Operations

Meet your future customer: Generation Alpha

Born in a mobile and technologically advanced world, these customers will have more purchasing power than ever before.

You may have mastered millennials and possibly even Gen Z, but if you want to really ensure your business success, start hanging out in preschools. Those people born after 2009 are gearing up to be your biggest customer base—and opportunity, according to Australian social researcher Mark McCrindle.  

“There are two and half million being born every week in the world, so they are going to be the largest generation ever,” McCrindle says. So who is they? Generation Alpha. “We’ve been through the Latin alphabet and if we want to go back to A to the beginning we’ll have to go another alphabet,” McCrindle says. “Generation Alpha is the start of something new, so we went to the Greek alphabet. This is the first generation to live entirely with digital technology, as well as social media and apps. The mobility of lifestyle today, Gen Z has had that but for Generation Alpha that’s the only world they’ve lived in.”

The key points you need to know to understand Generation Alpha are technology, money, mobility and size.

Yes, Gen Z has grown up with tablets and computers, but Generation Alpha is the first generation that will live their entire lives immersed in this technology. It’s such a huge part of their lifestyle that the group is also being called Generation Glass. 

“Glass is the medium of information communication for them,” McCrindle says. “This is the first generation that has glass as their primary means. Other generations had paper. They took exams on paper and read textbooks in paper. But Generation Alpha’s textbooks are digital, there are tablets that are their key primary reading tools in the classroom. The mass communication, portable content medium they use is no longer the book. The previous means of communication was transformed 600 years ago and that was paper when Guttenberg came up with the printing press. Things could be mass produced. The next medium is portable communication and mobility and that’s glass. Glass is ubiquitous for this generation. They have more screens in front of them than ever before.”

Glass—which goes beyond the computer screen to things like Google Glass and smartwatches—also changes the way these people will consume media. It’s no longer static but dynamic, with videos and interactivity being paramount.

Then there’s money. According to McCrindle, Generation Alpha will have more discretionary money to spend than ever before because this group will stay single longer and remain in college longer, with the college mindset of spending money on lifestyle buys and not investing in retirement. They also will be more mobile, meaning they won’t be purchasing homes as early or often.

For the hospitality industry, that will mean several things. First, because they are more likely to move around so much, they are more likely to be frequent customers at your locations. Ditto with their increased discretionary spending. And you won’t have to wait until the magic 25 to 40 age group before they start having the money to be big-time purchasers.

Because of technology, kids have ready access to money. Parents can enable devices to charge purchases to without needing a credit card. “In the past we as a society haven’t focused on the children being key decision makers with what they buy or the cafes they visit because really the money they have to spend is just pocket money,” McCrindle says. “Generally they have small amounts. But increasingly these children have devices that allow them to pay for things.”

Generation Alpha will be the biggest generation ever, but that population will be concentrated more so than ever in Asia. As India and China become the demographic and economic epicenter of the world, trends will no longer move from West to East but from East to West. It’s already started with the wild success of Gangnam Style, the song and music video that has become the No. 1 watched video on YouTube.

And if you aren’t paying close attention to peer-review sites, you better start. Sites like Yelp and Trip Advisor will become increasingly more important to Generation Alpha, McCrindle says. “They have the power to drive the social trends. They have the power to determine consumer choices because they have social media power.”

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