Generation Z Is Here And Businesses Are Trying To Understand How They Think
Most businesses these days are trying to cater towards the spending habits of Generation Z instead of millennials. And the shift could be a total game changer.
These days, it’s not uncommon to hear how millennials managed to “kill” off entire products and industries such as snail mail, landline phones, etc. However, if the spending habits of Generation Z are to be observed, they might even be deadlier than millennials when it comes to “killing” industries.
Spending habits of Generation Z: Why it can “kill” industries
In a nutshell, Generation Z refers to the people who were born in the mid 90’s up until the early 2000’s. Compared to millennials, who have experienced an era without the internet, Gen Z grew up alongside the world wide web.
What this means is that compared to Gen X and Gen Y, or more commonly known as Millennials, the spending habits of Generation Z are vastly different.
Jean Twenge, a professor of psychology at San Diego State University shares, “Their expectations are lower, they’re not as confident.
“They’re not viewing the world through rose-colored glasses,” she continues.
Compared to Gen X and Y, Gen Z likes to play it safe. However, Gen Z prioritises wealth as well as material goods.
“In psychological terms, it’s a shift toward extrinsic values—money, fame and riches—rather than toward intrinsic values, like relationships and community feeling,” Twenge added.
This means that Gen Z has a lot of potential when it comes to their economic power. Looking solely on the impact of social media, a single Instagram, Facebook, or Twitter post can make or break an entire industry.
A great example would be when Kylie Jenner, one of the most influential people on social media, made a negative tweet about Snapchat. The result? Snapchat Inc. lost US$1.3 billion in market value. And that’s just from a single tweet. Imagine the power an entire generation can have in shaping the market.
Gen Z is shifting the marketplace online
One of the most significant changes that the spending habits of Generation Z has affected is in terms of clothing. More and more Gen Z are buying their clothes online, and physical retail stores are seeing a decline in their customers.
They also prefer shopping without a salesperson looking over their shoulder. Gen Z wants a more personal experience, and to do things at their own pace.
Print magazines are also on the decline. More and more magazines have shifted their focus towards creating a good online experience. In fact, some magazines have even shut down their print operations, and shifted completely towards an online service.
Gen Z are also more inclined to pay using credit cards and cashless options. Apps such as Venmo, Google Play, and Apple Wallet are also thriving as a result.
Soon enough, we’ll start to see the impact of Generation Z and how they’ll change entire industries. And it’s very important for businesses and companies to start looking towards the younger generation to help keep themselves afloat.
Check out our other articles below: