Retail & Distribution

Gen Z: an emerging consumer generation

6 March 2023

3 min
As an older member of the Gen Z population, I thought I knew everything there was to know about Gen Z. That was until I attended NRF earlier this year. It was fascinating to hear from different retailers about how they are adapting their brand, product and messaging to appeal to a generation of young people with growing financial independence.
In this blog, I’ll outline some Gen Z consumer trends, as well as tips on engaging with this emerging generation as a consumer.

First things first – let’s set some parameters. Although classifying this generation is deeply disputed, in a nutshell, people belonging to Generation Z were born in a span of years between 1997 and 2010, meaning they fall in ages between 11 and 24.

Gen Z consumer characteristics reflect their pragmatic and risk-averse approach to spending money. Their strong belief in social causes is another key influence; they place a very high importance on brand ethics and corporate responsibility, even more so than Millennials.

These beliefs can be reflected in these statistics concerning their shopping and general lifestyle habits:

  • 77% have taken some form of action for a cause they believe in.
  • 23% have boycotted a brand.
  • 30% have made purchase decisions based on brands’ social and political beliefs.

Products and brands need to show an eclectic mix of quality experiences, ethical sustainability and authenticity to tap into the Gen Z wallet.

1. Quality experiences in the physical store

Where Gen Z shoppers spend their money has changed since the pandemic. Two years ago, these consumers split their time and money between bricks-and-mortar stores and online sites. However, since then, Gen Z, the first truly digitally native generation, and the one most comfortable with digital and mobile technology, helped lead the return to physical stores. Part of this may have been rebelling against online retail giants amassing too much influence. It could also have been a nostalgic draw to shopping live with friends in actual stores.

In fact, a CM Group study found they have a higher preference than millennials for in-store shopping in multiple categories, including electronic devices and clothing. Other research has shown Gen Z consumers will ditch online shopping if retailers offer exceptional in-store experiences to draw them away.

The Gen Z desire for in-person shopping experiences is strong, but the bar for these experiences high. Retailers need to step up with unique experiences that this new generation will value.

2. Brand Sustainability

Generation Z care deeply about the planet. In fact, three-quarters of them view sustainability as more important than brand names when making purchases. Stocking environmentally friendly products will appeal to this generation, but only if it’s done with true commitment – being sustainable for the sake of it will be spotted and criticized by this generation… see below!

In fact, in an ever-growing journey to sustainable fashion, according to an AdWeek-sponsored study on Gen Z consumer behavior, 50% of respondents said they plan to make their own clothing in 2023, while more than a quarter plan to turn to thrifting.

Read more about how retailers are championing sustainability in their businesses.

3. Being authentic and, more importantly, avoiding hypocrisy

To Gen Z, what really matters is avoiding hypocrisy. In the age of the internet, insincerity is easily exposed online.

In order to build trust with this generation of consumers (and all consumers as we see sustainability becoming a top priority for more shoppers), brands should avoid greenwashing. To do this, brands may consider:

  • Relying on trustable systems for data before implementing green promotions.
  • Making sure third-party certifications are credible
  • Standardising definitions, for example, for terms such as ‘eco-conscious’ and carbon neutral
  • Implementing sustainability as an integral part of businesses

For example, last year, Boohoo (a fast-fashion site) faced masses of backlash when they appointed Kourtney Kardashian (a private-jet owning socialite) as a ‘sustainability ambassador’. This is testament to avoid cliches and to only commit to causes you can honestly and tangibly support.

It was clear from NRF that retailers need to adjust their strategy when addressing the Gen Z population. Being financially pragmatic and ethically driven spenders means retail businesses need to show a commitment to ethical sustainability and authenticity to draw Gen Z to their stores. And speaking of stores, targeting this generation with unique in-store experiences may be the best way to drive footfall in a post-pandemic world.

So, you’ve mastered speaking to Gen Z as a consumer, but what about as a member of your team? Look out for more about targeting and nurturing Gen Z in your workforce next week.

Looking for ways to see how Cegid Retail Store Excellence can assist in your retail operations? Click here to see what our platform could do to improve your retail employee experience. If you have any questions or need help with any areas of your Retail Operations tech choices, please get in touch  with the Cegid Retail Store Excellence team.