COVID-19’s Impact on the Journey to AdulthoodNeeds and Concerns of Generation Z

May 2020

Gen Z and COVID-19

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As many states are in the process of executing reopening strategies, these are indicators of a shift into an uncertain phase of recovery marked by a need for adaptability. While many reports have focused on how brands can connect marketing and brand actions with the needs of society at large, this resource takes a nuanced look at how the pandemic has affected the youngest consumer cohort. With their high standards around brand purpose, understanding this generation's needs and expectations during the pandemic is crucial to future brand success.

Gen Z (1996 - 2010) has now surpassed Millennials in size, making up 32% of the global population with roughly $221B in buying power.1 Though Gen Z spans the ages of 10 to 24, we’ve chosen to focus on 16- to 24-year-olds specifically due to the unique nuances of their life stages. These kids are growing up; before the crisis, 23% were employed full-time and 19% part-time. Nearly 25% are married or partnered, and 11% have children under 18 in the home. While they are the generation with the most optimism in the economy’s ability to recover post-pandemic, more than 50% are still unsure or pessimistic.2

This report uncovers the distinct concerns of this group through the lens of how brand marketers need to approach them broadly, as well as offer guardrails for ideation on how to address these specific needs.

1 Gartner Gen Z in 20202 McKinsey & Company Survey: US consumer sentiment during the coronavirus crisis

Understanding Mindset Is the Key to Connection

Gen Z and COVID-19

How Gen Z Interacts with Your Brand

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This is your toolkit, a framework that depicts the way you should think about every action your brand takes, from business ideas to marketing ideas. Each touchpoint stems from the core idea — what we call a red thread — at the center of your brand. As you think about addressing the needs of Gen Z on the following pages, think about what it is that drives your brand, and how that plays out in every interaction a Gen Z employee or consumer has.

This spectrum serves as a framework for two distinct things: 1. How your brand should be thinking about addressing the needs

of Gen Z in every action it takes. 2. Where you may find areas where Gen Z currently interacts

with your brand as well as opportunities for further engagement.

In order to effectively apply whole brand thinking to your business and marketing decisions, consider the nuanced needs of Gen Z. To do this, we’ve broken this group up by life stages:

01 High School 02 Post-High School 03 College 04 Graduating Class 05 Graduated - Working

In the pages that follow, we break down these life stages by defining qualities, what their concerns are as a result of COVID-19, and specific needs that brands can address.

The intention of this document is to give insight into the ways COVID-19 impacts Gen Z in order to identify needs that brands can ideate solutions around. When thinking about meeting these needs, start with the Whole Brand Spectrum:

Gen Z and COVID-19

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01 High School Growth in Identity

High school functions as a learning place for the building blocks of life. Academically, core skills are acquired between grades 9-12 with the goal of producing functioning members of society at the most basic level. Socially, it’s where young teenagers figure out who they want to be in the hierarchy of status and learn about social positioning. While those entering high school (ages 14-15) have a different set of specific needs than those about to graduate (ages 17-18), we’ve taken a holistic look at the high school experience during the pandemic.

For 16- to 18-year-olds specifically, high school is where one begins to test personality traits and expressions of identity against people who are in similar growth and discovery phases. When schools closed, technical concerns with the transition to online learning was overshadowed by the loss of social expression.

It’s worth noting for this group specifically that school closures disproportionately affect low-income students. For this group, schools represent necessities in life outside of preparation for the next phase. There is a real opportunity for brands to make a difference with this affected group.

Concerns NeedsCollege

• Will I qualify/be able to get into a good/my favorite college?

• Should I stay close to home? • Do I need to worry about the ACT or SAT?

Will there be a new process to apply for school?

• Can I visit campuses?

Difficulties switching to remote learning • Do I have access to help when I need it? • Am I able to maintain essential social

connections with teachers, counselors, mentors, social groups of people like me?

If I don’t get a traditional prom or graduation, how will I celebrate? Did the effort I put into school even matter now?

Is my summer job going to be there? Babysitting - lifeguarding - food service. Will I still be able to gain experience?

Low-income specific needs

• Access to meals/supplies (books, materials, etc.)

• Access to technology (for distance learning) • Additional academic support

• A sense of safety and control • Infrastructure for socializing (talk to and

learn from someone who understands) • Core skill development (conflict

resolution, communication, job skills, etc.)

Missed milestones (Prom, Graduation, Spring Break)

• Transitional experiences for those graduating • Shared sense of pride for the work/experience

gained • Sense of progress • Sense of accomplishment

Shared sense of identity

Gen Z and COVID-19

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02 Post-High School Seeking Exploration

Not everyone enters directly into college after high school, or chooses to go at all.

For this group, the time after high school is often for exploration: of the self, the world, what you think and believe. While COVID-19 has cancelled travel plans, many within this group have more time than ever before to explore places within themselves. Gen Z already had questions around the value delivered by higher education against the cost of attaining a four-year degree. With the impact of the pandemic affecting industries so differently, these questions have only become more abundant for those deciding what next steps they should take in life.

For the time being, typical summer jobs for this group (food service, hospitality, caregiving, etc.) are no longer options. While financial worries are a concern, the real effect of the virus on this group is having more time than they know what to do with. Jobs that were previously seen as stable have vanished, making entrepreneurship seem like a much smaller jump than it would have pre-pandemic. With a new sense of urgency and a shift in priorities, brands that can assist with identifying next steps in their period of exploration will win in building relationships with this group.

Concerns Needs

• Do I want to go to college? Does it hold the same value it once did? Would it be worth my investment? Should I consider trade or technical school?

• My summer job got cancelled, how will I make money? How do I find jobs that match my skills? How do I grow my skills? Should I start my own business? How would I do that?

• Is this a gap year? Should I be doing something specific now for my future? What is my purpose right now?

• Network connectivity — getting specific talents to businesses that need it

• A way to organize/track hours worked and budget

• Opportunity for placement in non-traditional roles

• Purpose - Make their skills useful toward a larger purpose (give them purpose or a way to be purposeful)

Gen Z and COVID-19

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03 College Learning of Independence

While formative identities are tested in college (and often, in new environments), the real practice in this life stage is really independence. This is the first time for many young adults that they will be living away from home. Even for those that choose to stay home, there are no family check-ins for the work they’re completing. For the first time in many young adults’ lives, nobody is going out of their way to ensure they’re successful. Each individual has to make the choices that will lead them to their set goals.

With the shutdown of college campuses, many students had to move back home, at times leaving their belongings behind. This group is faced with interacting with family in the role of child or sibling in addition to carrying out their roles of student as they were supposed to be learning how to be independent. Brands should look for ways to assist in growth toward independence when people may not actually be able to be on their own.

Concerns Needs

• Will I be able to pay for school? ◦ (Tuition? Loans? scholarships?)

• Will I be able to get a job when I graduate? Is my degree still valuable?

• Will I be able to get an internship?

• What do I do now that my internship was cancelled? Will I have enough credits to graduate?

• Will I get to have a traditional graduation? (sophomores/juniors)

• Will campus reopen? When will I come back to campus?

• Will I do well in my classes? (in my current home circumstances)

• How do I manage my own growth while my parents see me as a kid? How can I still feel like I’m an adult?

• Assistance paying for school ◦ Access to scholarships,

creation of a fund, etc.

• Network connectivity — mentorship and relationship building

• Opportunity to showcase skill building

• Substitution for internship ◦ Interaction with industry work ◦ Chance to practice skills

• Make goal-setting easy

• Assistance staying motivated

• Ways to practice independence in a familial setting

Gen Z and COVID-19

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04 Graduating Class Transition to Autonomy

For those newly graduated, the reward isn’t just an exit from school, but the entrance into the working world. Many students don’t look at working as a negative prospect, but as a prize they will win for the completion of a degree. The idea of being able to make money and move out on your own, making your own decisions and setting your own path is something many students look forward to.

For the graduating class of 2020, the transition they were planning on isn’t able to happen. The future is uncertain in a variety of ways and many within this cohort will have to delay the plans they’ve been making for over two decades. Industries have been affected in adverse ways due to the virus and this will negatively impact the immediate value of certain degrees (e.g., Hospitality, Aviation, ect.). These individuals are still faced with, often, large amounts of student debt, but suddenly their earning potential has been unexpectedly impacted. Many are having to delay personal autonomy for greater security in the short term and are wondering if they’ll still be able to accomplish their goals as planned.

Concerns Needs

• What companies are hiring right now?

• What does the job market of the future look like? (different for in-person vs remote work) What is my earning potential now?

• My skills have value but I can’t get a job — did I make the right choices? Will I be underemployed? Will that set me back in life? For how long?

• Will I make enough money to pay off my student loans?

• How can I be distinct in a hyper-competitive job market?

• Opportunity to showcase skill building

• Reassurance — sense of validation they made the right choices

• Opportunity for placement in non-traditional roles

• Ways to differentiate // continue building unique experiences to use as proof points in the career hunt

• Ways to increase autonomy ◦ Of their life path (job path / goal tracking) ◦ Of mental health (self-guiding tools) ◦ Of celebrations (how can I organize a substitute

for my transition from student to adult?)

• Missed milestones (Graduation, Spring Break, etc)

◦ Closing of a chapter that doesn’t get recognition ◦ Shared sense of identity with friends / bookending ◦ Shared sense of pride for the work / experience gained ◦ Sense of progress

Gen Z and COVID-19

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05 Graduated - Working Prosperity Building

For those that graduated and were able to land a job with remote capabilities before the COVID-19 shutdown, life hasn’t changed much past a lack of conveniences. Often, people within this group are focused on career advancement and there’s going to be an increasing lack of opportunities at the entry level as we have overqualified individuals competing for fewer roles.

While there are still negative aspects to this group's lived experience, their pre- to post-pandemic journey will remain fairly even when compared to other groups. For those in essential work, or who had a job and were let go as a result of the virus, their needs mirror those reflected in larger society.

Concerns Needs

• Are we in a recession? Will I still be able to climb the corporate ladder? What opportunities for upward mobility will continue to be available?

• Will benefit packages look the same / continue to be available to me? What effects will this situation have on my employer?

• What does my job security look like?

• Is my career establishment put on hold?

• Will I be able to save enough to support my future goals?

• Will I have to live at home longer than I planned for?

• Am I throwing myself into work too much? I don’t spend as much time talking to other people, do I have positive activities to take part in?

• Is there any way I can help? I feel so bad watching those struggling, I wish there was something I could do.

• Assistance in identifying and mapping the path to future goals

• Ways to efficiently leverage their privilege in helping others

• Positive activities to prevent overworking

• Ways of connecting with new coworkers, outside of work

Gen Z and COVID-19

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Getting Started 5 Guardrails for Ideation

With a greater understanding around situational impacts on Generation Z and distinctions between life stages, it’s time to start ideating around how to offer branded solutions. With so many life stages and possible needs to address, it can be tempting to try to solve everything, but a focused effort that resonates with your brand’s core idea — what we call a red thread — will have a larger impact than multiple less meaningful solutions. We wanted to offer these guardrails to assist you in discovering a solution that’s in line with your core:

• Your brand should not be trying to solve for every need. Look at your core offering and identify a specific need that you can attack to see if there are ways to pivot for a focused solution. Bonus points if you can fulfill a need better than other brands — play off of your differentiator and do what only you can uniquely provide.

• While many needs were identified within each age group, solving each need is not a one-size-fits-all approach. Your messaging has to be backed by brand action to resonate with Gen Z. Try looking for unique deliveries in communication to stand out from the noise of other messages.

• You don’t have to solve these problems alone. Look for ways to leverage existing causes (NGO’s, nonprofits, etc.) and activate stakeholders (teachers, principals, parents, coaches, trainers, counselors, etc.) in Gen Z lives when looking at delivering effective solutions.

• Empathy will be your superpower. Gen Z has gone through serious life changes and faces an ambiguous future. Empathy will be important if you want to create emotional connections as we all move through uncharted territory.

• Consider crowdsourcing solutions to the challenges you face. If Gen Z is already connected to your brand, they will likely engage to help offer ideas and potential solutions. If they aren’t, now may be an opportune time to reach out and begin building connections by showing a genuine desire to be useful.

Gen Z and COVID-19

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Brand LoveⓇ When You Get It Right

There are expectations from Gen Z around the types of actions that brands should already have been taking, and are the basis for their support. Many of these expectations surround COVID-specific needs, like ensuring employee safety, supporting local communities, and helping essential workers. Our POV has been that brands must move beyond being purposeful and move toward being useful during this time.

When a brand is able to meet consumer expectations as well as offer targeted solutions to meet the needs of Gen Z, it results in Brand LoveⓇ. There are typically two factors that influence this love, resulting in increased willingness to buy and better loyalty overall: consistency and spontaneity.

In order to increase Brand LoveⓇ, brands have a challenge to maintain consistency in delivering what consumers know them for, and expect of them during this unprecedented time. Additionally, brands must also be looking for ways to build new connections and relationships at a time where specific needs can be identified, as well as stand out from other businesses serving the needs of the larger society. To build a relationship with Gen Z, both factors have to be present. See the next page for examples.

Gen Z and COVID-19

Up-to-date COVID information and $100M toward small businesses

Closed, in-store dining and started contactless delivery

$250M to support front- line medical workers, educators and local communities

2020 Graduation:Oprah as commencement speaker

Play at home kits

All ages virtual prom

Expectation met: Community support

Expectation met: Employee protection

Expectation met: Essential worker support

Need met: Missed Milestones /increased autonomy of celebrations

Need met: Positive activities to prevent overworking

Need met: Ways to practice independence in a familial setting

Consistency

Spontaneity

Above all else, look to your red thread for guidance and let usefulness drive brand actions. Be consistent in your delivery of the core offering while moving through uncertain circumstances, but don’t forget spontaneous executions against serving people’s timely needs. This is what leads to success, and ultimately, a stronger relationship overall with Gen Z.

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Gen Z and COVID-19

Thank You!12

Co-authors Jeff Fromm - jfromm@barkleyus.com Katrina Chertkow - kchertkow@barkleyus.com Chad Nicholson - cnicholson@barkleyus.com

Sources  Interviewed Kieran Mathew Founder & CEO Amplify Solutions Inc. Michael Pankowski Harvard student, Crimson Connection

Referenced Gartner Gen Z in 2020 McKinsey & Company Survey: US consumer sentiment during the coronavirus crisis Brainly 5 Q qualitative survey to app users HelixaInterests and Insights Gen Z: All Grown Up Almanac The Unknowable The Sound Generation Edge Medium The Pulse of Gen Z in the Time of COVID-19 Adweek Covid-19 Is Changing Gen Z Consumer Habits. Here Are 5 Things Marketers Need to Know Gartner Snapchat to launch “Here For You” tool to ease younger users' anxiety AdAge A regularly updated list tracking marketers’ response to Coronavirus