Understanding Gen-Z Consumption Habits

October 15, 2021

By: Hannah Yang

Gen Z has a spending power of over $140 billion, but being between the ages of 9 and 24, it’s trickier to figure out how they will be spending their money in the future. 

Gen-Z spending priorities

A lot of Gen-Z spending currently goes into clothing, eating out, personal care, and entertainment. While the former things are easier to identify, entertainment today can include anything from video games to streaming subscriptions to events. In a world where nearly everything is becoming digitized, you can expect Gen Z to consume more tech and digital products than any other generation. 

Buying from smaller brands 

Have you heard of the term cheugy? While big brand names will always be popular, Gen Zers are also in search of more niche, unidentifiable-y cool products. Some brands are cool to own no matter the popularity level (trends are still massive within Gen Z) but some other products (like winter Ugg boots) can be seen as too popular, in an uncool way. Additionally, price is important to Gen Z—brand names are often more expensive, so teens will turn to cheaper alternatives. 

Gen Zers are informed consumers

Gen Z doesn’t always favor digital interactions. The majority of Gen Z in 2019 reported preferring in-person shopping to online. While the pandemic may have decreased that number, Gen Z views shopping as an opportunity to live outside of the digital world for a while. Although they’re shopping in stores, Gen Z is spending hours learning about these products and brands online through research, TikToks, and reviews. Within a few reviews or videos, or even just by visiting the brand site, I already have a strong view of the brand or product. I often walk into the store knowing what ingredients are in certain skincare products, what controversies a certain company caused, or what product is the best out of three different brands. 

Financial responsibility

Gen Z is financially aware, perhaps more than other generations. And we are especially resourceful on the internet, where we are bombarded by deals and ads by all sorts of brands all the time. Free shipping can determine whether or not I buy something I’m on the fence about, and a sale seals the deal. 

Influenced by social media presence

72% of Gen Z would more readily make a purchase if they followed the brand on social media. When I follow a brand on Instagram, I’m alerted of every new product and deal, every new campaign they create. It means that this info isn’t annoying to me—they don’t interrupt my feed  or flood me with posts. I already like something about the brand, whether it’s product quality, ad style, lifestyle values, or aesthetics. Seeing it semi-frequently on my social media makes it a part of my lifestyle, whether or not I own the product, and that leads to more purchases. 

Although Gen-Z spending can be harder to navigate because of the younger age range, it’ll become increasingly important in the future to understand what Gen Z prioritizes and how they behave as spenders. Directly consulting and connecting with Gen Z is crucial, and Adolescent, with a whole team of diverse Gen Zers, can help you do so.