What sets Generation Z apart from other demographic cohorts? For retailers and fashion brands, Gen Z can be found perusing the clothing racks in a brick-and-mortar retail store — and spending more money than Millennials, according to a new study released today by LIM College.
As patrons of all types of physical retail, be it department, fast-fashion, neighborhood, thrift and outlet stores, Gen Zers are shopping “more frequently and are spending more on fashion than Millennials,” according to researchers at the college.
In the study, respondents were posed with a hypothetical $1,000 gift certificate and in response 40 percent Gen Zers chose to spend it on apparel and accessories, compared to just 23 percent of Millennials.
Although differing in shopping behavior, Millennials and Gen Z respondents aligned in their overall values, including who they trust and how they communicate among other criteria, according to Robert Conrad and Dr. Kenneth M. Kambara, authors of the report.
When considering the key difference between cohorts, Conrad found material value may hold stronger resonance with Gen Z, as “Gen Z seems to be more drawn to things than the Millennials are, and they are keen to buy apparel and fashion accessories for themselves.”
This serves valuable to the fashion industry, as retailers have been ramping up their omnichannel strategies and engaging in experiential retail, in the form of pop-up shops or activations, to prepare for younger generational demands.
For Gen Zers without credit cards, instant gratification is available in fresh purchases and ribbon-handled shopping bags from nearby shopping malls. A return to malls may also reflect the need for renewed human connection, “socializing and being with their friends,” in lieu of increasing automation across the industry.
The Millennial desire for “experiences over things” allowed the retail industry to “evolve at the right time to meet the desires of Gen Z shoppers,” Kambara added.
From their findings, both LIM faculty believe there signals an “exciting new chapter in the great American retail story.”
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