Retailers have been talking about how millennials have transformed retail for years: The digital natives have grown up with mobile technology and expect to use it in every aspect of their life – including shopping – forcing retailers to digitize their operations for greater efficiency and growth. Millennials demand a seamless omnichannel, customer-centric experience, and smart retailers have taken notice as their buying power will soon surpass that of generations before them.
While millennials have long impacted how retailers develop and deliver their products, their successors, Gen Z, are slowly stealing the spotlight. Gen Z consumers have an annual U.S. purchasing power of $44 billion, and they’re on track to be the largest group of consumers worldwide by 2020. While both groups seek a more personalized experience, Gen Z is more tech savvy than any others before them: they’re early adopters of social platforms (including YouTube, Facebook, Instagram and Snapchat) and expect the ability to purchase directly off these platforms.
Gen Zers last great experience is their new expectation, and retailers must closely monitor their operations to ensure they’re prosperous for years to come. This means, in part, becoming more sustainable: According to a 2017 report, 45 percent of Gen Zers say they choose to shop with brands that are eco-friendly and socially responsible. What’s more, 66 percent agreed that product quality matters when choosing a company to buy desired items from.
Gen Z is certainly perpetuating a major shift in overall consumer shopping behavior, From browsing products online to demanding an immersive in-store experience (think unique, curated products, AR/VR capabilities and mobile integration), younger consumers are keeping retailers on their toes. To ensure their operations run smoothly, retailers must combine the best of physical and digital retail to successfully reach the newest consumer generation. By investing in in-store, interactive technology, organizations can attract Gen Z consumers as personalized, digital experiences will best fulfill their customers’ desires.
While this may take retailers some years to accomplish, they can jumpstart the process by investing in their backend: that means implementing digital solutions from sourcing to design, all the way through delivery. This continuous cycle of transformation is nothing new for retailers, but to cater to Gen Z needs, organizations must fully embrace digital experiences and ensure a seamless consumer experience online and in store.
Gen Z and millennial consumers don’t only impact the retail’s front-end. Read more on how millennials are poised to transform backend operations.