The Customer Revolution - Part 2: Generation Z
By Paul Stockford, Chief Analyst, Saddletree Research
Posted in Customer Engagement
In my last blog, I wrote about the revolutionary changes facing the global contact center industry as a result of the expectations and requirements of the new generations of customers. My previous entry wrote specifically about the Millennial generation, roughly defined as those individuals born between 1981 and 1996. I invite readers to refer to my previous blog to gain a better understanding of Millennials as consumers and customers.
In this blog, we’ll take a look at Generation Z as customers and the impact they are expected to have on the contact center as they become a consumer force. Members of Generation Z, or Gen Z, are generally defined as individuals born in 1997 and later. Gen Z represents about 26.5 percent of the U.S. population and growing, making this generation the largest generation in the population.
Gen Z is the first digitally native generation, meaning that they have never known life without the internet. Having instant access to information, entertainment, and communication has impacted the expectations of Gen Z as both workers and consumers. If you make the assumption that Gen Z will be much like Millennials in terms of their preferences and expectations as consumers, you would be only partially correct. In some ways, you couldn’t be more wrong.
Similar to Millennials, Gen Z’ers believe that the customer experience is also a social experience. They are more than willing and able to share their customer experiences on social channels and having grown up on social media, Gen Z is very well-connected among peers and others. They won’t hesitate to vocalize and share any bad customer service experiences. Brand loyalty among Gen Z is almost non-existent. One bad service experience and they will likely be gone for good.
While Millennials will accept e-mail as a customer service channel as long as the turnaround is relatively fast, that isn’t true with Gen Z’ers. Gen Z has a strong preference for chat over e-mail, primarily because this generation has grown up living at digital speed. As consumers, they will expect an immediate response to their service needs. Secondary research indicates that, by virtue of their lives at digital speed, this generation has a relatively short attention span. Web chat and texting can operate within the parameters of an immediate response and are the preferred channels for Gen Z consumers.
Like the Millennials before them, Gen Z’ers will not have the patience to tolerate menu-driven self-service solutions such as traditional interactive voice response (IVR). Conversational self-service solutions such as AI-driven virtual assistants are rapidly becoming a necessity for contact centers determined to survive the shift in generational customer experience expectations.
On the other hand, Gen Z is much more like Baby Boomers than they are like Millennials when it comes to conversational customer service. Generation Z consumers will pick up the phone and call customer service much more quickly than will Millennial consumers, who will likely exhaust all other customer communications channels before finally turning to the telephone.
Interestingly, we may already be feeling the effects of the Gen Z willingness to use the telephone for a voice conversation rather than a text chat. In our 2019 survey of customer service professionals, which Saddletree Research conducts annually in conjunction with the not-for-profit National Association of Call Centers (NACC) at Middle Tennessee State University, we asked respondents if their volume of voice-assisted customer calls had changed in 2018. Their responses are in Figure 1 below.
Figure 1: Voice-Assisted Customer Contacts – 2018
Source: Saddletree Research
What we expected to see in response to this question was an overwhelming number of respondents claiming a decrease in calls due to the popularity of other channels. What we found was exactly the opposite – that call volumes are increasing. The argument could be made that aging Boomers are increasing call volumes but the same argument could be made that it is the Gen Z’ers beginning to positively impact call volumes and that this percentage will only go up in the future.
However you look at it, it cannot be argued that the contact center is going to have to change in response to evolving generational preferences. Those contact centers that choose to bury their collective heads in the sand and pretend things will still be the same are destined to fail. Those who embrace these changes and the technologies that will be required to accommodate them will be well-prepared for the new era in customer care.
This will be interesting to watch as it plays out in the next few years. Thanks!
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