At NRF, execs from H&M, McDonald’s, and Spotify decode what digital strategies work best for Gen Z

Much like in previous years, NRF’s Big Show featured many hot topics, including retail media networks and AI in the industry.

But one panel led by Hilary Milnes, executive Americas editor at Vogue Business, focused on a subject that’s captivated retailers and companies big and small for years now: What does the Gen Z consumer want and how do you give it to them?

And while this generation’s preferences probably change more rapidly than the weather in New York, we know that if there’s one thing that’s constant, it’s that Gen Z is a digital generation.

To understand what digital strategies work best to engage Gen Z customers, executives from H&M, McDonald’s, and Spotify sat down to provide their insights. We’ve rounded up their best advice to help retailers remain at the forefront of reaching the younger audience online.

These interviews have been lightly edited for length and clarity.

Linda Li, head of customer activation and marketing, H&M Americas

You do think of [Gen Z] as always being on digital platforms. They consume everything across digital platforms—they browse, they learn, they experiment. But what we have seen is that the Gen Z customer actually prefers to shop in stores. That’s been something that’s been a huge learning. The reason for this is because the store experience allows for more personalization. That allows for more socializing as well—especially in the post-Covid era—[they’re] wanting to do things with friends or peers. There’s so much of that happening in the in-store shopping experience. A big part of it is really the desire for self expression, which I think we’ve heard really helps define this generation quite a bit. That’s wonderful because the in-store shopping experience can really enable that.

But I also think that as brands and retailers, it becomes incumbent upon us to really deliver on in-person experiences that can be differentiated, and that can allow for that aspect of personalization and self-expression. As an example, we’re looking into things like Spotify playlists that we play in store. We have fragrances that are customized to some of our stores. We had this in our Williamsburg potluck that we did last year, and customers would come in and engage with the store and engage with shopping series in a totally different way.

Caleb Pearson, VP of US customer engagement, McDonald's

Some of the things we’ve learned across the last three years with this group that I found interesting is one, who they trust is completely different than past generations. They have the least amount of trust in political figures. I’m not sure if anyone has trust in them anymore, but [Zoomers] really trust people who are like them, who are within their generation—and they’re YouTubers, your Instagramers. They also are massive content creators and content consumers, particularly in the digital world.

The most interesting is Gen Z’s rejection of this false perception of dichotomies. They want to save, but also want to splurge. Gen Z can want digital experiences, but they also want real-life experiences. Gen Z can want to be activists and have their voice heard and drive social change, but they can possibly have moments of pacifism and peace in their lives. Most importantly—maybe most important for us—is that they can love local brands and local food. They can also have an appreciation for big brands and for the convenience and the value that those brands bring to their lives.

Ann Piper, head of North American ad sales, Spotify

Spotify Wrapped is over 11 years in the making. It’s been one of our greatest accomplishments. Everyone’s willing to share a little personal data. But we’ve done it in a way that it’s kind of a surprise and delight. So every year, we’re really trying to get better about, “What city do you most relate to?” Also, [we’re] really working with artists to better understand, “Here’s where you’re accomplishing.” Through the years, that’s a really big superpower is to just understand the kind of moods and moments…we are not trying to portray who you want to be. Spotify Wrapped really is who you are. But it’s a really great way to connect globally. So 1 out of 10 global citizens have the opportunity to interact and so it’s just a really great way for us to continue to stay connected.