The Spending Habits of Generation Z Marketers Should Know

Marketing professionals who hope to remain relevant and capitalize on this nascent market must understand Gen Z's consumer behavior and spending habits.

With $143 billion in purchasing power, up from $44 billion in 2017, Gen Z (also known as "zoomers") accounts for 40% of global consumer shopping, compared to $44 billion in 2017. A large portion of Gen Z hasn't yet reached their prime working years, which Morgan Stanley predicts will start in 2022 and continue until the late 2030s. 93% of parents say their Gen Z children influence their purchasing decisions, so that doesn't mean younger members of Gen Z don't have influence, either.

We've gathered a few of the most important statistics on Gen Z's spending habits to help you connect with this audience. Gen Z already has a huge impact on the global economy and is set to continue growing as more people start working.

Consumer behavior among Gen Z and Millennials differs

It is important to understand how Gen Z consumers differ from Millennials before diving into their buying habits. In spite of the temptation to lump Gen Z and Millennials together, these generations have their own consumer behaviors, which are influenced by their cultural and technological environments. A world inexorably connected to the internet was born to Gen Z, unlike Millennials who grew up with access to the internet.

A key characteristic of Gen Z, for example, is that they spend much more time online than other generations, including Millennials. According to a study published by Adobe, the average Gen Zer spends 10.6 hours online each day, compared to 8.5 hours for Millennials. In order to communicate effectively with Gen Z, marketers must cater to their unique preferences online.

Marketers should be aware that Gen Z has unique spending habits compared to Millennials, though they aren't that far apart age-wise. As well as spending more time online, Gen Z also distrusts brands less. In fact, a Salesforce study found that 50% of Millennials trust companies compared to only 42% of Gen Z'ers. Brands that want to engage with Gen Z need to go the extra mile.

Having learned more about Gen Z consumer behavior and how it differs from Millennial habits, here are some notable statistics and insights to help you create an effective marketing campaign for this generation:

1. Smart devices are used by Gen Z for on-the-spot research

While shopping at brick-and-mortar locations, 47% of Gen Z consumers research items using mobile devices

The majority of Gen Z users access the web through their smartphones, according to Snapchat's research. 97% own a smartphone (globally), and 78% consider their mobile device to be their most important tool for connecting to the internet. In addition, smartphone ownership has continued to decrease, with most children owning one by the age of 10, compared to 12 in 2012. Some children receive their first smartphone as early as age seven.

Almost 63% of Gen Zers say they cannot live without their smartphones, and data suggests that most of them check their phones every three minutes. It is practically impossible for Gen Z’ers to shop without these devices, which has a drastic impact on their shopping habits at an early age.

Smartphones and tablets are used by Gen Z to research both before and during visits to brick-and-mortar stores. What do they research? In addition to checking online for items they prefer not to find in the store where they are, 52% compare retail prices with competitors, and 51% look for coupons, discounts, or promotions, 53% of Gen Z use their smartphones to check the web for other items.

In order to meet the needs of Gen Z consumers, marketers need to offer detailed information about products and services through both digital and physical channels. In order to satisfy Gen Z, brands must provide information across multiple channels, which vary by individual, depending on which ones they use most. The information also needs to be consistent, since Gen Z may conduct research in-store or online using multiple channels.

You can guide Gen Z's shopping habits, cultivate trust, and encourage them to gravitate to your blog, service, or product by establishing your website as an authority.

2. Speed and customer service are important to Gen Z

Gen Z'ers are more likely than average consumers to hang up if their call isn't answered within 45 seconds

Due to their exposure to the internet, Gen Z expects customer service to be fast and agile. This is especially true on social media. With Gen Z's growing buying power, individualized, timely customer service will become more important as consumers increasingly use social media instead of phone calls to address their customer service needs.

As consumers hop between channels, brands need to find a way to seamlessly connect interactions, as Gen Z values fast, fluid customer service responses more than other groups. A Gen Z customer can, for example, receive an update on the situation through Twitter after raising an issue on Facebook.

77% of brands said that creating a cohesive journey across channels and devices is a pain point. Since 62% of consumers prefer to engage with brands across multiple digital channels, and 77% expect brands' internal teams to communicate so they don't have to repeat themselves, this is especially troubling.

Gen Z consumers rely heavily on online research to find answers to their issues, which ties into the previous point. In order to build trust with your Gen Z consumer base and curry their purchasing power, you should provide a variety of options for answering customer care questions.

3. The Gen Z generation prefers collaborative, interactive environments

In a study, 42% of Gen Z respondents said they would play an online game for a campaign; 43% would write a product review

Marketing professionals should take note of these two numbers: Gen Z is looking to engage with brands and invests their own energy and time into building their reputations.

In order to connect with Gen Z, social media is the perfect platform for creative campaigns that encourage collaborative engagement. Consumers should use this as an opportunity to contribute to something bigger than themselves by creating personalized, interactive experiences. Twitch and YouTube Gaming, which will receive 17 billion hours of watch time in 2020 and 10 billion hours in 2020 — both significant increases from 2019 — are two of the reasons Gen Z is so captivated by these services. In addition to interacting with their favorite streamers, Gen Z can join a community, play interactive games, and chat with them.

The streaming industry has grown to be extremely lucrative for content creators and gamers. A streamer who plays around 40 hours a week on average can make between $3,000 and $5,000 a month, according to Business of Apps. This number doesn't include ad revenue, which averages $250 for every 100 subscribers. It is generated by streamers' influence in society, which is the source of revenue. According to a column written by NFL star JuJu Smith-Schuster in 2019, streamer "Ninja" was named to Time magazine's list of most influential people in 2019.

Millennials spend a lot of time and money on interactive channels like Twitch and YouTube Gaming, making them an important battleground for marketers.

4. The Gen Z generation expects great user experiences

More than 60% of Gen Z shoppers won't use apps or websites that load slowly or are difficult to use

The Gen Z demographic places a high value on efficiency. According to a survey, nearly half of Gen Zs think finding things quickly is the most important aspect of shopping. Furthermore, 65% of customers said they've switched to a different brand after experiencing poor service.

Basic requirements for retailers include making sure their online assets run smoothly and providing a layout and functionality that caters to Gen Z's consumer behavior.

The user experience should extend beyond brand websites and apps — every digital channel should provide a great user experience. It should be easy to use, provide enough information, and load quickly. It is already a familiar interface for Gen Z that brands can leverage to engage with this audience and provide customer service.

While Gen Z may spend 10.6 hours online every day, they don't want to wait that long for brands to resolve their issues via social media. Brands that utilize social media for customer care need to emphasize a fast, personalized response. Brands can better connect with Gen Z consumers by offering a personalized user experience along with a fast and intuitive website.

5. Celebrity is less important to Gen Z than authenticity

Influencers are trusted by 52% of Gen Z, but celebrities and athletes are trusted by 44%

According to a study of 2,000 people aged 13-38, Generation Z trusts influencers more than celebrities for product and brand recommendations, which suggests they prefer authenticity since they are more relatable than celebrities. A similar study also found that when Gen Z and Millennials were deciding whether to follow a figure on social media, authenticity and a genuine concern for their interests were the most important factors.

Brands targeting Gen Z can use influencers effectively as spokespeople, but they must speak from an authentic perspective aligned with the brand's values. A celebrity or influencer who acts as a spokesperson for a product or service that they do not use or believe in can have difficulty hiding the fact that it can spread quickly and be nearly impossible to conceal.

Whenever possible, brands should use user-generated content, such as images and videos from actual customers, because Gen Z is more likely to trust brands if they use images from real customers.

Eighty-eight percent of Gen Z and Millenials learn about products they're interested in through social media and five-sixths have purchased a product after seeing a post from someone they follow.

Gen Z's trust can be severely damaged by dishonest marketing campaigns that can be unraveled with research or a quick screenshot. Being honest with your Gen Z audience is easier and safer. In the coming years, Gen Z's spending power will pay dividends as it builds trust.

What can marketers do to connect with Gen Z consumers?

Gen Z has an even shorter attention span of 8 seconds than millennials, according to a statistic you may have heard by now. According to READY Education, Gen Z isn't an attention-deficient generation, but rather one that has an eight-second filter. Brands have no time to waste capturing Gen Z's attention, and once they do, they need to be responsive and engaging to keep it.

Gen Z expects an engaging user experience. Got questions? Visit us @ and we’re happy to help.

Thursday, December 8, 2022
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