The young age group is attracted to self-expression and individuality, but still cares about a purchase decision mainstay: price.
Gen Z loves individuality. In fact, the one thing they might agree on is that they are all different and have niche interests that set them apart from each other, according to a report from Horizon Media in October.
Additionally, 60% of Gen Z agree that the brands they shop with are an expression of who they are and 77% don’t want to feel like they’re put in a box, according to 2020 survey data from Wunderman Thompson Intelligence shared with Retail Dive.
That sets up a conundrum for retailers hoping to reach them where they are, since “where they are” might be completely different depending on which Zoomer you speak with. The age group — defined by Pew Research Center as those born between 1997 and 2012 — has the industry in a chokehold, upending what traditional brands know about marketing and merchandising.
Retailers certainly care about what this generation wants. As this group gets older, their buying power gets bigger within the industry and so does their influence on how well brands perform.
Teens’ self-reported spending increased slightly by 3% year over year to $2,331 according to research firm Piper Sandler’s fall 2022 Taking Stock With Teens Survey of 14,500 U.S. teens. Female teens led that spending increase too, with that group’s overall spend up 10% year over year and clothing being 30% of their wallet share — the highest it’s been since 2012.
Despite that, Gen Z is not immune to the throes of macroeconomic pressure. Inflation seems to be putting a dent in the group’s ability to save, according to Bank of America data from September that surveyed those ages 18 to 25. It found that 73% of Gen Z say it’s hard to save money right now, and 56% say inflation has created more financial stress in their lives.
With Gen Z’s spending power increasing and budgets potentially tightening, retailers might be wondering how they can earn the demographic’s loyalty. Taking a look at the brands Gen Z currently favors might shine a light on what actually motivates their purchase decisions.
Despite loyalty looking different for this generation, many of their favorite brands are familiar faces (with a few exceptions).
Amazon, Walmart, Target, Dollar Tree and Nike were all ranked among the top 15 favorite brands by Gen Z, according to a survey conducted by research firm Morning Consult of about 2,031 Gen Z adults born between 1997 and 2004.
When compared to the favorite brands of millennials, though, several companies were much more favorable among Gen Z. These included Crocs, Fenty Beauty by Rihanna, Shein and E.l.f cosmetics.
Shein was a high-ranking apparel brand for Gen Z women according to Morning Consult’s data, and a similar pattern of results was found from Piper Sandler.
Courtesy Retail Dive. By Dani James. Article available here.