How Younger Audiences Are Upending Traditional Social Ad Strategies

The COVID-19 pandemic has shifted the way people shop. According to a report from J.P. Morgan, the pandemic has pushed more shoppers online, with e-commerce now accounting for 16.1 percent of all U.S. sales. That’s up from 11.8 percent in the first quarter. This trend is likely to stick, even as brick-and-mortar stores open their doors again. One way in which shopping habits changed was across social media platforms.

Social platforms have recognized this change and are adapting their marketing strategies by making it easy for consumers to purchase via their favorite platform. The number of social commerce shoppers grew by 25 percent from 2019 to 2020, according to an Insider Intelligence report, from almost 64 million to 80 million consumers who bought items through apps like Instagram, Facebook, and Pinterest. That number is expected to surpass 100 million by 2023.

In our latest report, “2022 Social Consumer Advertising Preview: How Gen Z’s Views on Spending Will Transform Buying,” we analyzed how social media advertising influences purchasing habits across generations. Key findings are below.

Gen Z and Millennials Drive the Push for ‘Buy Now, Pay Later’ on Social

When asked if they’ve ever purchased a product that featured a buy now, pay later option (BNPL) in a social ad, over half of millennials (60 percent) and Gen Zs (57 percent) said “yes,” vs. 37 percent of Gen X and 19 percent of baby boomers.

BNPL options have grown in popularity as a way to keep up with the rapid shift to online shopping during the pandemic. Our analysis discovered that consumers of all generations use BNPL tools, but millennial and Gen Z shoppers are doing so at much higher rates. This is likely because BNPL provides younger consumers — whose cash flow tends to be more limited — increased financial flexibility, especially for larger-ticket items.

Millennials Want All the Details in Their Social Ads

Per the study, nearly 60 percent of millennials (58 percent) prefer to see all of the details about a new product or brand in an ad, and don’t want to have to go to a company’s website to learn more.

The way millennials consume information is very different. They're analytical and they want access to information on-demand. This also speaks to the need for retailers to work more closely with social platforms since linking out to their own dedicated sites can seem cumbersome.

Fifty-six percent of Gen X agree with millennials, while Gen Z are split on the topic, with no preference either way. However, baby boomers (55 percent) prefer to see less in an ad, and would like to discover more about the product or brand being advertised by visiting the company's website.

Instagram Most Likely to Influence Purchase Decisions for Gen Z

Fifty-nine percent of Gen Zs shared that Instagram’s advertising influences their purchasing decisions the most, followed by TikTok (57 percent), Facebook (36 percent), and Twitter (29 percent). For the best ad experience, Gen Z touted Instagram (59 percent), followed by TikTok (48 percent), then Twitter (34 percent).

Nearly Two-Thirds of Millennials Have Tried a New Brand Because of a Social Ad

Sixty-three percent of millennials, 56 percent of Gen Xs, and 52 percent of Gen Zs said they’ve tried a new brand or product based on an ad they saw on social media in the past month. Baby boomers, on the other hand, aren’t as influenced, with only 33 percent responding that they’ve tried a new brand or product based on a social ad in the past month.

Millennials are the most likely to try a new brand or product based on social ads seen recently. Boomers are the least likely, but still, one-third said they’ve discovered a new brand or product after seeing an ad, which is above and beyond return on investment from other channels.

Surprise, Promo Codes and Coupons Are Key Conversion Drivers

When asked if they were more likely to purchase something based on an ad if it featured a promo code or coupon, 96 percent of millennials and Gen X were very likely to do so. Ninety-four percent of baby boomers agreed, along with 89 percent of Gen Zers.

Almost Half of Millennials Will Recommend Products Based on a Social Ad

Just 13 percent of baby boomers and 29 percent of Gen X are likely to recommend a product to a friend or family member based on an ad that they saw on social media. In contrast, almost half (46 percent) of the millennials and one-third (34 percent) of Gen Zs shared they're likely to make such a recommendation.

Video Ads Conquer Over All Other Forms of Social Advertising

Millennials (79 percent), Gen Xs (71 percent), and Gen Zs (59 percent) are more likely to click on a personalized ad on mobile vs. desktop. Meanwhile, the majority (53 percent) of baby boomers said they’re more likely to click on a personalized ad via desktop.

All generations (baby boomers, 48 percent; Gen X, 59 percent; millennials, 52 percent; and Gen Z, 63 percent) agree they’re more likely to click on a video ad over any other format.

Historically, advertisers have considered video a top-of-funnel tactic. Now, though, more marketers are using video for direct response and brand awareness. New ad formats across Facebook, YouTube, Twitter and other social apps allow marketers to collapse the funnel, giving users a frictionless experience from discovery to conversion.

As social media becomes more commerce-focused, these findings will help advertisers and agencies optimize their strategies in Q4 and beyond. Younger generations are changing the way retailers and brands need to think about their social strategies. They’re buying differently, seeking specific types of information from their ads, and prefer certain formats over others. These trends will continue to shape performance and drive consumer engagement across top social platforms.

Bryan Cano is the senior director of media strategy at StitcherAds, a company building technology to help advertisers scale full-funnel performance marketing campaigns on Facebook, Instagram, Pinterest and SnapChat.