Report: Generation Z Will Have Greatest Impact on Future Retail
Apparel brands may not only be on the hunt for Millennials.
According to a recent Retail Perceptions report, Generation Z will determine retail’s future state. This demographic, born after 1995, currently makes up one-fourth of the U.S. population and more than 70 percent of parents said their Gen Z kids influence apparel buying decisions in their households. This aligns with the fact that this select group already possesses $44 billion in spending power.
The report, titled “The Next Generation of Retail Z,” analyzes teens’ shopping preferences, in-store versus online and social media’s role on this age demographics’ retail involvement.
Generation Z is pretty thrifty and favors experiences over material objects. Eighty-nine percent of them consider themselves to be price-conscious shoppers, while 62 percent prefer to spend money on experiences rather than accessories, clothing and electronics. Despite both statistics, a majority of teens’ spending goes to clothing (67 percent). Perhaps it may be due to the fact that 55 percent of Generation Z individuals receive allowances from parents and 52 percent reported having part-time jobs.
When it comes to shopping in-store or online, 64 percent of Generation Z respondents said they would rather shop in a store over buying on e-commerce platforms. Seventy-two percent also said they prefer shopping at retailers that provide engaging in-store experiences.
Although the statistics were close for buying apparel (42 percent online) and (58 percent in-store), 80 percent of Generation Z respondents said they browse in stores when they are uncertain about purchases.
Social media also makes or breaks Generation Z’s retail decisions. Facebook was the most popular platform for product research, shopping inspiration, retailer interactions and product reviews.
Sixty-three percent of respondents said they expect retailers to be on social media and 60 percent also said they favor retailers that connect with them on social media over those that don’t.
On the side of retailer social media accounts, Generation Z individuals desire brands to share information about new products (78 percent) and discounts (62 percent). Most of these young shoppers said they will share a retailer’s product quality reviews (65 percent) and positive customer service experiences (46 percent).
As today’s market becomes more competitive, it will be important for retailers to address Generation Z demands and also tailor their business strategies toward America’s most populated shopper demographic.