The student debt crisis is a growing problem and a big concern for today’s college students. Here, we cover the key things your brand needs to know, and the next steps you can implement to ensure you reign supreme with Gen Z consumers – securing brand loyalty that lasts way beyond college years.
Student debt – a crisis for your young consumers
College is a huge investment in a student’s educational journey, and it’s also a huge financial decision to make. Over the last two decades, the net price of tuition, fees, room and board at a public college (for a standard period of four years) has increased by a massive 68%. At the same time, money borrowed by students in order to attend college has doubled – adding to an ever-growing collective federal student loan debt of around $1.6 trillion dollars, according to the Federal Reserve Bank of New York.
As far as actual cost per student goes, researchers from Lending Tree found that the average cost of college (tuition, fees, room and board) for the 2017–2018 class was $20,770 for public schools and $46,950 for non-profit private schools. This cost continues to increase year-on-year, prompting more and more students to seek financial loans.
At the moment, 84% of Gen Z students want President Biden to focus on student loan forgiveness over the coming months. For context, that’s a whole 12% more than the number of students who want the President to prioritize the COVID-19 pandemic.
We’ve also learnt that 85% of students are feeling stressed, 71% worried, and 52% helpless about paying back their student debt.
Clearly, the student debt crisis is a top concern among students, more so than the pandemic even. But with both of these issues existing simultaneously, Gen Z students are faced with a dual crisis. They need support now more than ever.
Student income and the Labor Movement
69% of college students have had a job in the past year. For both college and high school students, food service is the most popular industry to seek part-time work in, followed by retail for college students.
As a result of the pandemic, more students are relying on part-time work to keep their finances afloat, and make up for lost time elsewhere. Indeed, internships have been canceled for some, travel plans put on halt for others, and the job hunt heavily disrupted for graduating classes.
Julia, a Marketing major at Temple, told the New York Times of students who had lost internships during the pandemic and had secured jobs at supermarkets or elsewhere to account for lost opportunities. As life opens up again, more jobs are becoming available, “but it’s tough to put an internship that got canceled on your résumé” she said.
The cost of college is not nearly relative to money students make from part-time work. Plus, with tuition fees mounting and career-boosting experiences being lost – as well as the college experience in general – many students are understandably feeling let down. Indeed, the Labor Movement has been making headlines of late, calling out takeout venues and other brand sectors for unrealistic low wages and poor working conditions – an issue that’s impacting students facing enormous sums of debt as they move through their college years and beyond.
The value of student incentives
It certainly can be tough out there for college students, but it doesn’t have to be. As a brand, you have a responsibility to support your next consumers, especially students who are in the midst of deciding their brand loyalties. To make that lasting impression, it’s important to really understand your audience – and this includes their financial concerns.
Student loyalty programs will help boost brand loyalty. We’ve learnt that if a brand is promoting a student discount, 92% of students would think the brand cares about students, and 90% would think the brand is relevant to young people – which means you are far more likely to entice a new cohort of consumers. 94% of students also said affordable prices would make them stay loyal to a brand, as well as quality products (96% of students said this).
With over 15 years of student marketing experience, Student Beans knows students better than anyone. We are constantly keeping our finger on the pulse with our bank of Gen Z learnings and insights. We verify students in real-time to keep your profit margins secure, and we reduce basket abandonment by being a brand Gen Z students trust.
We might not have the power to abolish the student debt crisis, but we do have the power to help the next generation of consumers thrive, together. After all, winning Gen Z students’ loyalty now means you win loyalty for a lifetime.
Get to know your next generation of consumers today – and help fuel the change they’re looking for – with our Ultimate Guide to Generation Z.
