Just when it seemed the beverage industry had it all figured out when it came selling to millennials, in comes Gen Z.
GEN Z Brands is a new Arkansas-based, sustainably packaged bottled water brand that has taken its namesake from its target demographic. Putting branding ahead of product, the company launched online this month with a still water sold in reusable 20 oz. aluminum bottles. The product is available through the brand’s website for $5 per bottle (shipping is free) and is also available in 12-packs. Featuring colorful labels showcasing friendly “critters,” new bottle designs will launch in the near future.
According to co-founder and CMO Erin Campbell (a millennial), GEN Z intends to be strategic in its retail rollout and aims to be “judicious” in its spending. The company is planning for a regional launch in convenience stores and grocers in the Arkansas, Kansas City and Oklahoma City markets before a broader expansion across the country. The SRP will also be reduced with a retail launch, she said, with an aim to sell for about $2.50 per 16 oz. bottle and $2.75 per 20 oz. bottle.
“The Gen Z audience is the most marketed-to generation ever and because of that their B.S. meter is through the roof,” Campbell said. “So instead of trying to come up with some flashy name that means something but doesn’t really mean something, we just took the humorous on-the-nose tone of ‘Hey, we want Gen Z to buy this, so let’s call this GEN Z.”
A 2019 report by McKinsey & Company estimated that Generation Z accounted for roughly $150 billion in spending power and would account for 40% of global consumers in 2020, however it is unclear how the pandemic has impacted this.
The team behind GEN Z brings decades of beverage industry and brand development experience to the table. CEO Doug Batie (a boomer) previously spent 17 years with Welch’s, including six years as VP of Walmart, Sam’s Club and National Ecommerce. Chief growth officer Neil Mellers also hails from Welch’s, where he served as national account manager for omnichannel and before that worked with Acosta Sales & Marketing as a senior business insights manager. Campbell most recently worked as SVP of strategy and digital at marketing agency Saatchi & Saatchi X.
As a group of older professionals attempting to tap into the psyche of teens and twentysomethings, GEN Z Brands has also hired a “council” of three Gen Z advisors who provide insight into what their generation is looking for in a brand.
To promote the brand, social media and in particular Instagram and TikTok will play a big role in growing brand awareness and will be overseen by the Gen Z council, Campbell said. The National Retail Federation reported last year that 72% of Gen Z consumers said they were more likely to buy a brand they follow on social media and 75% said they engage with brands on Instagram compared to 16% who engage with brands on TikTok. The company is also preparing a broader 360-degree marketing campaign later this year.
GEN Z Brands worked with Los Angeles-based studio Day Job — which has designed the branding for Recess, Cha Cha Matcha and Taika — to develop the company’s identity. Day Job helped create the tongue-in-cheek messaging — including the callout that the brand is “Made by Real Boomers” — and designed its website as an homage to the ramshackle charm of early 2000s Geocities webpages, rife with animated GIFs and easter eggs intended to invoke consumers’ childhood nostalgia.
“It’s definitely pandering, that’s the whole strategy,” said Rion Harmon, co-founder and creative director of Day Job. “It’s an experiment in marketing: to do the opposite of ‘playing it cool.’ To show exactly what you are and what you want. And to genuinely have fun doing it.”
For GEN Z, the liquid inside the bottle is “simply the vehicle to sell an expression,” Campbell said. The water is sourced in Texas and goes through reverse osmosis purification, but is otherwise plain — a point that the company is happy to highlight as it bills itself as a “Flavorless Transparent Liquid.”
While the beverage itself may be presented under layers of ironic detachment, the company is, however, wholly earnest in its message of sustainability. GEN Z follows in the footsteps of brands such as PATH and Proud Source Water, which use “infinitely recyclable” reusable aluminum bottles, which Campbell notes positions the company as a “hybrid of consumable and durable” products maker. It is also why the brand places lower importance on the water itself — it’s more significant that consumers connect with the brand and reuse the bottle and fill it with the water of their choosing.
Having this authentic sense of purpose, Campbell said, is key — particularly for young Gen Z shoppers. According to a recent report by Trivium Packaging, 67% of consumers said they consider recyclable packaging an important quality in the products they buy and 83% of consumers under 44 years old said they would pay a premium for sustainably packaged products.
“Because [Gen Z consumers are] rejecting single-use plastic, you are seeing them quickly exit the bottled water category and turn towards these reusable water bottles like Hydro Flask,” Campbell said. “But the inherent problem with the Hydro Flask is if I lose it, if I leave it at home, they’re incredibly expensive. So you’re still seeing a need for this convenient, affordable hydration.”
The dual emphasis on sustainability and branding draws comparison to Liquid Death, which sells canned mountain water with gallows humor-laden, heavy metal-themed messaging. The initial sales and fundraising success of Liquid Death has provided a model in the bottled water category for disruptive branding plays that also place an emphasis on sustainability and quality, but GEN Z is still a step removed from that product.
Whereas Liquid Death highlights the quality of its water sourcing, GEN Z makes its water humorous. Whereas Liquid Death’s founders were reared in the underground hardcore music scenes that inform its identity, GEN Z is founded by older career professionals who acknowledge their positions as marketers and make it a selling point. There could also be a lifecycle problem awaiting the newer brand: whereas death is eternal, Generation Z is not.
Young generations with large buying power are hot targets for marketers, but building entire brands around specific generations has historically led to mixed results, particularly as those consumers get older and younger shoppers assume their place. While Jones Soda managed to authentically connect with Gen Xers in the 1990s and 2000s as an alternative CSD brand, sales stalled in the past decade as the company failed to sufficiently innovate enough to retain its consumer base. The Coca-Cola Company’s OK Soda — a 1990s product which attempted to invoke the anti-consumerist mindset of young Gen X consumers through alt-comics artwork and ironic marketing — was short lived, lasting less than a year on the market in 1994.
But Campbell believes that GEN Z, the brand, is striking at the right time and is poised to grow and evolve with its namesake demographic. That means being flexible and will very likely involve doing more than just water.
“Gen Z is just getting started,” she said. “We’re aging into the first ones graduating college and entering the workforce. So we see a lot of unique life stages that are ahead of them — buying a house, getting married, getting their first job. So we can grow with them through those life stages, whether it’s through branding initiatives or product extensions. We’re really excited about capturing this really critical consumer along their lifetime journey.”