Gen Z are a driving force in the current retail evolution climate

19th June 2019 17:13

Written by Gill Redfern, Research Director. Contact Gill here

It feels like we’ve barely got to grips with what Millennials are all about (the more expressive and open-minded generation who are receptive to new ideas and ways of living versus the previous Gen X), and now the focus has switched to the younger, more digitally savvy and experientially driven Generation Z!

So, who are they? How do they differ from Millennials and their older counterparts? And what do retailers need to know about their younger customer base?

DJS Research surveyed 1000 UK Nat Rep consumers, 9% of whom were at the older end of the Gen Z age spectrum (aged 17 – 23 years).  What emerges from our insight is a generation who are quite markedly different than their parents and even their Millennial neighbours in terms of where they draw their influences and ideas, how they shop, and what they expect from their retailers of choice.

Choosing a retailer ...

When it comes to deciding which retailers to visit, Gen Z are more likely to be influenced by social media recommendations than the total population (37% vs. 16%) and celebrity endorsement influences approx. one in ten Gen Z consumers (13%), compared to just 4% of the general population. Gen Z consumers may have their own ideas, but they’re not afraid to soak up inspiration and recommendations from other sources before making their retail choices.

 

It won’t come as a huge surprise that Gen Z consumers are significantly less likely to mostly use bricks and mortar retailers vs. the general population in 2019. Of the respondents polled, just 15% of Gen Z are likley to only use high street retailers, compared to a third of the rest of the population. They are also more likely to only use online retailers with a third (33%) saying this was their preferred way to shop, compared to a quarter (25%) of the rest of the population.

Gen Z have been born into a world of technology, where swiping a screen is as natural as hitting up Google or Face Timing their mates. They don’t have the same shopping habits as their older counterparts, and their sense of community is online driven, rather than on the high street. Moreover, they don’t have the same concerns around online security as previous generations who tentatively embarked on online purchases for the first time as mature adults.

Once they have placed their (non-grocery) orders online, Gen Z consumers look for immediacy when it comes to deliveries, they live in the moment and only same day (22%) or next day (56%) deliveries will do, compared to just 10% of the general population opting for same day or 30% choosing next day.

Gen Z live in a fast-paced world and they are not willing to compromise!  They entered the world after dial up internet and the ZX Spectrum were long gone, so their reference points are much more likely to be Superfast 70MB fibre broadband and PlayStation 4! Their world moves fast, but they are more than adept at keeping pace … so they expect their retailers to as well.

“When it doesn’t get there that fast they think something’s wrong,” said Marcie Merriman, executive director of growth strategy at professional services firm, Ernst & Young. “They expect businesses, brands and retailers to be loyal to them. If they don’t feel appreciated, they’re going to move on. It’s not about them being loyal to the business.”

While their awareness of new technologies in retail isn’t significantly higher than the general population, they are often more open to innovation in the sector, which fits with their general desire for a more experiential retail journey where they are in the driving seat. In particular, Self-service kiosks (85%), Auto-stock email alerts (84%), Visual search (73%), Smart Screens instore (73%) and Smartphone wallet apps (63%) appeal, with Smartphone apps and Self-serve kiosks significantly more appealing to Gen Z than the general population.

 

As has been recently demonstrated by Greta Thunberg and her Gen Z climate change activist peers, this generation have a strong ethical compass and our data specifically reveals they are more likely to check the ethical and corporate social responsibility policies of retailers before shopping with them (43% vs. 28% of the general population).

In addition, they are more likely to ‘completely agree’ that they have consciously reduced how frequently they buy clothing due to the impact of the fashion trade on the environment vs. the general population (23% of Gen Z completely agree vs. 11% of Nat Rep population).

And so, could it be that this retail-savvy demographic with a thirst for innovation and penchant for convenience could also be instrumental in paving the way for a more sustainable, ethically-conscious alternative to the fast-fashion juggernaut? With increasing numbers of Instagram influencers and celebrities showing their support for planet-friendly lifestyles, clothing and products online, and the wider debate around sustainability playing out in the media, conditions could be ripe for change. And if retailers take note, Gen Z could be front of the queue…

To find out more, or to conduct your own research within the retail sector get in touch with one of our retail specialists: Gill RedfernRebecca Harris or Sharon Nichols

 

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