Latest news with #digitalnatives
Finextra
2 days ago
- Business
- Finextra
The Modernization Imperative: Why Financial Services Cannot Afford Legacy System Inertia: By Sergiy Fitsak
The financial services sector has reached an inflection point where legacy system modernization has shifted from strategic advantage to business imperative. Institutions operating on decades-old infrastructure face mounting pressure from regulatory evolution, competitive disruption, and customer expectations that legacy architectures simply cannot meet. While modernization carries inherent risks in a heavily regulated environment, the cost of inaction has become demonstrably higher. Financial institutions that delay transformation risk regulatory non-compliance, competitive disadvantage, and operational inefficiencies that compound exponentially over time. The Convergence of Modernization Drivers Regulatory Complexity and Compliance Burden Modern financial regulations demand system agility that legacy platforms cannot deliver. Open banking mandates, real-time payment requirements, and evolving data privacy regulations require architectures built for adaptability, not just stability. Legacy systems with hardcoded logic and manual processes struggle to accommodate rapid regulatory changes while maintaining audit readiness. The compliance burden extends beyond implementation to documentation and reporting. Modern regulations require granular transaction tracking, real-time risk monitoring, and comprehensive audit trails—capabilities that legacy architectures often lack without significant workarounds. Competitive Pressure from Digital-Native Challengers Fintech startups and embedded finance providers built on cloud-native infrastructure consistently outpace traditional institutions in product innovation cycles. These challengers deploy new features weekly rather than quarterly, offer personalized services through advanced analytics, and provide seamless digital experiences that legacy systems cannot match without extensive customization. The threat extends beyond direct competition. Big Tech companies entering financial services with platform-based approaches force traditional institutions to reconsider their technology foundations to remain relevant in evolving ecosystems. Evolving Customer Expectations Digital-first customers expect instant account opening, real-time payment processing, and personalized financial insights. Legacy systems designed for back-office efficiency rather than customer experience struggle to deliver these capabilities without introducing significant latency or operational complexity. The gap between customer expectations and legacy system capabilities continues widening as digital experiences in other sectors set new standards for responsiveness and personalization. Strategic Modernization Approaches for Financial Services Incremental Architecture Evolution Financial institutions typically cannot afford the operational risk of wholesale system replacement. Successful modernization strategies focus on incremental transformation that preserves business continuity while enabling progressive capability enhancement. Core system wrapping with API layers represents the most common initial approach. This strategy enables modern applications and partner integrations to interface with existing systems without requiring core logic changes. The approach provides immediate value while establishing the foundation for more comprehensive modernization efforts. Cloud-First Infrastructure Strategy Hybrid cloud adoption allows financial institutions to balance regulatory requirements with operational efficiency. Non-critical workloads such as analytics, customer portals, and development environments migrate first, while sensitive transaction processing remains in controlled environments until regulatory frameworks evolve. Cloud-native services enable advanced capabilities—real-time fraud detection, predictive analytics, and automated compliance monitoring—that would require significant investment to develop internally on legacy infrastructure. Data Architecture Modernization Modern financial services require real-time data processing for fraud prevention, regulatory reporting, and customer personalization. Legacy ETL processes and batch-oriented data flows cannot support the analytical requirements of contemporary financial products. Event-driven architectures using modern streaming platforms enable real-time transaction monitoring, instant fraud detection, and immediate regulatory reporting while reducing system complexity compared to traditional batch processing approaches. Implementation Considerations and Risk Mitigation Regulatory Compliance in Modernized Environments Modernization efforts must maintain regulatory compliance throughout transformation phases. This requires careful planning around data residency, audit logging, access controls, and disaster recovery capabilities. Modern architectures actually enhance compliance capabilities through improved observability, automated monitoring, and granular access controls. Documentation and change management become critical during modernization to satisfy regulatory requirements for system understanding and control procedures. Operational Risk Management Financial institutions require comprehensive testing strategies that validate not just functionality but also performance under stress conditions. Modern infrastructure enables more sophisticated testing approaches including chaos engineering and automated load testing that improve system resilience. Rollback capabilities and feature flagging ensure that modernization efforts can be reversed quickly if issues emerge, reducing the operational risk of transformation initiatives. Skills Development and Team Alignment Successful modernization requires workforce development alongside technology transformation. Teams accustomed to legacy systems need training in cloud-native development, API design, and modern DevOps practices. Organizations often supplement internal teams with specialized expertise during transition periods to accelerate knowledge transfer and reduce implementation risks. Measurable Business Impact Operational Efficiency Gains Modernized financial institutions typically achieve significant cost reductions through automated processes, reduced manual interventions, and improved system reliability. Cloud-native infrastructure provides variable cost structures that align technology spending with business growth rather than fixed capacity planning. Enhanced Customer Experience Modern architectures enable real-time personalization, instant transaction processing, and seamless omnichannel experiences that drive customer satisfaction and retention. The ability to launch new products rapidly allows institutions to respond quickly to market opportunities. Regulatory Responsiveness Modern systems adapt to regulatory changes more efficiently through configuration rather than code changes. Automated compliance monitoring and reporting reduce manual effort while improving accuracy and auditability. The Path Forward Financial services modernization represents a strategic imperative that cannot be indefinitely deferred. Institutions that approach transformation systematically—balancing innovation with risk management—position themselves for sustainable competitive advantage in an increasingly digital financial ecosystem. The question facing financial leaders is not whether to modernize, but how to execute transformation that enables growth while preserving institutional stability and regulatory compliance.
Khaleej Times
3 days ago
- Business
- Khaleej Times
UAE: How some Gen Alpha kids are driving online shopping, household purchases
They may not be the ones footing the bill, but Generation Alpha — children born from 2010 onwards — are playing a major role in household shopping decisions. A new report by global market research firm GWI (formerly GlobalWebIndex) shows just how influential these young digital natives have become. This report is powered by over 20,000 surveys completed by Gen Alpha kids aged 8-15. Majority of children aged 8 to 11 now actively influence — and often decide — what gets added to the shopping cart, from groceries to toys. Khaleej Times reached out to a few parents and experts to understand how this trend is playing out in the UAE. 'My seven-year-old daughter Tanzi basically takes over when I'm shopping online, especially on apps like Temu and Shein,' said Bhavya Rao, a Dubai-based mom. 'She's always peering over my shoulder, eager to see what I'm adding to the cart. She'd pick out items like craft kits, fun accessories, even light makeup or pretend nails. Before I know it, she's made her own little wishlist, full of handbags, hairbands, and whatever else she's spotted," she added. The influence extends far beyond kids' items. 'I never imagined my 9-year-old would influence so many of our household purchases," said Rania El-Masry, an Egyptian mother of two. "From cereal to my work shoes, she always gives her opinion. She follows online reviews, compares styles, and knows what's trending. If something's not 'cool' by her standards, she won't touch it — and neither will her brother. Even when I shop for myself, she's right there giving me fashion advice," Rania added. High exposure to digital content Meanwhile, mental health experts in the UAE echo the findings, saying this growing influence is largely from Gen Alpha's constant exposure to digital content and influencer culture. Carolyn Yaffe, a mental health expert at Medcare Camali Clinic, said, 'This influence is also noticed in their purchasing activities. The extent of social media knowledge that the Gen Alpha kids have are making them more aware of and susceptible to product recommendations." She also noted that children now trust online influencers more than friends or even family when it comes to product recommendations. Gen Alpha kids are constantly watching YouTube unboxing videos, TikTok reviews, and social media content that blends entertainment with subtle marketing. These are shaping their preferences — and making them co-decision-makers when parents shop. 'Brands are adapting their strategies to engage with Gen Alpha, by focusing on their digital platforms, influencer marketing, and creating immersive, interactive experiences that resonate with the values and preferences of Gen Alpha kids," Yaffe added. Yaffe noted that these marketing strategies come in the form of gamified experiences, personalisation, and influencer-driven campaigns. Authenticity and sustainability are also key themes that resonate with these young consumers. Girish Hemnani, life coach and energy healer based in Dubai explained that children are being raised in homes where their preferences are not only heard but respected. 'Thanks to digital media and influencer culture, kids are no longer passive observers. Even though Gen Alpha isn't spending money directly, brands are marketing to them as if they do because in many households, they're the emotional decision-makers. That's why they're not just selling products anymore — they're creating worlds Gen Alpha can emotionally plug into," Girish said. 'You'll see it everywhere: YouTube videos that feel like playdates, product packaging that looks like art projects, and language that's all about fun, freedom, and imagination. Stores are even setting things up at a child's eye level, while websites and games speak their digital language fluently. It's no longer about convincing the parent — it's about inspiring the child. Because when a kid feels seen, excited, and involved, they don't just ask for something... they make it feel like a part of their identity. And that's powerful," he added.
Forbes
5 days ago
- Business
- Forbes
8 Assumptions About Gen Z Employees—And Why They're Incorrect
By Kristin Schinella Gen Z seeks workplaces with open communication, psychological safety, and opportunities for growth. Generation Z, born between 1997 and 2012, represents the largest cohort of new workers, and by 2030 is expected to represent 30% of the total workforce. Gen Z is also considered by most managers (74%) to be the most challenging generation to work with. Issues surrounding Gen Z run the gamut from being unprepared to enter the workforce to lacking in motivation to unable to take feedback. This disconnect between management and Gen Z makes sense when you consider the landscape from which these younger professionals have emerged. Gen Z represents the first generation of true digital natives—people who have never known a world without smartphones, instant connectivity, and information that is literally at their fingertips. And the differences aren't just technological. They're also experiential, cultural, and deeply human. When hiring Gen Zers, companies should consider these differences, and it isn't about accommodating weakness—it's about being understanding. In this article, we will explore how to bridge these generational gaps productively. Assumptions About Gen Z Workers This generation isn't avoiding hard work, they're redefining what meaningful work looks like. Sixty-five percent of Gen Z employees describe themselves as extremely eager to learn, and nearly three-quarters are motivated to contribute more than is required. Gen Zers experienced their formative years during cascading crises: an economic recession, climate anxiety, social upheaval, and a global pandemic. These experiences created a heightened consciousness of life's fragility that drives them to seek purpose in their daily activities. The numbers support this: 89% of Gen Zers see purpose-driven work as essential to their overall well-being, and the majority will research a potential employers' social impact before applying for work. Unlike previous generations who compartmentalized work and life, Gen Z seeks integration—they want their values reflected in their daily tasks, not relegated to weekend volunteer activities. How managers can respond: Make your commitments to social issues, work-life balance, and growth trajectories known. When work aligns with personal values, intrinsic motivation flourishes. When it doesn't, Gen Zers' efforts may seem hollow, not because they're lazy, but because they're looking for meaning in the work they do. Companies that regularly communicate their social impact through transparent reporting create what psychologists call "moral engagement," where employees' personal identities become intertwined with the organization's mission, leading to discretionary effort that extends far beyond job descriptions. Unlike previous generations who prioritized salary above all else, Gen Z's priorities are split nearly evenly between compensation and purpose in their career decisions. What managers interpret as entitlement often reflects sophisticated boundary setting. Gen Z is entering the workforce with clearer expectations about reciprocity and they are more inclined to invest deeply in organizations that invest meaningfully in them. This is a group that was rewarded at an early age for simply showing up as parents peddled the "everyone gets a ribbon for participation" value. They grew up in structured environments where expectations were explicit, and with parents and schools that espoused formulas about how to achieve and what achievement looks like. From organized sports to standardized testing, they learned to function with clear feedback loops and acknowledgment of effort. How managers can respond: Show appreciation. Managers often expect young professionals to work extra hours "because that's what we did," without verbal appreciation or tangible recognition. If you demand sacrifice, demonstrate reciprocal investment. Neuroscience research reveals that recognition activates the same neural pathways as monetary rewards, with verbal acknowledgment releasing dopamine that reinforces positive behaviors. Teams receiving regular recognition consistently demonstrate higher productivity and better performance compared to those operating under traditional command-and-control structures. Picture a generation raised on real-time updates: grades posted online, immediate responses to social media posts, GPS that recalculates the route when you take a wrong turn. Gen Z learned to course correct quickly because information was always available. They also grew up with protective parents and feedback-rich schooling, which shielded them from failure's sting. So for many Gen Z employees, feedback serves as an anxiety-reduction tool. A study found that most Gen Z employees want feedback regularly, and many would like it weekly. Without regular input on their trajectory, uncertainty breeds stress. They view feedback as navigation data, not personal judgment. How managers can respond: Course correct quickly. Annual review cycles that delay feedback frustrate employees who thrive on continuous calibration. Teams implementing frequent feedback loops see faster skill development and role clarity. Managers often cite being 'busy' as a reason for cancelling one-on-one meetings, but the price is leaving younger workers rudderless and anxious. A brief check-in to answer questions can keep Gen Zers on track, and they will view you as someone who cares and is trustworthy. While many managers believe Gen Z lacks communication skills, the reality is they communicate constantly, but do so via different channels and styles than previous generations. They have mastered communication through images, brief text, video gaming, and ephemeral messages. Think about the cognitive skills they have acquired: conveying emotions through carefully chosen emojis; building relationships through curated visual content and gaming; and parsing nuanced meaning from abbreviated exchanges. These communication patterns reflect specific expectations: brevity over elaboration, visual over textual, and immediacy over delay. However, in traditional corporate communication formats, Gen Zers may be less skilled and need explicit training. When comparing Gen Z to other generations, Mental Health America found that 63% of Gen Z employees do not feel confident expressing their opinions, and 60% felt that they could not be themselves at work. This raises the issue that while Gen Zers' style of communication is different, they also don't feel safe expressing themselves in the workplace. How managers can respond: Effective intervention requires parallel tracks. First, organizations must acknowledge that communication competency exists on multiple planes. They should offer training in traditional business communication while also embracing multimodal communication, such as visual collaboration tools. Brief check-ins can enhance overall company communication. Second, creating psychological safety becomes paramount. When young professionals feel genuinely heard and valued, their natural communication abilities will flourish. This means establishing mentorship structures that bridge generational communication styles while building confidence in formal channels. When psychological safety increases, communication barriers dissolve and retention improves dramatically. More from AllBusiness: Gen Z knows how to work effectively and efficiently at home. Many entered college remotely, started careers from their childhood bedrooms, and learned professional norms through Zoom squares rather than conference rooms. This generation, however, is "pro-office" with 65% preferring working hybrid and only 29% preferring working fully remote. They want hybrid arrangements, not to avoid doing work, but because they value work flexibility as a means to peak performance. They also value authentic human connection and have discovered that focus and creativity can be enhanced by controlling their surroundings. Research on autonomy confirms that when people have control over their work environment, their motivation and well-being increase dramatically. How managers can respond: Offering employees only fully remote or in-person work options misses the nuanced preferences that not only drive retention, but encourage employee engagement and innovation. Organizations that offer thoughtful flexibility will see the highest satisfaction rates with Gen Z as well as all generations of employees. Gen Z was raised on screens, and many use their devices intentionally for work-related tasks such research, networking, skill development, and collaboration. For this generation, the distinction between digital and analog tools doesn't exist, and their phones, while capable of causing distraction, are also productivity extensions. A Gen Z employee on their phone may be cross-referencing client information, coordinating with remote team members, and researching industry trends—all simultaneously. How managers can respond: Blanket phone policies may alienate digital natives and reduce efficiency. Smart organizations should establish technology guidelines that distinguish between productive and distractive use, leveraging rather than limiting capabilities. For example, during meetings, set guidelines for when it's okay to be on the phone to do work, and to know which meetings are an absolute no phone zone. A survey of recent college graduates found that 92% want to be able to talk about mental health at work. Between Covid, climate anxiety, and mass shootings, this group has been exposed to sensitive conversations from an early age, which has reduced the stigma of mental health. Their openness about psychological wellness isn't a weakness—it's strategic transparency about factors that affect workplace performance. In a McKinsey study, over a quarter of 18- to 24-year-olds say that mental health significantly impacts their work performance. Previous generations often wore stress as a badge of honor, equating burnout with dedication, but Gen Z sees this as counterproductive. They seek work environments that sustain long-term high performance rather than short-term heroics that can lead to eventual collapse. How managers can respond: Organizations that dismiss mental health needs as "soft" lose high performers to companies that understand the connection between psychological safety and productivity. Workplaces that invest in meaningful mental health programs see significant reductions in turnover compared to those that do not. High-trust organizations report 50% higher productivity and 76% greater engagement. Gen Z respects competence and authenticity over titles and tenure. They grew up with unprecedented access to information and learned to base their belief structure on what they consider substance rather than status. Having been taught to question, research, and verify information online, they apply the same critical thinking to workplace hierarchies. Gen Zers will respond positively to leaders who demonstrate expertise, maintain transparency, and invest genuinely in their development. They want to understand the reasoning behind decisions as well as contribute to solutions. They're not necessarily asking "why" to challenge authority, but to understand context that will help them perform better. How managers can respond: Organizations with managers who act as coaches rather than commanders will see significantly higher engagement, retention, and performance—especially among younger workers. Leadership research shows that coaching-oriented managers produce teams with superior problem-solving capabilities and faster skill development compared to traditional hierarchical approaches. Transparent decision-making processes where rationale is shared openly create what organizational psychologists call "cognitive buy-in," leading to higher implementation rates of new initiatives among Gen Z team members. How Gen Z-Ready Is Your Organization? Is your business Gen Z-ready? Answer yes or no to the following questions: □ Do you offer weekly feedback opportunities?□ Can employees work hybrid when needed?□ Are advancement paths clearly communicated?□ Do you have robust mental health resources?□ Do you have multi-channel communication platforms?□ Do managers coach rather than command?□ Is your company's mission clearly articulated?□ Do you recognize effort beyond just results? Count the number of yes responses. 6-8=Well-positioned; 4-5=Needs attention; 0-3=Not Gen Z-friendly If your company isn't ready to attract and keep Gen Z employees, here's what you can do to change that: Your Next Move The choice is clear: continue paying the hidden costs of clinging to assumptions, or invest in understanding the generation that will define the next decade of workplace evolution. Gen Z isn't asking organizations to lower standards, they are asking us to consider the larger social and cultural implications of our practices, to remember that mental health does not suddenly disappear when we walk into work, and that everyone works better with open communication, psychological safety, and opportunities for growth. The data is compelling. The choice is yours.
Harvard Business Review
10-07-2025
- Business
- Harvard Business Review
How Pop Mart Won Young Customers in a Fragmented Attention Economy
In the Internet era, content is not only abundant but increasingly fragmented. Customers' attention is also becoming fragmented due to the short videos and other media they consume every day. As that happens, the traditional logic of consumer product innovation and marketing with sophisticated, big-budget development is becoming less efficient. Instead, to win customers who grow up in today's attention economy, leaders need agile strategies tailored to these individuals' emotional and identity needs. My research on company cases and behavior patterns of digital natives indicates that young companies like Pop Mart, a Chinese toymaker that's reached global success by selling character-based premium products, offer valuable insights. During 2024, Pop Mart's stock price has more than quadrupled year-over-year. Understanding Pop Mart's story—and the individuals it serve—can help consumer goods companies build up brand recognition among the digital-native generation and achieve financial success. The lessons in this article also apply to business leaders running B2B operations, who must learn to cater their products to a group of digitally native decision-makers. This generation isn't just individual consumers. They are increasingly influencing an organization's purchasing decisions. Appealing to Young Customers Pop Mart is best known for its artist-designed collectible figurines and 'blind box' marketing strategy, in which buyers don't know which figure they've purchased from a themed set until opening the package, which can compel them to buy more. Pop Mart first created a sensation in 2017 by organizing comic toy exhibitions in China. It then began collaborating with luxury brands, creating a series of hit products, and opening hundreds of stores around the world. In 2024, Labubu, one of Pop Mart's signature dolls with unique artistic design , wielded its charm across millions of fans in Southeast Asian countries, a market many multinational companies are actively competing for. Pop Mart's business outside mainland China now accounts for nearly 40% of its $1.8 billion total revenue. What propelled Pop Mart's success lies in its agile strategies targeting millenials and Gen Z customers. Leverage Real-time, Data-based Customer Insights In an era of fragmented attention, companies need to upgrade their ability to rapidly identify—and promote—the right innovations, based on real-time consumer feedback. Coupled with swift adjustment in supply chain decisions and marketing resources, such insights help transform otherwise fleeting trends among young customers into tangible profits. This sort of resource matching capability is akin to how TikTok's algorithm identifies emerging internet sensations. When the algorithm detects that a type of short videos is gaining traction, e.g., garnering high engagement through shares, likes, and completion rates, the algorithm automatically channels more traffic to the content, amplifying its visibility across the platform. Similarly, when developing a new product series, Pop Mart collects feedback from the markets in real-time and iterates the design accordingly. Once it identifies characters that can foster strong connections with users, the company will swiftly adjust its product development resources so it catches trendy topics among young customers. Such a doing-to-learn approach allows companies like Pop Mart and TikTok to maximize their chance of success in pushing forward the right innovations in a time when the audience's attention is highly fragmented. One example of this 'algorithmic' operation—where smart use of consumer feedback data, not just creativity, drives the lifecycle of a new innovation—is the recent breakout success of Labubu. Originally a niche figure from The Monsters series by artist Kasing Lung, Labubu rose to prominence through Pop Mart's agile and data-driven approach. When the company's monitoring caught global celebrities like Lisa of BlackPink and Rihanna organically promoting Labubu on social media and generating huge views, Pop Mart rapidly relocated resources to amplify the momentum. Recognizing higher user engagement with a soft, tactile type of dolls in plush form, the company created the 'soft vinyl plush' category by combining expressive rubber faces with plush bodies. This further enhanced shareability on social media as users posted more physical interactions with Labubu. When expanding globally, Pop Mart leveraged Shopee and TikTok data on consumer feedback to localize offerings for new markets. Data analysis also influenced its marketing decisions for the Western customers, aligning with locally relevant fairytale themes and fashion culture. Through data-driven operations from product innovation to marketing, Pop Mart demonstrated how product concepts—from the mischievous grinning, fanged Labubu to the pouty-lipped, perpetually unimpressed Molly with large emerald eyes—can be transformed into cultural phenomena attractive for global young consumers. Companies across a wide range of industries, not just those in consumer goods and services, can learn from Pop Mart and TikTok to build more adaptive and data-informed product and brand strategies. By continuously monitoring, testing, scaling, and iterating, firms can dynamically match concepts with shifting market signals, much like how algorithms amplify viral content. This requires having the infrastructure to track real-time consumer feedback and the organizational agility to swiftly adjust product development, marketing, and supply chain decisions. While today's geopolitical uncertainties often complicate supply chain planning, these uncertainties also present an opportunity for firms to build more capabilities allowing for rapid responses. For example, Pop Mart's supply chain optimization to develop precise and operationally lean infrastructures enabled a 30-fold increase in production within a year. Companies that adapt and develop sufficiently granular, responsive resource allocation systems—across a product's life cycle—will be rewarded with cost-effective growths, especially with the digitally native customers. Tap into Young Customers' Individuality and Community Needs For brands, winning the digital-native customers also means adopting marketing strategies that engage with their deep psychological needs and seizing on opportunities to create cultural phenomena associated with the brands and products. Take the blind box marketing strategy. Although Pop Mart is known for the surprising and even addictive nature of its mystery figures sold in blind boxes, the company is not the first to use the strategy. The concept originated in Japan, where consumers purchase random, palm-sized toys sealed inside plastic capsules from a special vending machine without knowing the exact contents in advance. This approach encourages the collection of various editions, including limited or hidden ones. What's special is that Pop Mart managed to turn users' collecting behaviors into a phenomenon: not only driving repeat purchases from existing users, but also attracting loads of new customers as loyal fans post their highly emotional unboxing reactions on social media. Underneath the use of limited and hidden editions are strategies to attract and satisfy the emotional needs of young customers. Moreover, these strategies greatly enhance the user's sense of self identity. When someone secures a coveted, limited-edition item, they feel cool and unique. Owning a rare Labubu doll that no one else has? That is a bold statement of identity and individuality. For other companies, they should likewise asses how their products and brands connect with young audiences on a deeper identity level, and explore innovative ways to enhance these touchpoints and foster more meaningful consumer relationships. The tangible benefits of such deep connection are evident across many consumer goods industries. It's seen in those IP-related merchandises purchased by K-pop group fans, and in Starbucks' seasonal themed products (such as its iconic holiday cups) that go beyond utility to evoke emotional resonance and deepen brand affinity. Business leaders can also learn from Pop Mart's focus on offline experiences to engage young users and build a cultural phenomenon around their brands. Different from its Japanese competitors selling blind box figurines, which are marketed via Internet sales and a distributor model, Pop Mart has built its own flagship stores with vibrant color and digital media to create a unique brand experience and encourage meet-ups. This is important for young customers who crave for human connections after the pandemic—some fans would even travel across continents to visit these iconic stores and engage with fellow enthusiasts. Having such spaces encourages customers to spend more time in the stores, building a deeper sense of brand loyalty and community. And such loyalty can extend to online platforms as well. In the case of Pop Mart, online communities for young customers from Instagram to Reddit further amplified the cultural phenomenon sparked by Pop Mart's art toys, building up a positive feedback loop between online and offline sales. In a similar vein, Nike's seamless integration of physical stores, mobile apps, and online campaigns illustrates how a unified ecosystem can deliver for consumers—and the brand. Companies aiming to foster robust engagement with Gen Z customers can draw important lessons from Pop Mart's success beyond the blind box tactics. At the heart of its appeal are strategies that spark user-generated content and help young consumers express their individuality and social identity. Equally critical is the creation of immersive offline experiences, offering customers dedicated spaces to connect, explore, and share, while digital communities amplify this sense of belonging and self-expression. By skillfully tapping into the young customers' psychological needs, blending experiential touchpoints and community connections, companies are more likely to deepen young customers' ties to the brand and elevate their products into lifestyle symbols. Cultivate Belonging and Loyalty Among Digital Natives Like LEGO, Pop Mart has gradually developed its own unique brand language to further enhance users' sense of community and belonging. This is particularly important for consumer brands trying to appeal to the digital generation, as these young customers can often feel isolated despite constant online activity. In the case of Pop Mart, the company has intentionally cultivated a series of buzzwords that's emerged within the brand's fandom space over time. Phrases like 端盒 (buy a whole set of blind boxes to get one's target doll) and 拆盒 (split a full box) have become an integral part of the community culture. Beyond blind boxes, other particular terms have also been augmented through user generated content across social media platforms, such as 娃友 (friends of doll), while enhancing Pop Mart's relationship with users. Over the decades, successful brands—from Apple to Hello Kitty—often intentionally form a set of brand language choices in their interactions with users, strengthening their perceived identity and community engagement. Pop Mart's exclusive language is not so different. Language helps facilitate the deep rooting of a cultural phenomenon and drives a brand's continuous growth. While this lesson may not be as broadly applicable as the previous two, it still offers meaningful implications for firms aiming to communicate more effectively with digital-native customers. Companies should actively monitor online conversations related to their brands among young audiences and participate in the emerging of unique expressions and trending word choices. By supporting the shared vocabulary and linguistic style within one's brand community, companies can foster a stronger connection with the young generation. … One additional point: Many of these developments are taking place within the realm of social media platforms, such as RedNote in China and TikTok in Southeast Asia. For companies seeking to engage with young customers, understanding these platforms and effectively leveraging their traffic and insights is essential. However, generational gaps often pose challenges in recognizing and capitalizing on emerging trends. To bridge this gap, companies need to ensure they have enough younger employees and creative talent to complement their typically older management teams. Just like how Tecent's Pony Ma puts it: 'In business, maybe you didn't do anything wrong—the only mistake was being too old.'
CNA
07-07-2025
- Entertainment
- CNA
Forget dusty cellars and sommelier jargon. Gen Z drinks with intention, not intimidation
Far from relying on long held tropes about wine drinking, today's youngest drinkers of legal drinking age are rewriting the rules of what it means to enjoy a good tipple. For this curious generation, savouring an alcoholic beverage is often less about status and more about storytelling. Whether it is a biodynamic sake from Japan, a juicy red from an under-the-radar wine region like Greece or Georgia, or a lesser known Italian white varietal, Gen Z wants bottles that reflect their identity, not their parents' palate. No surprises that social media aesthetics matter to this generation. For many of them, a bottle is not just judged by what is in it, but also by whether it is post-worthy. This is why eye-catching design, compelling backstories and a dose of cool factor can go a long way with digital natives who spend up to 42 per cent of their waking hours in front of screen. Consequently, even though wine brands still lag behind the slick marketing of big beer and spirits players, the rise of AI creative tools is already helping to level the playing field. With more accessible ways to craft engaging content, winemakers may soon have a better shot at capturing Gen Z's attention — and earning a spot on their feeds as well as their tables. As it is, while only about half of Gen Z (those born between 1997 and 2012) is currently of legal drinking age, their influence was impossible to miss at Vinexpo Asia 2025, a major wine and spirits trade show held in Singapore in May. The event, with over 1,000 exhibitors from 30 countries, highlighted a new wave of drinkers who value authenticity, sustainability and connection over tradition for tradition's sake. From masterclass tastings to panel discussions, producers and industry insiders alike acknowledged the rise of the next generation of drinkers who will shape what's in and what's out in the years to come. We take a closer look at what is actually filling Gen Z's glasses these days. THEY ARE CONSUMING LESS BOOZE First up, some sobering news for the industry: Alcohol consumption is on the decline globally and Gen Z is leading the charge. According to a March 2025 YouGov survey presented at a panel discussion at Vinexpo Asia, this generation is drinking significantly less than their predecessors in a shift driven by economic caution as much as lifestyle choice. In challenging economic times, young consumers with limited disposable income may not feel inclined to spend on non-essentials such as wines and spirits or entertainment, said Rob Temple, managing director of Sinowine and a Vinexpo partner, who took part in a panel discussion as part of The Vinexpo Academy's programme. Additionally, drinking less could also be a deliberate health and wellness choice, leading to more sober-curious consumers and dry nights. Even when they do dine out, Gen Z's favourite F&B haunts may not offer a full alcohol menu, or they may lean toward more affordable options. This could be why beer remains the top choice, with 37 per cent of Gen Z drinkers naming it their go-to, according to the YouGov survey. Philippe Chan, general manager of YouGov Hong Kong and China also noted the rising popularity of sparkling wines like Prosecco, which deliver a sense of premium indulgence without the champagne price tag. 'That is a big draw for younger drinkers who are looking for something celebratory but accessible,' he said. Also, there has been a fundamental shift in how this generation spends its leisure time by putting in more hours online and socialising virtually than going out in the traditional sense, said Temple. Accelerated by the pandemic, this change means fewer spontaneous bar nights, further contributing to the drop in casual alcohol consumption. But that does not mean they are teetotallers. Rather, they are being more intentional about what, when and why they drink. 'Gen Z is drinking less, but they are drinking better,' said Mason Ng, group wine director at Park90. 'Rather than multiple bottles, they might go for one really nice glass or a rare producer they have read about.' Wine communicator Jessica Anne Tan, who curated the masterclasses and panel discussions at Vinexpo Asia 2025 for the Italy pavilion, observed that younger drinkers in Singapore tend to value the communal experience of clinking glasses. 'Price is not a primary concern for them, it is about enjoying the moment together,' she said. For instance, many are happy to split a bottle among a group of 10 friends for the shared experience of enjoying a drink together. This shift is prompting a serious reimagination of traditional wine bar menus and pricing. 'It means rethinking our by-the-glass lists and finally moving away from outdated three-times markups. The future is about access, quality and experience, not just volume,' said Ng. STORYTELLING OVER STATUS For a generation that values authenticity and resonance, what is in the glass does matter, but why it is in the glass matters even more. 'Grape varieties and terroir are interesting, but this is not the starting point,' said Mason Ng. 'They are definitely more focused on whether the wine speaks to something bigger than just what is in the glass. What really matters is why the wine exists — the people who made it, the style of wine, and the story behind the bottle.' Bonus points if a bottle can spark wanderlust, with Gen Z gravitating towards tipple from places they have visited or dream of exploring. With Japan currently one of the most popular travel destinations, the 'Japan effect' is especially evident in the growing interest in sake. Ironically, while sake carries an 'old-fashioned' or traditional image among many young Japanese, it is enjoying a renaissance in export markets where Gen Z sees it through a different lens as cool, craft-driven and culturally rich. Besides sake, Ng has also noticed that young drinkers are curious about wines from under-the-radar Hokkaido, which is a popular winter sports destination. Italian wines too have benefitted from the surge in travel, with red and sparkling wines, growing in popularity. 'There is an emotional connection to Italy's rich culture, art, and culinary heritage, which many young people already admire. Italian wines bring that lifestyle to life in a bottle as they tell a story of place, tradition, and craftsmanship that younger audiences value,' said Matteo Zoppas, president of the Italian Trade Agency. ADVENTUROUS PALATES Forget Grand Cru snobbery or collecting labels for clout. Instead, Gen Z tend to prefer seeking out drinks that are different from what their parents like. For instance, they show a stronger preference for white and rose wines compared to reds, a more traditional choice among older drinkers, said Chan of YouGov. But it is the drinks with offbeat intrigue that really captures the younger generation's imagination, such as a pet-nat from Australia or a red from Serbia, observed Temple. This adventurous streak is backed by data. According to the YouGov survey, 63 per cent of Singaporean drinkers expressed interest in biodynamic wines, 55 per cent in organic and 48 per cent in sustainable labels, suggesting that provenance, ethics and process matter just as much as taste. When it comes to taste profiles, younger drinkers tend to prefer more 'approachable' wines that are slightly sweeter and lower in acidity and tannins. For instance, Tan has noticed a preference for Amarone and Primitivo wines from Italy, which offer a riper, jammy character which can be more appealing to younger palates.
