Gen Z: Shaping the future of business

Generation Z, popularly known as Gen Z, is a term used to represent people born between the late 1990s and early 2000s. This demographic cohort presently accounts for approximately 30 percent of the global population. It is estimated that Gen Z will account for 27 percent of the global workforce by 2025.

The situation in Bangladesh is no different. It is a young country with a median age of around 28 years. Individuals aged 10 to 24 years, which includes a substantial portion of Gen Z, make up about 30 percent of the country's total population.

As this generation comes of age and enters the workforce and consumer markets, their distinct characteristics, values, and behaviours will significantly influence how businesses operate and engage with customers. Gen Z exhibits certain attributes that differentiate them from previous generations, such as Millennials, Generation X, and Baby Boomers. Understanding these attributes is crucial for businesses.

This generation is overwhelmingly tech-savvy; highly proficient in using technology and digital tools for communication, entertainment, education and shopping. This digital fluency shapes their preferences for instant access to information and services.

As this generation grew up at the peak of globalisation, they are very inclusive and value diversity. Gen Z is genuinely concerned about social issues like climate change, racism, inequality, etc. They tend to be very pragmatic and realistic as they have experienced economic uncertainty, political instability and global crises.

This generation appreciates collaboration and teamwork but authenticity and self-expression do matter to them as well. While they have relatively shorter attention spans caused by social media, it is because of the internet and social media that they are exposed to different cultures, ideas and lifestyles, leading to a broader understanding of global issues and a desire for interconnectedness.

This cohort prefers to spend money on travel, events and activities that enrich their experiences rather than on traditional consumer goods. Mental health is a foremost concern for them.

Organisations need to understand and adapt to Gen Z's preferences to thrive in an increasingly competitive landscape. Businesses need to invest in social media marketing, influencer collaborations and interactive content to effectively reach and engage this generation. Companies have to develop sustainable products, prioritise ethical sourcing and create offerings that align with the social issues important to this generation.

Organisations that connect with this cohort emotionally and demonstrate a commitment to their values will foster loyalty. Companies have to embrace technology to meet the expectations of this tech-savvy generation. Flexible work arrangements, mental health support and professional development opportunities are some of the critical topics to attract and retain this group.

Some global companies have already adapted their business strategies, marketing approaches and product offerings to align with the values and preferences of Gen Z. For example, Nike has incorporated sustainable practices into its production processes, creating eco-friendly product lines like the "Move to Zero" initiative, which aims to reduce waste and carbon emissions. Starbucks engages with Gen Z through its social media presence, promoting causes like racial equality. Netflix has adapted its content strategy to cater to Gen Z's diverse tastes and preferences. The streaming service produces original content that reflects the experiences and challenges faced by this generation, such as shows addressing mental health, social justice, and identity.

Bangladeshi businesses should gear up to understand and adapt to these characteristics of Gen Z for engaging effectively with this influential cohort as they continue to shape the business.

The author is chairman and managing director of BASF Bangladesh Limited