ad-free experiences, and exclusive features.
- Interactivity within an App: Making sure that an app has a high level of interactivity and personalization is extremely important when thinking about Gen Z retention. Interactive ads also resonate particularly well with a Gen Z audience due to their engagement-driven nature and Gen Z's preference for active participation in digital experiences.
