While many businesses are still struggling to wrap their heads around the Millennials in their midst, Generation Z is already emerging as the next big consumer powerhouse. An early 2018 study by Millennial Marketing estimated Gen Z’s spending power at $143 billion. That includes a combined $43 billion in earnings from allowance—yes, they are still that young—and an estimated $100 billion in earned income. That data is already a year old, and the number of Gen Zers entering the work force to earn wages instead of allowance is growing each year.
Craig Giammona, Carolina Wilson and Sarah Ponczek in an article for Bloomberg argue that it’s time for companies to understand what makes this growing market tick, and they put forward five trends. Their article is worth a read. Here, we call out a few statistics about Millennials cited by the authors that illustrate their main points.
They Can Be Influenced
Fifty-two percent of Gen Zers said they find out about new products primarily from social media. That’s 10 percent more than for Millennials.
They Have Different Vices
Close to thirty percent of Gen Z says they regularly use cannabis, compared with less than ten percent of Boomers and around fifteen percent of Gen X.
They Don’t Have to Go to Stores
While the numbers aren’t dramatic, there’s a noticeable downward trend in shopping habits. Eighty-three percent of Gen Z say they primarily shop for groceries at a physical store, compared to 87 percent of Millennials and 95 percent of Boomers.
They Choose Their Brand Loyalties Carefully
Forty percent of Gen Z say they’ll pay more for a product if they know the company is promoting gender equality issues and 42 percent said the same for companies that support racial justice issues.
They Eat (Somewhat) Differently
While the numbers for Gen Z, Millennials, Gen X and Boomers are all at five percent or below for each category, Gen Z is more likely to identify as vegetarian, pescatarian or vegan than the other cohorts mentioned.
Gen Z is not the same as their older siblings in the Millennial cohort. While they share many characteristics, interests and values, they grew up in a significantly different era. For this group, the internet has always existed; they also experienced the recent Great Recession. Failing to consider them as a distinct group is a grave mistake for marketers who want to get a piece of their growing spending power. Inclusion is a business imperative—so is understanding the unique characteristics of the emerging Gen Z market.
Related: Inclusive Products Emerge as 2019 Trend