Insights Shakeout: 6 Trends Shaping Generation Alpha

Generation Alphas (kids born after 2010) are already influencing consumer behaviour in radical ways. Born into a world where intelligent devices and high speed data have blurred the boundaries between physical and digital, Gen Alphas are tech-empowered and opinionated. They’re weighing in on what their families eat, where they shop and how they travel. This global trend is also being shaped by millennial parents who are involving kids in their decision making (more so than previous generations).

Many of the trends we’re observing also hold relevance for the rest of us subject to identical technological and cultural shifts. We’re going to shed some light on the themes to watch out for in technology, culture and spending behaviour, and examining how brands can be better positioned to capture the future.

Real-Time Relevance

  • 4 out of 5 Gen Alpha kids significantly influence family purchases
  • $500 billion+ in purchases are influenced by children under the age of 12 
  • 46% of US and UK kids under 16 have direct access to an Amazon Prime account, and it’s their favourite place to spend money

1. Hey Google is It Ok If I Eat You? 

Voice interfaces are here to rival screens, and Gen Alphas who have spent their childhoods chatting up voice assistants Siri and Alexa, or voice-activated speakers and in-home robots are increasingly using voice in their online interactions. Some asked toy robot Cozmo if it could jump or open doors, others offered the devices food or asked, “Is it OK if I eat you?”.

As Gen Alphas and the rest of us internalise voice, we will need to reconsider how brands are discovered and experienced. Proctor & Gamble, for example, made the most of Alphas’ Alexa chops with a smart-speaker toothbrush tie-in for Crest Kids that uses songs, jokes and trivia to get kids brushing for the right length of time. But voice is part of a larger trend that brands will need to capitalise on. 

2. Reality that’s Augmented and Ownable

Young consumers are already accustomed to augmented reality on social platforms like Snapchat, and this technology is likely to become ubiquitous. Both Apple and Google have their own AR platforms for developers to work with. Disney, Nike, Sephora, Toyota, Lacoste, Tesco, Converse, Zara, IKEA and MTV are all utilising AR to embed smart interactive content into their products and immerse consumers in a world where it’s possible to experiment with styles and try out products in virtual environments. The 5G rollout in China is playing a part in speeding up adoption, faster data makes it possible to stream VR and AR data from the cloud without bulky viewing devices. For more on 5G in China, check out recent piece on Chinese Consumers (Post Covid).

8 Things To Know About Chinese Consumers (Post-Covid) – Part 1/2

Beyond brands, AR and VR are finding use in education and healthcare. Immersive learning technologies are being employed in schools for everything from practicing soft skills to helping ADHD students read in a distraction-free, virtual space. Since the pandemic, new applications have emerged — opportunities for kids to travel and experience places they otherwise cannot. In healthcare, these technologies are helping medical professionals diagnose and treat Covid-19 and Alzheimer’s, manage PTSD, administer remote physical therapy, and overcome barriers to healthcare delivery.

3. Everyone as a merchant, every device set up to pay

Gen Zs and their successors have come to expect a level of ease in their buying activity that extends well beyond product selection. This is true not only in developed Asian markets like Hong Kong and Singapore, but also in Southeast Asia — fast emerging as the world’s next market for e-wallets and digital consumer finance. With high digital penetration and engagement (even higher now post-pandemic), Vietnam, Malaysia, Thailand and Indonesia are seeing rapid adoption of e-wallets similar to China from a couple of years ago. To succeed in these markets, brands will need to focus on skipping steps in the traditional customer journey, and remove points of friction in digital payments — to meet the enormous unmet needs of the “unbanked” urban segment.

Digital wallets to become the gold standard of payment

Point of Need, Not Point of Sale

As it gets harder to reach consumers in the usual places — out-of-home, point-of-sale or digital ads, brands are already moving closer and addressing them at their point of need: when they ask Google or Alexa for breakfast ideas or while they’re sharing their views on social.

And how do you meet a Gen Alpha customer at their point of need?

“Alexa, what can I do with the kids at home?” asks the frazzled millennial parent in lockdown. Alexa has ready answers. Freeze Dancers. Sesame Street and Headspace. Disney Stories. While brands struggle to reach Gen Zs and post Gen Zs via conventional advertising, the savviest players have moved from targeting at point of sale, to point of need. And how do you meet Gen Alphas at their point of need? With an AI assistant of course.

4. When AI loyalty trumps brand loyalty

Experts predict a move towards AI platforms, when we use just one assistant across our homes, cars, and mobile devices. The more we use AI in decision-making, the better it understands our habits and preferences, and the better it meets our needs — building loyalty in a positive feedback loop. Shopping for daily essentials, groceries, cellphone plans, insurance plans — AI is better equipped to sort through a universe of available options, filtering by criteria and proposing products based on our preferences. It’s easy to see how we can come to rely on AI to automate our purchases just as we’ve come to automate electricity and water.

Where does this leave brands? If AI fulfils consumer needs, ensures quality, and consistently puts our interests first, brands will need to rethink their consumer strategy, and understand and influence these platforms to win.

AI platforms of the future will transform how brands connect with customers

5. New/Old — More Transparent, More Inclusive… And More Analog?

We’ve covered Generation Z’s socially responsible mindsets and advocacy in our earlier piece. But Generation Alphas take this a step further. Alphas will be the most racially diverse generation in history. In 2020, less than half (49.8%) of children in the US will be non-Hispanic whites. Elsewhere across the world, Alphas are also more likely to be raised in non-traditional households — with single parents, unmarried parents, mixed-race parents or same-sex parents. In Asia, family sizes are shrinking in some economies with more mothers opting to work outside their homes. With their unique childhoods, Alphas have come to expect inclusivity and transparency in digital messaging. Much like previous generations, they’re also gravitating towards newer social media platforms to avoid the prying eyes of their millennial parents, and brands will have to stay nimble to keep up.

An interesting survey of 2,000 UK kids and their parents by a leading UK kids’ consultancy revealed that Gen Alphas are not only more progressive when it comes to gender, sexuality and social identity, they’re also more old fashioned than their Gen Z counterparts, valuing family time and time outdoors, over devices.

The New Old Fashioneds

6. Know Thy Maker: How Millennial Parents are Shaping Gen Alpha

Our final stop. Millennial Parents. They’re not all alike. Millennial parents are as diverse a demographic as the countries they come from. Even within developed markets like Hong Kong and Japan, there are noticeable differences in lifestyle. For example, 79% of Hong Kong millennial mothers work full time, while only 27% of Japanese millennial mothers do. Across Asia Pacific, a diversity of incomes, education, and technological access are shaping various aspects of Gen Alpha lifestyle and behaviour. In order to successfully connect with this audience, marketers need to understand the differences as well as the similarities between them. What do they have in common? Millennial parents are far more likely to turn to YouTube and online platforms for guidance on parenting. They are far more ready to engage with brands online than parents of previous generations. Millennial parents are breaking down gender stereotypes, pursuing their careers and passions, and being “real” with their kids. Marketing successfully to millennial parents means reflecting their lifestyles and priorities back at them.

Final word — Tread lightly. Tread boldly.

Before creating marketing campaigns to sell to Gen Alpha, though, consider legality. Amazon has come under fire for targeting kids with its platforms. Google and YouTube paid a record $170 million FTC settlement for collecting personal information from children without their parents’ consent. 

For brands, it’s important to note that generational boundaries are fluid and discretionary. Members of Generation Alpha are not born inherently different to Millennials or Generation Z, but their preferences, impulses and viewpoints will be coloured by their environments. What is unmistakable though, is that a world in upheaval and greater access to technology is transforming thinking and doing; speeding up adoption of voice and AI, and opening up conversations around inclusivity and digital transparency — for Alphas, just as the rest of us.