Gen Z is fast becoming a powerful and influential purchasing demographic, but not all referral programs are built with them in mind. While the most successful brands have learned to adapt to modern consumer behavior, many brands are stuck using outdated email-era tactics in their referral programs. With Gen Z now making up 40% of global consumer spending, reaching them is no longer an afterthought–it is mission-critical.
To capture the attention of this generation of tech-savvy digital-natives, marketers must learn to speak their language. That means designing a referral marketing strategy that speaks to what Gen Z values most from their favorite brands: authenticity, efficiency, and flexibility. Read on to discover our best practices for building a referral program that Gen Z will actually use.
What We Know About Marketing to Gen Z
Gen Z trusts people, not brands
Gen Z’s cultural mistrust of corporations makes them intimidating to many marketers. Their anti-corporate rhetoric doesn’t mean Gen Z isn’t spending–it just means they look to other trusted sources to guide and validate their consumer choices. For example, 77% of Gen Z rely on friend recommendations and are more influenced by peer referrals than traditional ads. Prioritizing your referral program over paid ads is a smarter way to reach those consumers who need peer proof before converting.
Of course, social media influencer culture also has a considerable hold over Gen Z’s purchasing behavior. A recommendation from an influencer can hold just as much weight as that of a friend, with 70% of Gen Z following at least one and 50% making purchases based on influencer recommendations.
Gen Z is mobile-first (and impatient)
It is no secret that this generation lives and breathes technology (the average Gen Z checks their phone 76 times a day!). Thanks to their affinity for all things digital, Gen Z consumer habits are markedly different from those of older generations. A stunning 96% of Gen Z consumers shop via smartphone at least monthly, and 63% rely on social media to discover new products. They are mobile-first consumers, and they are used to highly-efficient, fully digital consumer experiences.
Gen Z values control and flexibility
Perhaps even more than seamless digital journeys, Gen Z values flexible experiences, and a strong sense of consumer agency. One example of this is the rise of “buy now, pay later” (BNPL) solutions that allow buyers a more flexible payment option–62% of Gen Z have used BNPL, and that number is projected to continue to rise. Similarly, Gen Z prefers a transparent and self-directed referral experience–they want to understand the fine print of what they’re signing up for, and they want fewer restrictions on how and when they are rewarded.
Referral Best Practices: How to Build With Gen Z in Mind
Though they may seem elusive to marketers, Gen Z’s respect for peer recommendations makes them the ideal candidates for a referral program. If you make an effort to adapt your referral marketing strategy so it aligns with this generation’s demand for authentic, flexible, digital-first experiences, you will see just how powerful word-of-mouth marketing can be amongst young consumers.
The following are some best practices for designing a referral program with Gen Z in mind.
1. Make Sharing Easy and Native
Gen Z lives on mobile, and they expect everything, including referrals, to work with a tap. Don’t make them copy-paste referral codes or dig through their email to find a share link. Allow users to share and redeem via one-tap in-app share buttons, digital wallet QR codes, and social-friendly links that feel like native to their digital experience. The more seamless the customer journey, the more likely they’ll be to follow through–and even refer again.
2. Promote Your Referral Program Beyond Email
The goal of any referral program is to turn as many of your customers as possible into advocates. Strategic promotion is key to ensuring the visibility of your referral program–but reaching Gen Z customers might look a little different from other demographics. Instead of relying solely on marketing emails or onsite placements to promote your program, surface your referral program across social media, push notifications, and SMS. Meet Gen Z where they already are, and make your referral CTA feel more like a social flex than a marketing message.
3. Let Them Personalize Referral Invites
When it comes to marketing messages, Gen Z values authenticity over sizzle. Give your advocates a chance to personalize their referral invitation so it feels like it’s coming from a friend, not an anonymous marketer. Make sure referral share messages include the advocate’s name as social proof, for example, “Your friend Katie thinks you’ll love us!”. When a recommendation comes in the advocate’s real voice, it’s more likely to be trusted (and clicked).
4. Offer Rewards They Actually Want
If you want to encourage long-term engagement with your brand, rewarding Gen Z advocates with the same discount code every time isn’t going to cut it. Gen Z wants unique rewards: think e-gift cards, brand credit they can bank, or limited-time drops that create urgency. Offer a variety of rewards even for minor actions like writing reviews, and implement a tiered reward system that keeps them engaging beyond the first purchase.
5. Prioritize Freedom and Flexibility
Limits on referrals? One-size-fits-all incentives? That’s not it. Gen Z responds to referral programs that feel open, gamified, and self-directed. Let them see their impact, earn over time, and track their progress like a loyalty badge. Let them choose how and when to redeem — they’ll value the control.
Give customers the rewards they want with Extole’s Reward Bank extension. Reward Bank gives advocates a single place to track, build, and redeem multiple referral rewards, inspiring actions across every step of the customer journey. Schedule a demo to see it in action.
6. Opt for Transparency
Gen Z values authenticity in all brand communication, from marketing materials to onsite copy. You’ll win them over not with persuasive language, but with transparency and directness. Make sure your referral program description contains clear requirements and benefits, so advocates and referred friends know exactly how to earn and redeem their referral reward. The more straightforward the process, the more likely referrals and advocates will be to participate. Clear requirements also help reduce the risk of WISMR (“where is my reward”) requests, saving you time and energy.
Ready to Make Gen Z Your Growth Engine?
Gen Z represents a new kind of consumer with distinct values, expectations, and influence. They crave authenticity over polish, speed over friction, and control over constraints. Brands that recognize these traits and evolve their referral programs according to these best practices will be poised to build valuable, lasting relationships with Gen Z customers.
Extole’s enterprise referral marketing platform helps you launch and manage sophisticated referral and engagement programs that capture consumer attention and drive real results. Schedule a demo to see how it can help your business supercharge growth.
