Individuals born between 1997 and 2012 are considered “Generation Z” or “Gen Z”. The older individuals born in this generation have begun their professional careers, and while they might not have reached their full economic potential, Gen Z still represents $450 billion spending power globally.
From conducting online research about a product to checking a brand’s social media account to shifting to an online mode of payment instead of cash, Gen Z’s spending and buying habits are massively different from those of other generations. In this article, we will take an in-depth look at Gen Z’s spending and buying habits in 2024 to understand how Gen Z is spending their money.
Top Gen Z Spending and Buying Habits (2024)
- The spending power of Gen Z is $450 billion.
- 57% of Gen Z prefers to be contacted by brands through Email.
- On Average, Gen Z spends $1,885 on their pets every year.
- Gen Z is expected to represent a global retail spending of 17% by 2030.
- Gen Z will become a leading force in the workplace in the U.S. by 31% in 2031.
- 68% of Generation Z are eco-friendly shoppers.
- Clothes and shoes are the leading shopping category purchased by Gen Z.
- Around 68% of Gen Z are eco-friendly buyers.
Gen Z has a spending power of $450 billion
Gen Z are yet to reach their complete economic potential, but still, they represent an estimated $450bn spending power worldwide. The economic influence of Gen Z is expanding as more of Gen Z are reaching adulthood. According to experts, the younger generation not only has money but they are also willing to spend it having high financial anxiety. But as most people might assume Gen Z are not just spending their hard-earned money on anything instead they are extremely deliberate on the money they spend.
source: (BBC)
40% of the global consumers are Gen Z
Gen Z’s spending power is expected to reach trillions of dollars every year in the coming years. Despite being only 30% of the total population, Gen Z represents 40% of the global consumers. Experts also suggest that by 2025, Gen Z is expected to make up to 27% of the total workforce.
Gen Z monthly online shoppers worldwide, by category
When it comes to Gen Z, clothing and shoes are the top shopping categories purchased by Gen Z consumers during the second quarter of 2023 by 57%. Entertainment is ranked as the second most popular shopping category by Gen Z by 44%. Electronics is also another essential shopping element among Gen Z with 40% of purchases and beauty comes in fourth position with 35% of purchases. Child products have the lowest purchase frequency among Gen Z which is quite understandable as the majority of Gen Z consumers are either college students or young adults.
Below we have mentioned a table showcasing Gen Z monthly online shoppers worldwide by category:
| Shopping category | Share of respondents |
| Clothing & shoes | 57% |
| Entertainment | 44% |
| Electronics | 40% |
| Beauty | 35% |
| Leisure, sport & hobby | 32% |
| Jewelry & accessories | 28% |
| Groceries | 24% |
| Automotive spare parts or accessories | 21% |
| Home & garden | 21% |
| Pharmaceutical products | 21% |
| Erotic materials and toys | 19% |
| Children products | 19% |
Source: Statista
U.S. Gen Z Clothes Shopping Frequency by Gender
In 2022, a survey was conducted in the United States to understand the apparel shopping behaviors of Gen Z Americans based on their gender. It was revealed that two-fifths of the female Gen Z consumers shopped for clothes one to two times a month, while 23.6% of the Gen Z male consumers shopped for apparel one to two times a week.
Below we have mentioned a table showcasing the shopping frequency of the U.S. Gen Z by Gender:
| Shopping Frequency | Female | Male |
| Everyday | 12.1% | 10.2% |
| 3 to 4 times a week | 15.2% | 27.3% |
| 1 to 2 times a week | 13.6% | 23.6% |
| 1 to 2 times a month | 40.9% | 16.8% |
| Every 2 to 3 months | 13.6% | 14.5% |
| Rarely or never | 4.5% | 6.8% |
Source: Statista
Source of Inspiration for Purchases among Gen Z
Unlike other generations, Gen Z is more likely to gain inspiration for shopping and purchasing products from a variety of different sources. This includes looking for shopping websites (51%) and social media platforms (47%), considering opinions from family and friends (45%), visiting brands’ stores (44%), and lastly watching television for inspiration (17%).
| Top Factors | Likelihood to Purchase |
| Shopping websites | 51% |
| Social Media | 47% |
| Friends and Family | 45% |
| In-store | 44% |
| Television | 17% |
Top Social Media platforms used by Gen Z to purchase products
Talking about social media platforms as an essential source of inspiration for Gen Z to purchase a product. Reports suggest that the majority of Gen Z turn to YouTube (47%) as their ideal social media platform to conduct their research and learn about the products, their advantages, and disadvantages, etc. Followed by Instagram (29%) as the second most useful platform for purchasing products.
Below we have mentioned a table showcasing the top social media platforms used by Gen Z to purchase products:
| Social Media platforms | Likelihood to Purchase |
| YouTube | 47% |
| 29% | |
| 21% | |
| TikTok | 17% |
| 6% |
Gen Z resonates with a brand that’s affordable, authentic, and transparent
There is a massive difference in the shopping habits of Gen Z compared to other generations as Gen Z users are more likely to purchase products from a brand that are affordable, transparent, and authentic.
- Around 62% of Gen Z consider affordability extremely important to make a purchase.
- 32% of Gen Z claims brand authenticity plays a crucial role in the decision-making towards buying a product.
- 25% of Gen Zers value brand transparency.
60% of Gen Z buyers won’t use a website or app that is difficult to navigate or loads slowly (Forbes)
Efficiency is one of the most crucial aspects of Gen Z when it comes to purchasing or researching a product. A survey revealed that 60% of Gen Z shoppers claim the ability to find products and services quickly is an essential aspect for them. Around 65% of the consumers claimed they had switched to a different brand due to a slow experience.
Therefore, it’s highly important for retailers to spend effort and care towards the online assets to ensure the website or app functions smoothly without making the consumer wait for a long duration. It’s important the interface is simple and easy to use, the website or app contains all the essential information about the brand, and most importantly it functions at a good speed.
Influencers have a great impact on Gen Z.
In comparison to older generations, a large section of Gen Z buyers is likely to depend on and trust the opinions of an influencer. Gen Z often chooses to follow a variety of influencers on social media platforms such as Instagram, TikTok, and YouTube with high following and reach and often consider their review regarding a particular product before actually purchasing it.
According to a study by Google, it was revealed that 70% of teenagers are likely to subscribe to YouTube channels and consider YouTube personalities to be more relatable and influential compared to traditional celebrities.
Increased usage of Mobile payments among Gen Z
Gen Z was born in the digital era, where almost everyone has easy access to smartphones and the internet. Due to the fact that Gen Z has grown in this era, they have embraced the usage of mobile payments such as mobile wallets (such as Apple Pay or Android Pay) and mobile paying apps more than any other generation. In the last few years, mobile apps have gained immense popularity from people across the world, encouraging more and more people to perform online payments instead of using cash.
Types of social media accounts Gen Z shoppers followed and purchased from worldwide.
During the first quarter of 2023, Australia and Portugal became the leading countries with the highest share of Gen Z buyers who followed and purchased from brands on social media accounts at 71%. Furthermore, the report suggests that Portugal (59%) is ranked second in terms of Gen Z consumers who followed and bought products from retailers’ social media accounts, falling behind New Zealand (61%). Meanwhile, Austria (66%) and the Netherlands (58%) became the leading countries with the highest percentage of Gen Z consumers who followed and purchased from Influencers.
Below we have mentioned a table showcasing the Types of social media accounts Gen Z shoppers followed and purchased from globally:
| Country | Influencers | Brands | Retailers |
| United States | 51% | 66% | 50% |
| United Kingdom | 52% | 52% | 46% |
| Sweden | 32% | 68% | 41% |
| Spain | 47% | 68% | 33% |
| Australia | 48% | 71% | 43% |
| Austria | 66% | 50% | 32% |
| Belgium | 39% | 56% | 25% |
| Finland | 53% | 47% | 57% |
| France | 55% | 63% | 31% |
| Germany | 53% | 50% | 34% |
| Ireland | 46% | 63% | 46% |
| Italy | 43% | 67% | 34% |
| Netherlands | 58% | 47% | 23% |
| New Zealand | 46% | 66% | 61% |
| Norway | 51% | 49% | 45% |
| Poland | 45% | 64% | 37% |
| Portugal | 51% | 71% | 59% |
Source: Statista
Gen Z preferred channels to be contacted by brands
According to a survey conducted in 2022, Email is the most preferred channel among Gen Z consumers for brands to contact them. Social Media is the second most popular channel, with 44%, and Text messages are the third most popular option, with 44%.
Below we have mentioned a table showcasing the leading channels that Gen Z preferred to be contacted by brands:
| Top Channels | Share of respondents |
| 57% | |
| Social Media | 44% |
| Text messages | 44% |
| Phone call | 25% |
| None of the above | 15% |
Source: Statista
Top Channels Gen Z began their shopping journey.
During the first quarter of 2023, Gen Z consumers’ shopping journey began majorly in online stores (44%), followed by the search engine as the second most popular channel, as reported by 40% of the respondents. Physical stores became the third most popular channel, with 35%, and social media ranked fourth, with 30%.
Below we have mentioned a table showcasing the top channels Gen Z began their shopping journey during the first quarter of 2023:
| Top Channels | Share of respondents |
| Online Store | 44% |
| Search engine | 40% |
| Physical store | 35% |
| Social media | 30% |
| Browsing websites or apps | 30% |
| Talking to families or friends | 20% |
| Online marketplace | 20% |
| Price comparison service | 15% |
| Physical magazines or other media publications | 7% |
Source: Statista
Gen Z pet owners spend the most on their pets in the United States
Pet ownership among Gen Z is on the rise as more and more young adults and teenagers are adopting pets for companionship. The digital world has made Gen Z lonely and depressed and pets offer unconditional support and love. In fact, according to a survey in 2021 also showcases how Gen Z is the leading generation that spends the most on their pets in the United States. Gen Z spends an annual expenditure of $1,885 on their pets, while Millennials are ranked second with an annual expenditure of $1,195.
| Generation | Annual expenditure on pets |
| Gen Z | 1,885 |
| Millennials | 1,195 |
| Gen X | 1,100 |
| Baby Boomers | 926 |
Source: Statista
Gen Z is willing to spend on Sustainable products
Sustainability is something Gen Z has high regard for and therefore it plays a significant role in Gen Z’s purchasing decisions as well. Regardless of the thriftiness, Gen Z consumers are willing to pay additional amounts for eco-friendly products. Therefore, to harness Gen Z’s spending power therefore brands should improve their sustainability goals:
- 75% of the Gen Z respondents have revealed they consider sustainability extremely important while making a purchasing decision.
- 64% of Gen Z consumers have stated they are willing to pay more in return for sustainable products.
- Take good care of the Packaging of the products as Gen Z takes packaging into consideration while purchasing something. A survey by Kearney revealed that 65% of the Gen Z respondents stated they wanted simple packaging, while 58% of the respondents claimed they were looking for eco-friendly packaging.
- 36% of Gen Z consumers are likely to purchase second-hand products for sustainability and the environment.
- According to a survey by Kearney, 57% of Gen Z respondents claimed they were looking for locally spruced products or eco-friendly products.
Gen Z is the leading generation to pay an additional amount for sustainable products
35% of consumers claim they are willing to spend an additional 25% more than the original price for sustainability. When it comes to sustainable products, surprisingly, Gen Z is the leading generation willing to spend more money to ensure the brands are eco-friendly. Gen Z takes special consideration of the material utilized by brands, ensuring the brand is suitable, followed by ethical practices.
60% of Gen Z consumers are likely to support small businesses
Young consumers are much more likely to support and show interest in small businesses than older generations. Around 60% of Gen Z have showcased an interest in purchasing products from small brands, compared to Millennials (59%), Gen X (42%), and Baby Boomers (20%).
Gen Z is turning up towards rented clothes
Rented clothes have gained massive popularity among Gen Z in the last few years as people turn down fast fashion and spend heavy amounts on clothing. According to a report by IMARC Group, the online clothing rental market is exploding in terms of demand, and the market reached $2.2 billion in 2023.
Around 80% of Generation Z are purchasing secondhand
“Recommerce” has been driving Gen Z’s shopping choices at an extensive scale. Apparently, the second-hand clothing market has been witnessing excellent growth as more and more Gen Z consumers are investing in second-hand products. According to a report by Thredup, by 2030, the second-hand clothing market will be valued at $84 billion.
49% of Gen Z consumers are likely to purchase a product because it’s owned by people of color
There is still a massive difference in the number of businesses owned by people of color compared to their white counterparts. Around 14.2% of the population is represented by Black Americans, and according to a report by Brooking 2.4% of the employer-firm owners are accounted by Black Americans. While Latino or Hispanic people represented 18.7% and the percentage of employer-firm owners was 6.5% Hispanic or Latino Americans are also underrepresented just like Black Americans. However, between 2019 and 2020 there was a significant rise in the number of firms owned by Black or Hispanic Americans thanks to Gen Z’s commitment and support towards buying their brands.
83% of Gen Z consumers are likely to purchase from brands that they trust with their personal information
Gen Z is critical about their personal data, and with a variety of companies on the news for their breaches and mishandling of customer data, Gen Z has only become cautious while selecting brands for their purchases. Therefore, Gen Z consumers pay special care to how brands and companies utilize their data before purchasing a product.
FAQs
What are the purchasing habits of Gen Z?
Gen Z’s purchasing habits include using social media to make purchases, communicating online via smartphone, investing in sustainable products, and more.
What is the consumer buying behavior of Gen Z?
Gen Z’s consumer buying behavior includes conducting online research, comparing products and their prices with other sites, and checking online reviews before making a purchase.
How is Gen Z spending their money?
57% of Gen Z are spending their money on Clothing and shoes, while 44% are spending it on Entertainment. Electronics, Beauty, Groceries, Accessories, etc are some of the other top categories where Gen Z are spending their money.
What motivates Gen Z to buy?
Various factors motivate Gen Z to buy, such as good online reviews, sustainable products, a brand’s good social media presence, affordable prices, authenticity, and more.
What are Gen Z’s interests in 2024?
In 2024, Gen Z’s interest lay in Social Media and the most popular social media platforms among Gen Z are YouTube, Instagram, and TikTok.
What is Gen Z wearing in 2024?
In 2024, Gen Z are wearing baggy, low- or mid-rise jeans by ditching the regular straight or skinny jeans.
Takeaway
The spending and buying habits of Gen Z have taken a 360-degree turn compared to other generations. Unlike Millennials or Baby Boomers, Gen Z doesn’t believe in directly purchasing a product; instead, they prefer to conduct thorough research on the product and the brand before spending their hard-earned money. Today, Gen Z resonates with those brands and businesses that are affordable, authentic, and transparent. Apart from this, the social media presence and sustainability of a brand also play a crucial role in the purchasing decision of a Gen Z consumer.
