Dive Brief:
- Brands betting on social media to reach Gen Z may be on the right track. Eighty-five percent of respondents in the generation said social media influences their purchasing choices, according to a report by the International Council of Shopping Centers released Wednesday. Eighty-five percent of men and 86% of women said social media sways their buying decisions.
- Forty-five percent of Gen Z respondents named TikTok and Instagram as the top platforms influencing their purchasing decisions, followed by YouTube (38%), Facebook (24%), Snapchat (17%), Twitter (14%) and Reddit (7%).
- In terms of which retailers Gen Z shops, almost half (48%) said they most frequently shop at discount or off-price stores, followed by dollar stores (25%), specialty retailers (24%), fast-fashion retailers (22%) and department stores (21%). Only 13% of survey respondents said they shop secondhand most frequently, and just 9% said the same of luxury retailers.
Dive Insight:
ICSC’s new report also offers insights into Gen Z’s financial habits and concerns. Forty-one percent of Gen Z respondents said they save more money than they spend, but 36% said they spend more than they save. Eighty-four percent of older Gen Z consumers, between 23 and 26 years old, are concerned about the U.S. economy, a greater share than the 71% of 16- to 17-year-olds who said the same.
The report builds upon other research indicating that Gen Z shoppers are worried about their finances. In a spring 2023 Piper Sandler survey, teens’ self-reported spending rose 2% from the year prior. However, a September 2022 Bank of America report found that 73% of Gen Z consumers said the economic environment was making it challenging to set aside money. And more than half (56%) said inflation had put more stress on them financially.
The report also sheds some light on what elements of the shopping experience matter most to Gen Z shoppers. Nearly half (46%) of Gen Z respondents said a seamless checkout process is critical to their shopping experience, followed by fast shipping (45%) and immediate in-store availability (39%). Under a third of respondents (31%) also said free returns, and quick and helpful customer service (27%) are crucial for their shopping experience.
“Gen Z is an increasingly important demographic as more of them graduate from school, transition to their first full-time job, and mature into more spending power,” ICSC President and CEO Tom McGee said in a statement. “Our study found that many of the stereotypes and preconceived notions attached to this cohort are unfounded, however, their habits will influence retail strategy, marketplace makeup and broader economic trends for years to come.”
With Gen Z’s reliance on TikTok and Instagram, some legacy brands have leaned more toward social media marketing to court Gen Z shoppers instead of spreading their spend across more traditional channels. But while social media holds sway over the demographic’s choices, ICSC’s report also found that more than half (56%) of respondents say family and friends have the most significant influence over their buying decisions, followed by product reviews (54%) and third-party review websites and forums (47%).
