The Next Wave: What Contact Centers Need to Know About Generation Z
August 29th, 2018
Right when businesses feel like they’ve acclimated to Millennials, the next generation is quickly gaining influence. According to Pew Research Center, post-Millennials, often called Generation Z or iGen, include anyone born from 1997 onward – two years after the internet became commercialized. Gen Zers do not know a time without the internet; they grew up with smartphones. These and other major events like the Great Recession have undoubtedly had their impact, though their lasting effects remain to be seen.
While generations themselves are complex and diverse, businesses are taking note of behavioral and attitudinal patterns that are emerging as post-Millennials grow older. As its members enter the workforce and their prime consumer years, businesses will need to implement wide-sweeping changes to the contact center.
So, what are these patterns?
Marketers and trend forecasters say the preferences and behaviors of Generations Y (Millennials) and Z (iGen) are worlds apart due to historical and cultural events that have influenced how they were raised, while demographers often lump members of the generations together because they both grew up in a world proliferated by the internet, smartphones, social media, etc. Still, others like Lucie Greene, worldwide director of innovation group at J. Walter Thompson say that this generation exhibits many of the same traits and preferences as the Millennial one, but they’re stronger and more pronounced; She calls Generation Z, “Millennials on steroids.”
- They’re tech-savvy trendsetters. Having grown up in a tech-saturated world, Millennials and Gen Zers are both heavily reliant on technology. They are web-savvy and tech-friendly, readily and easily adopting new apps and platforms. Millennials’ dependence on mobile and social media led the way for older generations to adopt those technologies, and Generation Z’s adoptions will also foreshadow future acceptance and expectations of technology.
- They want everything on demand. Both generations grew up with the internet. While Millennials remember dial-up and slow connections, Gen Zers do not. They expect prompt service, information that’s easy to access, plenty of self-service options, and fast technology that continuously works.
- They are motivated by experiences. Both generations want more from their workplaces than traditional benefits. They desire a “fun” place to work with a better day-to-day work experience.
Some distinctions may be due to technology and world events, but some speculate that Gen Z has also observed and learned from the “generational mistakes” of the Millennials.
- They’re cautious. They’ve seen enough of the internet and social media to know that a digital footprint is a powerful thing – it lives forever, so they’re cautious in their online lives.
- They are great researchers and very knowledgeable. Growing up with the internet has made them knowledgeable (but also jaded) about everything from social issues to big brands to new product releases.
- They’re sensible. Many Gen Zers have parents who were hit hard by the Great Recession. Their difficulty finding work after college and their financial struggles have made their children entrepreneurial, competitive and fiscally responsible.
- They grew up in an online world. Generation Z has had fewer face-to-face interactions than previous generations and it could be detrimental to their interpersonal skills.
So how will Generation Z impact customer service and the contact center in the coming years…
The oldest members of Gen Z are just entering their prime consumer years, and they are already making huge waves in the business world with how and why they buy. According to research by Millennial Marketing, they currently spend about $143 billion annually and will account for 40% of consumers by the year 2020. Also, according to a study by Accenture, Gen Z consumers are less loyal to a single brand than the Millennial generation. As they gain buying power, they will drive tremendous change in the business world as brands will have to invest in new tools that will help them to engage and drive loyalty within this market. These changes will extend to the contact center, its operations and how it delivers customer service.
- Gen Zers are more likely than any other generation to utilize click-to-call buttons on their smartphones after searching for a business online. This could mean that contact centers will see a rise in this type of inbound call. And because they value fast, responsive service, they are more likely than the average consumer to hang up if their call isn’t answered within 45 seconds. Contact centers should consider additional methods for managing heavy volume, like implementing more dynamic routing solutions or outsourcing quick-to-scale call centers.
- It’s common for Generation Z to use multiple channels at once to resolve a customer service issue. They require a wide range of channels and touchpoints from which to choose when they engage with a brand and forcing them into using a select few channels is considered a major inconvenience. Mobile-friendly websites, plentiful click-to-call options, call centers that can handle heavy volume – all are imperative to the ideal customer experience. If Gen Zers feel inconvenienced, it’s a sign to them that the brand doesn’t value them as customers, And there will be no hesitation to switch providers.
- Omni-channel capabilities play into Gen Z’s desire for easy-to-access information. An omni-channel contact center facilitates a seamless data environment in which all channels are fully aware of each other and their data. In this type of environment, no channel is lacking important customer information so brands can deliver faster, more effective customer service.
…and as agents?
The expectation is that Gen Zers will make great employees. Not only do they adopt new technologies easily, but they’re also extremely hard workers. They grew up during the Great Recession, and it has taught them that they must work hard to get ahead and that they’re responsible for their own careers. Generation Z is more willing to relocate for a job (67%), or work nights and weekends (58%) than other working generations.
Contact centers are already a popular workplace for entry-level employees. They had previously evolved to meet Millennial expectations – e.g., creating more remote positions. This should continue if contact centers want to attract and retain members of Generation Z.
- Student loan debt in America (a staggering $1.5 trillion collectively) is causing much of Generation Z to question traditional methods of pursuing a higher education. Many of them will enter the workforce right after high school so they can pay for college out-of-pocket or pursue new avenues for professional growth. According to a recent survey of 4,500 college students, 64% of them want to start a business someday; budding entrepreneurs may join the “gig economy” during or after high school to fund the launch of a business.
There has been a huge upswing in the number of freelance and part-time workers over the last twenty years. Contact centers could capitalize on this trend by converting agent positions into freelance work, hiring consumers that are experts in their products and services – i.e., peer-to-peer support. According to a recent Forrester report, this type of “gig economy labor model” in the contact center could deliver exceptional service while cutting costs – the elusive apogee of performance. And 77% of Gen Z is already earning money through freelance and part-time work; filling this need would be a natural fit for them as they desire a flexible schedule and entry-level work.
- If the changes to contact center work are as drastic as expected – i.e., more remote and freelance positions, expanded responsibilities, open workspaces, etc. – hiring managers may want to hire based on a new mix of qualities – for example, the ability to self-direct and motivate.
- The digital world has led Generation Z to have fewer face-to-face interactions than previous generations. Interpersonal skills could be in high demand as contact centers hire more Gen Zers to perform agent work. In fact, this generation has listed interpersonal skills like communication and public speaking as areas in which they need more training before they enter the workforce. Interpersonal communication training could be a viable option if contact centers find their agents need additional coaching.
- Generation Z is looking outside of college for alternative methods to achieve professional and personal growth. In a recent survey, 85% of Gen Z reported watching at least one online video in the past week to learn a new skill. Contact centers should consider adopting these on-demand and online learning channels for agent training and continuing education. Slack, agent forums, short training videos on YouTube, and AR/VR practice sessions are all new, exciting options for this.
- The Center for Generational Kinetics has studied Gen Z extensively and has found that they’re used to instant reaction. This extends to the workplace as well, in the form of fast, regular feedback. There are a few contact center solutions that can deliver this. Gamification has already been implemented in a few contact centers but should truly be considered by all. Real-time, game-like feedback delivered via attractive dashboards are a natural fit for younger agents. Well-designed gamification can stimulate competition that keeps agents moving towards their next goal and present new training opportunities for continual growth.
The Center also found that 40% of those surveyed said they want daily contact with their boss. Real-time coaching and monitoring solutions have been developed specifically for this purpose so supervisors can monitor agents virtually and assist them with difficult interactions as they happen. Agents may also receive feedback from their bosses or tips on how to handle the same scenario in the future.
- Generation Z wants a “fun” place to work – with better day-to-day work experience and a flexible schedule. What makes a job fun? Work that’s enjoyable, hybrid offices with both open and private workspaces, a good team of co-workers, and some flexibility to work where and when they want are all important qualities in a Gen Zer’s workplace, and they are similar to those that Millennials desire. Contact centers that have resisted adapting their workplace culture should consider that the pressure to change will continue with the next generation.
Generation Z is already making huge waves in the business world with how and why they buy. As they enter the workforce and their prime consumer years, their influence will grow and introduce tremendous change in the contact center – its operations and agent work. It behooves companies to research this generation as much as possible, so they can prepare their customer service teams for what’s next. Though the research on Generation Z continues to evolve, there are signs that the most connected and educated generation in history will not only represent the future – it will forge it.