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The Changing Industrial Ecosystem Driven by Generation Z, Industry Must React Sensitively
  • By Kim Min-seong, reporter
  • 승인 2024.05.19 23:56
  • 호수 333
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▲ Generation Z, exposed to digital environments from childhood (Source: Pexels)

Since the onset of the Covid Pandemic, Generation Z, which has garnered increased attention, has been reshaping various industries. Born between 1995 and 2010, Generation Z is often dubbed "Digital Natives,” meaning that they have been exposed to diverse digital environments from a young age. With their massive consumer power amounting to $450 billion and comprising 27% of the global workforce, the consumption characteristics of Generation Z are causing disastrous consequences in the global industrial ecosystem. The World Economic Forum (WEF) analyzed their consumption patterns as, “considering both the uniqueness and ethics of products.” Especially, TikTok, which has emerged as the world's leading platform company since the Covid Pandemic, seems to be accelerating these changes.

TikTok took the lead in creating virtual spaces for interaction during the Covid pandemic. As a result, it surpassed Google and claimed the top spot in the 2021 ranking of "most visited domains.” TikTok's content spans various aspects of daily life, challenges, DIY tips, hobbies, and mukbangs (eating shows creating an audio- visual experience for the viewer). Due to its distinct platform culture compared to previous generations, nearly 70% of TikTok's total users are under 39 years of age, with over seven million businesses using TikTok in the United States alone.

Generation Z's unique preferences significantly influence the artisanal market. For instance, hashtags like #crochetforbeginners received 196.4 million views, #tuftingrugs received 397.4 million views, and #basketweaving received 20 million views on TikTok. This increased interest in traditional crafts among Generation Z has also impacted exhibitions. For example, the Metropolitan Museum of Art in New York hosted an exhibition featuring Japanese kimono styles. Even domestically, kits for making one's own wool felt dolls, which are affordable and easy to use, are gaining popularity among Generation Z. Lee Su- bin, a computer engineering student at CWNU who enjoys making wool felt dolls as a hobby, cited her experience that, “there’s an advantage of being able to easily create one's own doll with inexpensive kits.”

The ethics of companies also have a significant influence on Generation Z's spending habits. On February 22nd, Gary Pilnick, CEO of the American convenience foods and snack manufacturing company Kellogg's, appeared on CNBC for an interview about rising food prices. He mentioned eating cereal for dinner to cash- strapped consumers, sparking controversy. Despite remaining silent amidst the criticism, the controversy grew, and the hashtag #BoycottKellogg spread on TikTok, garnering over 20 million views. This movement evolved into a trend of sharing content on making snacks or cereal from scratch at home, where increased interest in the topic also increased the popularity of TikTok stars like Nara Smith. Furthermore, among consumers, a new term "greedflation," which views current inflation as corporate greed, has emerged. Sarah Butler, an American pursuing a graduate degree in Business Administration at CWNU, explained, "Generation Z in America has a decreasing trust in the quality of mass- produced goods along with increasing concerns about food additives, while an emphasis on ethical, environmental, and economic issues is spreading through American society."

Since the announcement of the National Pension Service of Korea's expansion of ESG (Environmental, Social, and Governance) investments in 2019, domestic companies have followed the suit. However, voices of difficulty are emerging from small and medium- sized enterprises (SMEs) with less manpower and financial resources compared to large corporations. The government is making efforts to support ESG transitions tailored to current issues, such as through the solicitation of proposals for "ESG consulting support for SMEs." Market evaluations consider such transitions as critical factors determining corporate competitiveness and sustainability. Moreover, a significant shift in advertising strategies will bring both opportunities and challenges to domestic companies. Therefore, the industry is sensitively responding to the changes brought about by Generation Z, and the government's support is expected to further enhance competitiveness.

By Kim Min-seong, reporter  20221240@gs.cwnu.ac.kr

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