Business

Small Business Tips to Protect and Win the Loyalty of Gen Z

The younger generations are naturally digitally savvy, right? According to recent research, this isn’t necessarily the case. In fact, the younger generation’s lifelong familiarity with digital experiences seems to have left them uniquely vulnerable to theft and fraud.

Generation Z represents more than 20 percent of the U.S. population. Its oldest members are now approaching the quarter-century mark, while the youngest are just a few years shy of adolescence. Most have never known a world without smartphones and online shopping. Even so, having the “digital native” status hasn’t protected them from falling victim to schemes.

According to recent data collected by Allstate, the youngest adults and teens are the most likely to be locked out of a hijacked account and have unauthorized credit card or bank changes. Surprisingly, they are also more likely than older adults to fall for phishings scams and have a negative customer experience.

Eccommerce Challenges for Gen Z

Of course, these unfortunate incidents for Gen Z create challenges for eccommerce merchants as well. More fraud and declines for these customers means less trust in brands overall. A 2021 ClearSale survey found that Gen Z experiences a disproportionate number of declines by merchants. When they’re declined, these customers are less forgiving than average.

Nearly 45 percent say they won’t shop again with a merchant if their order is declined (compared to 40 percent across all age groups). Another 42 percent say they will go a step further and post something negative about the merchant on social media after a decline (higher than the 34 percent average).

How to Protect Gen Z Customers

So, how can you protect your brand’s reputation and safeguard Gen Z customers’ from fraud and false declines? There are several key things to keep in mind.

Use data. You can use data to adjust and refine order screening in a way that fits each of your sales channels. Good orders approved, blocked fraud, completed fraud, and good orders mistakenly rejected all need to be monitored. This will help you determine where the highest rate of fraud attempts are taking place – and the highest rates of false declines – and then take measures to correct those issues.

Identify behaviors. Utilize artificial intelligence to discover and monitor customers’ behavior, both good and bad. AI can help you analyze data like velocity of recent orders, customers’ purchase histories, behavioral biometrics and so much more.

Understanding the unique challenges Gen Z faces is the secret to winning their loyalty and ironing out any fraud and false decline issues. Reduce losses and grow customer lifetime value at the same time.

Blair Thomas has been a music producer, bouncer, screenwriter and for over a decade has been the proud Co-Founder of eMerchantBroker, the highest rated high risk merchant account processor in the country. He has climbed in the Himalayas, survived a hurricane, and lived on a gold mine in the Yukon. He currently calls Thailand his home with a lifetime collection of his favorite books.

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