Interpreting the "Digital Native Generation Consumption and Values Survey '21" ~ How the Pandemic Changed the Digital Native Generation's Purchasing Behavior ~ (Part 1)

Understanding the mindset and behavior of younger generations is always crucial. The generation known as Generation Z/Millennials (currently, late teens to early 30s as of 2022) is often referred to as the "digital native generation," having grown up with daily exposure to internet services from birth. They are frequently noted for exhibiting tendencies significantly different from previous generations.

Against this backdrop, Dentsu Digital Inc. conducted and released the " Digital Native Generation Consumption and Values Survey '21." While we previously covered the survey results in an article, this time we delved deeper into the findings and analysis by speaking with Yuta Matsuzaki and Akane Abe from the company that conducted the survey. We present this discussion in two parts: Part 1 and Part 2. This content should offer valuable insights for marketers and planners looking to engage younger generations.

Changes in the purchasing behavior of the digital native generation revealed by the COVID-19 pandemic

Q. First, could you remind us of the purpose behind conducting the "Digital Native Generation Consumption and Values Survey '21"?

Matsuzaki: We are members of "YNGpot.™️ (Young Pot)", a specialized marketing team within Dentsu Digital Inc. focused exclusively on digital natives. This team itself is composed entirely of digital natives. We support service development and provide marketing solutions grounded in insights about the digital native generation, their information acquisition and purchasing behaviors, and business trends.

As part of this, we have been conducting the "Digital Native Generation Consumption and Values Survey" regularly since 2020 to capture shifts in their insights. We started it as a fixed-point survey. The 2020 survey focused on the main theme: "What changes occurred in the consumption and values of the digital native generation after the COVID-19 pandemic began?" The latest fixed-point survey was conducted in October 2021, nearly two years after the pandemic began.

The latest survey focused on the various lifestyle changes born from the impact of the COVID-19 pandemic. For example, new digital services like online meeting tools and food delivery services rapidly gained widespread adoption, and new movements such as remote drinking parties and remote dating emerged. At the same time, we believe this period also marked the emergence of distinctions between changes that "became widespread and established in society" and those that "gained temporary popularity but failed to become established." Specifically, while remote drinking surged immediately after the pandemic began, its use has since become more limited. Conversely, food delivery services remain widely used today, indicating they have become firmly established.

Therefore, I thought it was crucial to refocus on the difference between what became established and what did not after the changes brought by the pandemic, especially for future service development and marketing/communication strategies. Moreover, since the digital native generation excels at mastering digital devices and anticipating information, another major objective was to clarify what values this generation now holds and how they are shaping their consumption behaviors following the pandemic.

Against this backdrop, we decided to conduct the 2021 survey with the aim of identifying "what the next standard might look like after the pandemic."

The Increasing Trend of "Self-Expression Consumption" Among the Digital Native Generation

Q. What was your initial impression upon seeing the survey results?

Matsuzaki: First, when examining the digital native generation's consumption behavior from the survey results, I noticed a stronger tendency to use social media posts about purchased items to express or showcase personal interests and preferences. This serves as a way to connect with others or join communities, likely influenced by reduced real-world communication opportunities during the pandemic. This shows that products aren't simply sought and purchased for their functional value alone. We also saw their mindset: they want to try various things, but feel significant anxiety due to limited real-world connections. This gave us a glimpse into the pandemic's impact.

Furthermore, when preparing hypotheses for this survey, I spoke with new employees at Dentsu Digital Inc., who are digital natives, about their "brand perceptions." What struck me was how strongly this generation feels that the source of a company's "brand" has fundamentally changed compared to previous generations. Traditionally, a company's "brand" stemmed from what it communicated and the image it sought to project. Recently, however, this has shifted dramatically. For younger people, the "community" surrounding the company – who uses its products, how those users feel, and what they say – has become the primary source of the "corporate brand." Considering the factors driving this change, it likely stems from their upbringing in an environment where interactive communication via digital technology is the norm.

I also noticed intriguing characteristics in how products sell. For example, certain beauty items "sell out in stores within days of release." I inquired about the flow behind this phenomenon. It turns out that first, beauty-savvy influencers start sharing about the product on social media before its release. Next, their followers—the "beauty fans"—rush to stores on launch day to buy it. Furthermore, when these beauty fans post about their purchase on social media, it spreads further, permeating the entire beauty community. This ultimately leads to the product selling out in stores. This occurs because the "beauty" community serves as the base from which information spreads. Such phenomena happen because, for the digital native generation, posting what they bought and when on social media is crucial for expressing their "likes" and connecting with others who share similar tastes.

The communities mentioned above exist in diverse forms beyond the beauty genre. Within them, information exchange occurs, and specific information spreads – a dynamic observed frequently. Of course, mass media still holds influence, but compared to the past, the trend where "information spreads originating from SNS communities" is becoming the standard, rather than starting from information programs or TV dramas.

I believe the concept of "community" explained thus far is a crucial keyword for understanding the digital native generation. In the past, "real-world spaces" like "local communities," "schools," and "companies" were the primary sources of community. Close friends were often made at "the same school," and people you frequently went out drinking with were mostly from "the same workplace." However, survey results also revealed that for the digital native generation, coupled with the loss of real-world connections due to the pandemic, the tendency for "likes" to become the source of community has grown stronger. This is because with just a smartphone, people with "the same tastes" – like "I like this influencer," "I like this baseball team," or "I like this scenery" – can easily connect on SNS. Age, gender, occupation, and place of residence don't matter.

The survey also revealed that many digital natives strongly desire to "express their true selves." Yet, they simultaneously feel anxious, wondering, "But what exactly is my true self?" and "Am I out of step with others?" This is precisely why connecting with others through shared "likes" provides reassurance. Even if it's not a real-life connection, it can happen on social media. I believe this is the defining characteristic of the digital native generation. Some even use multiple accounts to belong to various communities. There's the "beauty-loving" me, the "camping-loving" me, the "idol-loving" me. They have diverse selves, and by actively participating in each community as their "○○-loving" self, they express their individuality in different spaces.

The digital native generation's "ability to create usage scenarios"

Q. In your ongoing research on the digital native generation, what aspects of their consumption behavior and values have you focused on?

Abe: I also find it fascinating that for digital natives, "what products or services they use" connects to expressing their personality and participating in communities. At the same time, they seem to have a dry, rational side when choosing things.

They make purchasing decisions from multiple perspectives, employing criteria that are, in a sense, highly rational: "Does the company engage in environmental conservation?", "Does the brand have a clear vision or purpose?", "Does it hold resale value?" What I find most fascinating is this duality: the aspirational element of "I want to be seen as this kind of person by buying this," combined with a very rational decision-making side.

Another point I'm focusing on is that the digital native generation has the ability to create uses for products and services that the creators likely never anticipated.

I once heard an interesting case involving a location-sharing app. This app allows users to share their current location with friends. While this enables things like "My friend is here, so I'll go meet them," it also means your location is constantly visible, making it a service that seems inherently controversial. The developers likely envisioned young people using it to connect with friends or partners, making it easier to invite each other out. However, in practice, beyond that use, it seems people are also using it during events like ski resorts or outdoor festivals to "check each other's locations and meet up." The ability to discover and expand such usage scenarios is something unique to the digital native generation.

The "Digital Native Generation Consumption and Values Survey '21" examined changes in the behavior and mindset of the digital native generation during the COVID-19 pandemic. Delving into this survey reveals that their attitude toward "things" differs significantly from other generations. For them, things are not merely functional objects; they have become important elements tied to self-expression and connections with peers. In the second part, to delve deeper into the consumption behavior and values of the digital native generation, we will examine the process they go through before purchasing items and the criteria they use to make purchasing decisions.

• Interpreting the "Digital Native Generation Consumption and Values Survey '21" ~ How the Pandemic Changed the Digital Native Generation's Purchasing Behavior ~ (Part 2)