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INDUSTRY INSIGHTS

  • 12 Feb

Generation Z Shopping and Buying Habits

Generation Z and the Future of Retail

Driven by new technologies and the changing buying behaviours of younger consumers, the retail industry is undergoing a monumental transformation. Most retailers have focussed on the demands of millennials, but the younger Generation Z (born post 1995) have come into spending power, and now represent the future of retail. By 2020, Generation Z will account for 20% of working adults.

We took part in a research project with students at Nottingham Trent University – ‘University of the Year’ in the Times Higher Education Awards 2017 – to find out more about the Gen Z buying habits in retail.

Retailers must face the reality that there is a significant sales uplift when consumers are offered an omnichannel experience: where they can start shopping in one channel, browse in another, and complete the journey in either, with their basket history and previous purchases remembered.

One survey found that 69% of customers who entered a store to pick up an item they ordered online bought additional products. Younger consumers also want more transparency where inventory is concerned, so they know if a product is available, and if not, where else they can get it. This gives rise to the first trend identified: convenience.

Generation Z and convenience

It came as no surprise that the focus group preferred brands like Asos, that sell multiple brands in one place, with a powerful search function that finds exactly what Gen Z are looking for.

Not only does this a) negate the need to physically walk around different shops to browse products from different brands but b) negates the need to do the same virtually. This example is a clear feature of Gen Z shopping and buying habits: convenience is king.

product information management system

Generation Z like to shop, but the experience needs to be centred completely around them. We still have a way to go in the “final mile” in retail: delivery. However, Gen Z do not expect a product to be delivered to their home, nor to a store – not to an exact address, but to themselves as the location, wherever that may be.

Although delivery speeds have increased in recent years, location-based delivery should invite similar attention if Gen Z’s demands are to be fulfilled.

Generation Z and experience

“We grew up with technology; we’ll try anything”.  

Generation Z multitask across 5 screens on average, and spend a staggering 10.6 hours a day consuming digital content.

As digital natives, Gen Z are natural information-seekers. They know how to locate the information that they’re looking for – so if they can’t find it, that’s a big turn off. This means that ecommerce must be easily searchable to ensure that the most relevant products are displayed. Visual search technology was an innovation made for Gen Z.

If a Gen Z consumer is struck with inspiration – a celebrity outfit, a product on screen, or on another real-life person – they want to be able to shop it, now. Visual search enables their shopping journey to be completed faster than ever.

About the Generation Z 2018 Research

Retail Assist carried out Generation Z research at Nottingham Trent University’s annual Thinkubator Challenge.

The Thinkubator Challenge, now in its fifth year, sees undergraduate students split into ‘thinking hubs’ to focus on solving business challenges. Retail Assist’s cohort of Gen Z consumers were challenged to present the Future of Retail as they would want to experience it.

Thinkubator is the only event of its kind in Europe and since its launch in 2013, students have addressed nearly 200 challenges submitted by businesses from across the UK.

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