A new report by UK consultancy firm Alchemmy found three in four (75%) Gen Z consumers make purchases based on their values. This compares to only 67 percent of the general population.
The report Future of Retail: Is Generation Z leading the way? explores consumer retail behaviour of all generations. It found three in five (58%) Gen Zers are more likely to buy products with sustainability claims, compared with just 45 percent of all consumers.
The study gives further evidence of how the retail industry will have to adjust in the future as Gen Z increases its spending power and influence on the market.
The value of values
Alchemmy’s research also found that while the cost of living crisis and rising inflation have had a huge impact on consumer decision making, Gen Z is not willing to sacrifice ethical values for a good deal. 82 percent of Gen Z describe price as a very important factor, however this is a full ten percent lower than the general population (92%).
Maintaining values when making purchases is having an impact on the Gen Z generation. The report highlighted that sustainability is more important to Gen Z than deals, offers or rewards when compared to older generations. Over half (58%) of Gen Z consumers said they would pay more for products with sustainable credentials.
Alchemmy’s Director of Retail and Consumer Lucy Gibbs says: “With consumer confidence at an all-time low and an unprecedented cost-of-living crisis looming, retailers now need to listen harder and think bigger at a time when business-as-usual is already challenging enough. Gen Z has lived entirely as digital natives in turbulent times and is uniquely placed to provide the inspiration that lights the way.
“They are focussed on value but their values still come first. They seek community experiences but demand deep personalisation and infinite choice. They will embrace advances in intelligent automation if it makes life easier but doesn’t come at an ethical cost. Making sense of all of this is essential for retailers to truly understand customers and win the hearts and minds to stay ahead of the competition.”
Implications for the future of retail
As the first true digital natives, the report found that Gen Z is the generation most likely to purchase on social media (23% vs 13% across all generations) and aren’t afraid to shop through a range of channels.
Half of Gen Zers are happy to see automation used if it provides a faster retail service (54%) and improved product and offers recommendations (49%). This is compared with only 37 percent across all generations.
Alchemmy will be hosting a panel event ‘Gen Z and the Future of Retail’ on 2nd November 2022 to explore the themes covered. Find out more at: https://alchemmy.com/events/
