As the first true digital natives, Generation Z (anyone born 1997-2012) has already started making its mark on the world. As people of this generation gain more purchasing power, it’s important to learn more about what they value in products, brands and shopping experiences. This may involve digging a little deeper and dispelling some commonly held myths.
“Gen Z is a generation of contrasts, and many preconceived notions of this young group of consumers may need to be reconsidered,” according to a recent report from the International Council of Shopping Centers (ICSC). “They’re the first group in history to grow up entirely with digital and mobile technology at their fingertips. At the same time, they’ve helped play a leading role in the revival of physical stores, highlighting the draw of gathering, shopping and dining with friends in person.”
Driven By Value
While some might think of young people being driven by consumerism at any cost, Gen Z is actually a highly cost-conscious group. After all, most of them have already lived through the Great Recession of 2008 and the economic instability of the COVID-19 pandemic.
That might be why the ICSC survey found this generation preferring to buy things with debit cards (45%) or cash (21%). Credit cards came in 17%, and mobile payments came in at 14%.
The survey also indicated that Gen Zers prefer shopping at discount/off-price retailers (48%), followed by dollar stores (25%), specialty retailers (24%), fast-fashion retailers (22%), department stores (21%) and thrift/secondhand stores (13%).
Driven By Convenience
Gen Z’s need for convenience is a big part of why this age group shops in stores. The ability to get products immediately was the top reason cited by ICSC survey respondents (30%), followed closely by the ability to see/touch/try products (28%).
That need for convenience sometimes even trumps the need for value. Forty-eight percent of ICSC respondents said they’re willing to pay more to have an online purchase delivered more quickly.
While younger generations highly value environmental responsibility, it turns out that both price and convenience may cause them to not select sustainable or environmentally friendly items for the home, according to the 2023 IHA Market Watch survey. The opportunity there, of course, is to find ways to remove those barriers for them.
Desire for Experience
Experience is also a driving factor for Generation Z, and also a reason why some in this cohort prefer shopping in-person. In the ICSC survey, 8% said they shop in stores because it’s something to do with friends, 8% for the unique aesthetic/experience and 5% to see and engage with people. (Another opportunity for retailers? Enhance in-store experiences for young people.)
Some may say Gen Z’s desire for experience may lead them to spend more money on activities outside the home, rather than buying products. But the 2023 IHA Market Watch survey also found that Gen Z is highly motivated to try new at-home experiences. Those who said they often try to create new experiences at home—such as meals, social gatherings or replicating paid activities from places like a spa or movie theater—were most likely to be 18-24 years old and have an income level of $50,000-$100,000.
Digital Natives
Keep in mind that those in Gen Z are the first digital natives. So retailers and brands need to connect with them where they are, which is on social media. And that’s regardless of where they end up making their final purchases.
“Marketers targeting this cohort should leverage social media platforms, influencers and user-generated content to craft relatable, shareable narratives tailored to individual preferences,” Jake McKenzie, CEO of Intermark Group, recently said in Adweek. “Short-form content, such as videos, GIFs and micro-stories, are particularly effective in capturing Gen Z’s gaze.”
