Retailers aiming to capture a younger audience must understand four major characteristics of the Gen Z shopper: they are very price-conscious, they prefer experiences over material items, they’re not brand loyal and they prefer paying with cash to credit and debit cards.
With Gen Z currently making up 25% of the total U.S. population and representing $44 billion in buying power, brands need to move quickly in order to align their business models to this demographic.
As many as 89% of Gen Z shoppers consider themselves price conscious, according to a study from Interactions Marketing, titled: Next Generation of Retail. They also prefer to spend their money on experiences instead of material items (62%), with two of the top three spending areas being experiential:
Clothing (67%); and
Experiences with friends (47%).
When making a purchase, 64% of Gen Z prefers to use cash as their method of payment vs. credit and debit cards.
Interactions Marketing generated the data from a survey of more than 2,000 Gen Z’ers in the U.S. between the ages of 14 and 19. The study analyzed the shopping habits and preferences of these shoppers so that retailers can engage and interact with them more effectively.
81% Would Switch Brands For Quality
The study dives into the reasons Gen Z shoppers make their purchases. A majority of these consumers don’t display a strong sense of brand loyalty, with 81% willing to switch from their favorite brand if they find a similar product at a higher quality. Similarly, 79% don’t care if a product is from a national or private brand as long as it’s of good quality.
Although brand loyalty may not be a chief concern when comparing multiple items, the brand still matters to consumers mulling over a purchase. The top five factors Gen Z shoppers identify when making a purchase include:
3. Brand name
4. Social responsibility of brand/retailer; and
5. Environmentally friendly product