By Rieva Lesonsky
Members of Generation Z (sometimes called Zoomers) are coming of age. The leading edge of the generation is entering the workforce and ready to spend money. But before you can sell to them, you need to know what Gen Z cares about and how they shop.
Insider Intelligence recently talked to Zoomers to find out what motivates them to spend.
How to sell to Gen Z: Find out what motivates them to buy
Sustainability on a budget
For years we’ve been told that Gen Z is “one of the most sustainability-minded generations.” But most Zoomers are still teens or in their early twenties. And while they care about the environment, they’re on a budget and are “choosy” about how they spend their money.
Insider Intelligence says this mindset is one of the reasons secondhand retail has become so popular, giving Zoomers the ability to buy the brands they like while also being environmentally conscious by keeping an item from being thrown away.
Brand awareness
Consumers, particularly Gen Z, are more aware of the actions and views of corporate brands because they keep tabs on them using social media. This can be beneficial for companies, especially small businesses, that are able to show the human side of their company, which makes them more relatable. Insider Intelligence says, “Being on social media adds a human element, making [your business] about the people more than the products.”
However, it can also expose views and actions that Zoomers don’t agree with that can quickly turn them off your brand and in search of a company that more closely matches their values.
Whom do they trust?
TikTok is extraordinarily popular with Gen Z—it is indeed their “platform of choice to discover new products, especially in the beauty category.” One Zoomer told Insider Intelligence that TikTok gives them more current content and exposes them to more new products or ones that have gone viral than YouTube does.
But like most consumers of all ages, Zoomers say recommendations from friends and family influence them the most when making a purchase.
They’re less loyal
Since Gen Zers are “uber-conscious about how much they consume,” they’re less loyal than older generations. One Zoomer said she “veers away from loyalty programs that make you try to buy more.” Instead, she chooses loyalty programs that focus on sustainability or offer discounts.
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They’re not shopping in the metaverse
While there’s been a lot of buzz about the metaverse, Zoomers aren’t shopping there—yet. Some believe the metaverse will “evolve” into something they may use one day. But Insider Intelligence says to keep an eye on the next generation (Generation Alpha), who may be more eager to shop in the digital universe.
Another survey, Square and Afterpay’s State of Retail Report, shows that younger consumers (Zoomers and millennials) are increasingly shopping via mobile commerce. It reports, “In the past year, two-thirds of Afterpay online transactions from millennials and Gen Zers were made on mobile devices, with the volume of Afterpay transactions up 196% since 2020.”
These younger consumers are also using their mobile devices “as their primary customer support tool.”
“Buy now, pay later” has arrived
The retail report also shows that while Zoomers and millennials are the primary users of “buy now, pay later” (BNPL) services today, Gen Xers and baby boomers are increasingly using BNPL options.
One reason Zoomers embrace BNPL is that they’re buying more luxury items, which obviously cost more money. Gen Z’s share of luxury item spending is now 16%, up from 13% in 2019, while millennials’ luxury spend has decreased from 56% to 45% from 2019 to 2023. This is fueled, in part, by the post-pandemic return to the office. Square reports a year-over-year increase in sales of work clothes like dress shirts, oversized blazers, and dress sneakers.
Conscious consumerism
The retail report also covers sustainability and says that so far this year, millennials and Zoomers have a 69% share of spend on eco-friendly products. It suggests businesses “establish partnerships with sustainable brands by collaborating on give-back programs, marketing campaigns, and stocking their products.”
Insider Intelligence advises business owners that to attract Zoomers and millennials, they “need to be intentional about running their businesses in an environmentally conscious way without being seen as performative.”
About the Author
Rieva Lesonsky is CEO of GrowBiz Media and SmallBusinessCurrents.com and has been covering small businesses and entrepreneurship for over 30 years. Get more insights about business trends by signing up for her free Currents newsletter.
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