Although Gen Z might be young, they are pretty tuned in to the world of investing. According to a 2021 Bloomberg survey of college students across Asia and EMEA, 46% of the polled students made personal financial investments in 2020. In fact, 45% of respondents think investing is important "for a better tomorrow", while 25% said they are investing to feel financially secure, and 19% of them were looking to maximise wealth by investing. Of the students who made investments, 75% invested in stocks, 7% invested in bonds, 7% in Bitcoin and the remaining 10% in other assets.
There is also no dearth of investment apps in the market these days, from Endowus and StashAway to Syfe, Coinhako, and futu to Wahed Invest and MYTHEO. Hence, there is certainly a need for apps to cut through the clutter and make their marketing stand out to draw in the up and coming Gen Z youths.
Through its research and observation, Syfe, a Singapore-based investment app, said Gen Z audiences however have their own drum that they beat to and generally, shy away from product-driven marketing. What they do want to know is how a product benefits their lives and fits into their lifestyle. Its VP of distribution, Sebastian Sieber, told MARKETING-INTERACTIVE that the brand's efforts on TikTok, for example, focuses on financial education, tutorials, and genuine stories from users to encourage trial. "Whether it's TikTok videos or some of the most popular influencers among the Gen Z audience creating content, we tailor our messaging and ensure that it fits exactly to the type of format that will work for each channel," he added.
While TikTok might be a popular channel among Gen Z, Sieber explained that Millennials are also one of the fastest-growing user base for TikTok in Singapore. The social media platform has proven to be a great platform to educate Syfe's audience on the importance of investing but the way the message is delivered is key. For Syfe, it uses light-hearted, fun, and approachable investing content to target users. "We find that TikTok yields high-quality users for us when looking at the lifecycle of a client from funding to additional top-ups," he added.
A core part of Syfe's users are between 25 to 45. They are generally well-educated, earn a mid to high disposable income, and are digitally-savvy. They also appreciate the advancement of technology within the realm of investing. As of now, the brand does not employ different strategies for different groups, but rather looks at the suite of marketing channels available to Syfe and tailors its efforts to suit the demographics and practices that work best for each channel. Aside from TikTok, it is also present on Facebook, Instagram, Twitter, LinkedIn, and YouTube.
Aside from creating fun and light-hearted content, having relatable stories also works for Gen Z. Jason Huan, CMO of Singapore-based investment app Endowus, explained that profiling its clients and their investing journey through advocacy campaigns have paid dividends for the brand, as Gen Zs felt that they can relate to the advocates’ stories about their financial journeys.
For this generation, content is still king, as the economic downturn brought about by the pandemic had accelerated the demand for investment content.
As such Endowus focuses on improving financial literacy for Singaporeans through its platform. Like Syfe, Endowus' key demographic focus is also between the ages of 25 to 45, and these individuals have largely invested across CPF and cash, followed by supplementary retirement scheme monies. That said, it has seen healthy growth in the proportion of younger investors aged between 21 and 35 on its platform.
"This proportion grew from 29% in January 2020 to 45% in January 2022, partly driven by lowering our minimum investment from SG$10,000 to SG$1,000, and that helped to broaden our Gen Z client base," Huan said. He described Gen Z to be "a real growing force in investing", adding that these digital natives do not have the same deep trust in institutions in their parents’ generation, and are more open to trying out new digital platforms and new technologies. The new generation has also shown to be more financially conscious than previous ones, as many are recognising a need to plan early for their retirement, he said.
When asked how Endowus' strategy differs for Gen Z, Millennials, and Gen X, Huan explained that the differentiation is really about understanding what each generation cares about when it comes to their financial journey. Specifically for investing, it is being able to clearly identify their priorities at their life stage and setting them for future financial success.
"We’ve also seen a lot of demand and interest in self-education in the younger generation, but the way Gen Z youths seek financial advice is different compared to older investors, for example they do so via digital channels and social media," he said. While Endowus began its presence on social with Facebook and Instagram, and has since diversified into YouTube and as well as TikTok, with the latter being one of its media channels for the acquisition of Gen Z clients.
"What’s key behind the success of these channels is that they are not directed on Gen Z acquisition alone, but mainly on how effective these channels are in driving engagement and conversations across its user base," Huan explained.
Aside from social media channels, Endowus is also curating and producing content on its Endowus Insights page for investors to become more financially savvy. It has also partnered with content platforms such as The Smart Local to help further extend that reach. At the same time, Endowus also named Jamie Lee, former deputy editor at The Business Times , to head up editorial and content in February.
So what are the popular investments by Gen Zs? Cryptocurrencies, is a clear contender. A study by New York City-based financial website, Investopedia, said about a quarter of the Gen Z it surveyed for its 2022 Investopedia Financial Literacy Survey hold cryptocurrencies and stocks and one in 10 own NFTs.
Riding on memes
Facebook, Instagram, and TikTok might be some popular avenues for investment apps to target the younger crowd. Futu Singapore's investment platform, moomoo, is also switching up its content strategy by riding on the trend of memes and short-form comedy to initiative conversations. The moomoo Humour page, for example, was established as a platform m for users to share and engage with investmentrelated memes and the likes. This is being supplemented with a club for users to redeem moomoo merchandise when they obtained sufficient points in-app by completing task-based learning to level up their financial literacy.
At the same time, moomoo hosted paper trading competitions, giving beginner investors US$200,000 in virtual money to practice their investing strategies and gain confidence before they trade in the real world. According to Futu Singapore, this was highly popular with over 10,000 unique participants in Singapore for each competition.
Currently, 10% of Singapore's adult population over the age of 20 are moomoo users. More than 70% of its users are also Millennials and Gen Zs, between the ages of 18 and 41.
In creating strategies targeted at Gen Z, compared to Millennials or Gen X users of the moomoo application, Erika Chiang, head of marketing, APAC, Futu Holdings told MARKETING-INTERACTIVE that it is important to characterise what their needs may be and the type of lifestyles they are leading.
For example, it found that Gen Z users of the moomoo app have a lower capital and are looking at investing from a fresher pair of eyes compared to their older counterparts. Often, they join digital platforms without a pre existing portfolio or a background in investing. However, their Millennial and Gen X counterparts are by large more seasoned investors with higher capital to reinforce their portfolios.
Thus, its strategy for Gen Z users is based upon financial literacy and offereing them a myriad of resources to fortify their knowledge of investing. While its strategy for Millennial and Gen X users are also based on financial literacy, the focus is shifted towards educating them on how they can further build on their portfolios.
"Gen Z and Millennials want investing to be made easily digestible, less dry and less intimidating while incorporating a social element, and tools and resources that help them to level up on being financially literate," Chiang said.
Interestingly, moomoo Gen Z investors are more active than Millennial ones, with the former having more daily logins and browses and saving more stocks to their watchlist and trading more frequently. Moomoo's real-time chat forums are also buzzing with new messages daily, with Gen Z sharing their stock performances with some even offering to help others understand various financial terms and strategies better.
Challenges faced when targeting Gen Z
Although Gen Z might be interested in investing, they are not doing so haphazardly. In fact, brand reputation still triumphs when it comes to winning their hearts. Alrick Oh, VP of marketing at crypto exchange Coinhako told MARKETING-INTERACTIVE that building brand credibility can be a challenge as Gen Z tend to have very distinct criteria in brand selection compared to other age groups. "Market research has shown that the younger generation have less inherent trust in new/digital banks and financial institutions. As such, building a trustworthy and relatable brand is particularly important for such a user segment," he added.
As such, Coinhako's overarching marketing strategies does not focus on user age groups. Instead, Coinhako conceptualises and executes campaigns on the basis of connecting with as many users who are interested in its products and services as possible. The company also employs an omnichannel strategy across multiple channels, including social media platforms, to engage with a wide range of retail and institutional customers who are interested in its products and services. "Our main consideration for which platforms to be on is that it has to have the strongest synergy with the markets we serve, and it has to be aligned with the existing regulatory frameworks," he said. Coinhako currently has a presence on Twitter, Facebook, Instagram, and LinkedIn.
Similarly, Syfe's Sieber said the authenticity of a brand's content is also crucial for Gen Z. "This is more pronounced in our industry where trust-building is key," he said. Sieber understands that a cookie-cutter approach across platforms will not make the cut, and users are seeking real, genuine content that resonates with their beliefs, goals, and stage in life.
Aside from these, the biggest challenge is the rise of "fin-fluencers" and a surge in financial content on social media platforms that target the digitally, but not necessarily financially-savvy, Endowus' Huan said. While social platforms provide greater and easier access to a broad range of content, increasingly, Huan explained that there have been influencers are who stepping in to promote financial platforms and products, some of which promise quick returns even for those who know nothing about investing.
"As a rule of thumb, if it’s too good to be true, then it probably isn’t true. The younger generation may fall prey to such get rich quick schemes and investment fads without necessarily understanding the risks involved," he said. He highlighted the rise of investment "gurus" claiming how one can make quick wins on social media. "Many have claimed that they provide the strategies experts use and all you have to do is replicate those for financial success. Youths should not be enamoured by the high returns from buying meme stocks or speculating on cryptocurrencies. The hope of attaining financial freedom through speculative investing is not a plan for financial success," he said.
Hence, it is important that consumers do their research and verify the information they find online before taking action, especially when it comes to more risky advice, such as investing in the stock market or in cryptocurrency.
Meanwhile, Futu's Chiang also weighed in on the issue, saying that its challenge was to ensure young investors continue to have the financial literacy resources they need to make smart trading decisions as part of their long-term financial planning for retirement, savings for healthcare and medical treatments, and having extra cash for rainy days.
When it comes to investing, Chiang said that the best defence against myths and misconceptions is financial education. In an effort to make investing less daunting for Gen Z, Futu Singapore partnered with SAFRA Youth Network to broadcast a Facebook Live video on “Investment made easy through debunking myths and misconceptions”. Through moomoo, Futu Singapore has launched more than 300 videos and courses, while partnering over 30 financial institutions, unicorn companies and universities to reach out to the next generation of investors.
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