Here’s a thought. Children today are your adult consumers of tomorrow.

For this reason, savvy retailers are investing in ways to accommodate and engage with young people responsibly, nurturing them for the future. It’s a worthwhile pursuit for those brands operating in the ecommerce space, bearing in mind that of the 12 to 15 age segments, 83% own a smartphone and 50% have their own tablet.

Virtually all – 99% – go online for 20.5 hours a week, according to a recent Ofcom report. And with social selling on the meteoric rise, the most likely way for young people to explore the world of shopping as they grow up, will be through their phone.

The big challenge is engaging these young people responsibly.

Make friends with Gen Z and Gen Alpha

Young consumers are fully committed to browsing online and engaging with brands that represent something new, pertinent and exciting. One could argue, befriending them early makes solid business sense. With Gen Z known to be digitally obsessed and Gen Alpha (those born after 2010) expected to be even more so, tailoring to their needs and facilitating an ongoing digital relationship is an astute customer acquisition strategy for the relevant players.

The likes of Lego, Disney and H&M are highly skilled at engaging younger consumers in ways that complement their brand – using rich content, online games and social campaigns to attract and entertain youngsters responsibly. Even brands that serve older demographic groups have ‘next gen’ shoppers firmly in their sights.  John Lewis & Partners acquires customers at “key life stages” says Simon Russell, Director of Operational Development at John Lewis & Partners – such as when they are getting married and want a John Lewis wedding list. “We need to cater to our target customers first and foremost. That said, Gen Z is undoubtedly the future. There will be certain life moments when we recruit younger shoppers, and we do need to really draw them in at those points.”

Parents matter too 

Making connections with young consumers is fraught with danger though. Quite rightly parents still want control over how their children use the internet. And when it comes to kids shopping online unsupervised there are many pitfalls for families and businesses alike. It’s not surprising that Ofcom  has found 41% of parents are ‘very or fairly concerned’ about their children aged 5-15 being ‘pressurised to spend money online’.

There are then issues around children spending recklessly using their parents’ cards, and exposing themselves and their parents to identity theft, online fraud and data protection risks. The main payment method for children in the UK is their parents’ credit card, bank account or online account, such as PayPal. Only 28% of British children have their own bank account, but even here retailers face challenges around contracting with under-18s and additional data protection rules for under-14s.

Data protection risks

As GDPR has bedded in, there is now increasing scrutiny over some of the less well understood elements. Businesses must take care when dealing with children, ensuring they address them in language they can understand and there are additional requirements to protect their data. Failure to do so will result in heavy fines – up to 4% of annual turnover.

But more significantly this is not just an issue of compliance. Protecting children is a broader corporate social responsibility. It goes without saying that any breach – large or small – will create reputational damage and reduce brand equity. Parents will certainly not encourage their children to engage with brands and retailers known to have a poor track record in data compliance, and responsibility towards young consumers.

Are You Exposed?

Those companies that choose to engage with children online – explicitly or implicitly – need to consider offering child-friendly payment options. They will benefit from nurturing next gen customers, building parental trust, as well meeting legal and GDPR compliance requirements.

Treading an ethical path around payment, it’s possible to generate customer satisfaction early – for both parents and children.  This helps retailers build relationships that could potentially last for decades to come.

Payment authentication for parents

Fashion and accessories brand Hype appeals to 12-16 year olds and takes its responsibility to families seriously. The company has added VeeLoop payment technology to its online checkout. This payment authentication plug-in allows young shoppers to purchase products by first sending the authorisation to their parents.

At the Hype checkout, teenagers see an option to forward their baskets to their parents by clicking a simple icon. Parents can then use the online solution to approve the products, editing if necessary, before paying for the purchases and organising delivery. The technology protects data of under-18s while keeping parents informed of their purchases.

“We want people to express themselves through our clothing, and there should be no limits to that. Our customers love this feature,” said Liam Green, co-founder and creative director of Hype. By adding an extra step before the ‘buy’ button, the brand is encouraging independence but ensures young fans are totally safe at the same time.

Taking the responsible route

The traditional customer touchpoint of ‘a good payment experience’ is difficult to recreate for those too young to have their own payment methods. Payment authentication tools like VeeLoop overcome this life-stage barrier in a responsible way, by adding value and convenience to both the child and the parents’ brand experience. It’s an easy way to facilitate parental control while also giving a child freedom to explore and choose on their own.

There should be absolutely no sense of encouraging children to spend. This is about making their consumption safer and more convenient. It’s about creating a better solution for what is already happening.

“Digital technology has already changed the world, and as more and more children go online, it is increasingly changing childhood,” said UNICEF in its Children in a digital world report. It might be a hard truth for some, but children and teenagers will want to go shopping online – and retailers need to embrace this responsibly, or have their knuckles firmly rapped.

By Randa Bennett, founder of VeeLoop