Generations of Brands | Analysis of brands by generation yields lessons about relevance
GenZ brands dominate Global 100, in number of brands and value
Global BrandZ Research Director
“If I have seen further it is by standing on the shoulders of giants.” Isaac Newton
Newton’s famous quote rightly suggests there is much to be learned from using the past as a springboard for future success. However, given the inexorable march of technology and its impact on consumer needs and expectations; in the world of brands there is also much the old can learn from the new in the quest to adapt, modernize, and sustain success.
BrandZ™ has been gathering consumer data for over 20 years and during that period an entirely new generation of person has emerged. GenZ, whose members are also known as Centennials, first appeared in 1996. Applying the commonly recognized generational designations to brands in the 2019 BrandZ™ Global Top 100, we find that brands are fairly evenly distributed by age among GenZ (1996-to-present), Millennials (1977-to-1995), GenX (1965-to-1976), Boomers (1946-to-1964), and Traditionalists (pre-1946).
Analysis revealed that brands—like people—are shaped by generational characteristics. For example, they differ in personality traits, distinctiveness, and ability to build and sustain trust. Understanding brands in the context of their generational influences can yield useful insights about brand behavior, which can help gain competitive advantage and grow sustainable value.
GenZ brands dominate
When considering the distribution of Top 100 value by generation we see the greatest proportions at the two chronological extremes. Traditionalist brands account for an impressive 25 percent of the total value, suggesting they maintain a great deal of influence today despite an average age of a more-than-elderly 127. However, at the other end of the scale there is an even more dominant group, the GenZ brands. These brands were founded on average only 16 years ago, but they include almost a quarter of all brands in the ranking and account for a sizeable 34 percent of the total value. Quite an achievement for a group of teenagers!
The progress and potential of GenZ brands is even more striking, however, when considering recent rates of brand value growth. In the last year alone, these brands have grown in brand value by a colossal 21 percent, outstripping the next highest group (Millennials) by a factor of nearly three. In contrast, the growth rate of Traditionalists is beginning to wane, and these brands are the only group whose brand value declined over the last 12 months. So, what defines these generations of brands and how do consumers perceive them to be different from each other?
Personality Interestingly the personality of each group is different and even seems to match some of the human personality traits we may naturally associate with each generation. Where Traditionalist and Baby Boomer brands are particularly trustworthy, wise, straightforward and friendly, GenX and Millennial brands are defined by their creativity, a trait they share with GenZ brands—also defined by a dash of adventure and rebellion, which we often associate with the youthful.
Brand Equity Digging deeper into the specifics of brand equity, two groups set themselves apart—GenZ and Baby Boomer brands. Though all five generation groups are strong in equity versus typical brands (they are in the Global Top 100 after all), Baby Boomer and GenZ brands excel in all three of the key building blocks of brand equity: Meaning (meeting needs in a relevant way), Difference (standing apart and leading), and Salience (coming to mind easily at the time of consideration). In particular they have the ability to meet rational needs and make an emotional connection with consumers, and they have high levels of Salience. Both groups have clear potential to grow further in the future.
Building Meaning and Relevance Interestingly, the way these groups derive such strong meaning to consumers seems to follow two different paths. Whereas Boomer brands have established strong trust credentials over a long period of time, insulating them from more recent competitive disruptions, GenZ brands bring innovation, dynamism, excitement, and immediacy to cater for a new generation of consumer needs. Interestingly, both generations of brands are the next best performers in the other group’s main areas of strength.
- Compared with Millennial, Gen X and Traditionalist brands, Boomer brands are more dynamic, innovative, and disruptive. Walmart (founded in 1962) is a good example of a modernizing Boomer. It continues to grow brand value and defend against the threat of Amazon by investing at scale in technology.
- On the flip side, the most successful GenZ brands have built strong trust credentials very quickly with reliability of service and seamless experience delivery. Gen Z brands like PayPal (founded 1998), Netflix (founded 1997) and Google (founded 1998) are among the most trusted brands in the BrandZ™ Global Top 100. (Jack Ma, founder of Alibaba, certainly understands the need for emerging brands to establish their trust credentials quickly: “For e-commerce, the most important thing is trust. Put the customers first, the employees second, and the shareholders third.”)
This analysis indicates that to establish and retain relevance, brands must consider two elements. A solid foundation of trust and reliability plus an ability to meet emerging needs via the flexibility of mindset required to adapt, innovate, and ultimately embrace change.
So, what can you learn from predecessors, peers, and newcomers to maintain relevance for generations to come? Whose metaphorical shoulders is your brand standing on?