[{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/www.the-future-of-commerce.com\/2022\/11\/14\/gen-z-purchasing-power\/#BlogPosting","mainEntityOfPage":"https:\/\/www.the-future-of-commerce.com\/2022\/11\/14\/gen-z-purchasing-power\/","headline":"Retail reality: The truth about Gen Z purchasing power","name":"Retail reality: The truth about Gen Z purchasing power","description":"Marketers eagerly anticipate the next generation, but we've been overestimating Gen Z purchasing power. Here's what brands need to know.","datePublished":"2022-11-14","dateModified":"2024-02-15","author":{"@type":"Person","@id":"https:\/\/www.the-future-of-commerce.com\/contributor\/jasmine-glasheen\/#Person","name":"Jasmine Glasheen","url":"https:\/\/www.the-future-of-commerce.com\/contributor\/jasmine-glasheen\/","identifier":687,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/bbe990b08118cf49388e37c8fc87059575ef7ffece229306aa1596dff908b1c2?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/bbe990b08118cf49388e37c8fc87059575ef7ffece229306aa1596dff908b1c2?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"The Future of Commerce","logo":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2023\/01\/logo-foc-schema-app-1.png","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2023\/01\/logo-foc-schema-app-1.png","width":172,"height":60}},"image":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2022\/11\/Gen-Z-Purchasing_HALF.jpg","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2022\/11\/Gen-Z-Purchasing_HALF.jpg","height":278,"width":707},"url":"https:\/\/www.the-future-of-commerce.com\/2022\/11\/14\/gen-z-purchasing-power\/","about":["B2C Commerce",{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/commerce\/","name":"Commerce","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Commerce","http:\/\/www.wikidata.org\/entity\/Q26643"]},{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/marketing\/customer-engagement-marketing\/","name":"Customer Engagement","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Customer_engagement","http:\/\/www.wikidata.org\/entity\/Q5196451"]},{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/marketing\/marketing-general\/","name":"Marketing","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Marketing","http:\/\/www.wikidata.org\/entity\/Q39809"]},"Retail Trends, Data, News",{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/commerce\/sustainability\/","name":"Sustainability","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Sustainability","http:\/\/www.wikidata.org\/entity\/Q219416"]},{"@type":"Thing","@id":"https:\/\/www.the-future-of-commerce.com\/uncategorized\/","name":"Uncategorized","sameAs":["https:\/\/en.wikipedia.org\/wiki\/Categorization","http:\/\/www.wikidata.org\/entity\/Q5884621"]}],"wordCount":739,"keywords":["Consumer Behavior","Generation Z","Retail Trends","Sustainable Retail"],"articleBody":"Marketers talk all the time about Gen Z purchasing power. Gen Z\u2019s age currently ranges from 10 to 25 years old. Just as they were with Millennials and Gen X, brands are obsessed with Gen Z\u2019s shopping behavior as they come of age.Their influence on household purchasing decisions, the trends they favor, and how they\u2019re leading their cohorts to be more discerning have been hot topics\u00a0 since the first members of this generation hit their teens. But all that glitters isn\u2019t gold.Let\u2019s take a look at the myths surrounding Gen Z purchasing power, the factors impacting their ability to spend, and how retailers can use this information for effective engagement.      Gen Z and Generation Alpha rising: How brands can win customers for life                Gen Z is the current powerhouse in the retail space, but brands are already sizing up the next generation of shoppers. With Gen Alpha, it's a chance to start early and win customers for life.      Gen Z purchasing power: By the numbers\u00a0As marketers eagerly anticipate Gen Z, we\u2019ve been overestimating their purchasing power as an independent demographic. But Gen Z has faced obstacles the likes of which their predecessors couldn\u2019t even imagine.After more than two years of lockdowns due to a global pandemic, they’re grappling with an inflation rate that\u2019s reached historic, 40-year highs. They’re paying huge sums for housing and gas while trying to pay off their student loans.While one study found that they steer the lion\u2019s share of family household purchasing decisions, those who live alone have far less purchasing power than their predecessors.Some sobering stats:Gen Z actually has 86% less purchasing power than baby boomers did when they were in their 20sGen Zers have more student debt than millennialsA Deloitte survey found that almost half are living paycheck to paycheck and 30% don’t feel financially secureWe need to start looking at the realities of marketing to Gen Z \u2013\u2013 they\u2019re a financially strapped and stressed demographic that want to see real value in any products they consider purchasing.Where the real purchasing power liesMillennials are actually the largest customer group, while Baby Boomers have the most spending power.But rather than trying to assess the worthiness of marketing to a specific age demographic based on the size of their disposable income, retailers\u2019 should look at what demographics align with their existing offerings.It\u2019s a lot easier to expand inventory or marketing campaigns to target groups with similar priorities once you’ve already homed in on a core customer base. Once the core customer is understood, it\u2019s easier to find copycat shopping priorities that drive customers towards the brand base.A demographic\u2019s attributes, purchasing history and behavior can tell us a lot more about how to market to them with the right message than creating campaigns based on generation alone.      Digital natives: How to win the trust of Gen Z and Millennials                73\u00a0percent of digital natives are involved in B2B product or purchase decision-making, and about\u00a0one-third\u00a0are sole decision-makers. Learn how to win their trust.      A multi-faceted approach for multiple generationsSeeing where customer sub groups correlate can help retailers create sourcing strategies and marketing campaigns specific to those they serve. It\u2019s about going further than targeting the youngest generation due to faulty assumptions.Instead, retailers need to target sub groups based on shared behavior. Here are two examples:Both Gen Z and Boomers look for comfort first when shopping for apparel. So a company that specializes in say, Croc look-alikes would want to source styles and colors that appeal to both age ranges.Millennials and Gen Z share a preference for sustainable brands. But there are some nuances. Millennials tend to look for sustainability in brand ethos\/messaging, Gen Zers want to know the details of retailers\u2019 supply chains. To appeal to both millennials and Gen Z, a retailer could highlight their sustainability efforts with a customized focus for each priority to optimize their message.Gen Z doesn\u2019t lead in terms of spending power, but that doesn\u2019t mean it\u2019s safe to discount this frugal powerhouse of a generation. Savvy retailers will learn to broaden their appeal by customizing their messaging across generations.  Tariffs. Supply chains.Customer expectations. C-suite expectations. Everything you need for retail success, none of the fluff.Download the market analysis\u00a0HERE."},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"2022","item":"https:\/\/www.the-future-of-commerce.com\/2022\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"11","item":"https:\/\/www.the-future-of-commerce.com\/2022\/\/11\/#breadcrumbitem"},{"@type":"ListItem","position":3,"name":"14","item":"https:\/\/www.the-future-of-commerce.com\/2022\/\/11\/\/14\/#breadcrumbitem"},{"@type":"ListItem","position":4,"name":"Retail reality: The truth about Gen Z purchasing power","item":"https:\/\/www.the-future-of-commerce.com\/2022\/11\/14\/gen-z-purchasing-power\/#breadcrumbitem"}]}]