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If your mental image of Gen Z is a bunch of teenagers glued to their devices, you\u2019re only half right: time has marched on, as it is wont to do, and the oldest members of Gen Z are now 28 <\/strong>years old, while the youngest members are turning 13<\/strong> this year. And there are a lot of them \u2014 they already comprise nearly one-quarter<\/strong> of the total population.<\/p>\n Retail marketers, understandably, want to appeal to this large consumer set, with spending power that\u2019s forecasted to reach $12 trillion<\/strong> by 2030, according to the National Retail Federation. Even before that, in 2029, they will overtake Baby Boomers in total generational spend, according to the 2024 Spend Z <\/em>report from NielsenIQ.<\/p>\n And despite their addiction to devices (not unique to this generation, of course), Gen Z consumers are enthusiastic in-store shoppers. However, their brick-and-mortar experience must be closely linked with their digital journeys, both before and after they visit a store.<\/p>\n But to really wow this cohort, the physical store needs to engage these consumers as well as reflect the brand\u2019s overall values (which, hopefully, are in harmony with Gen Z shoppers\u2019 values). \u201cWith Gen Z, there\u2019s a resurgence of thrifting<\/strong>, and they\u2019re also looking for sustainable packaging<\/strong>,\u201d said Paige Lustbader, Retail Audit Director at BDO USA in an interview with Retail TouchPoints<\/em>. \u201cThey want to ensure their dollar is going to the right place.\u201d<\/p>\n Gen Z\u2019s enthusiasm for in-store shopping could even be a factor in rejuvenating malls, particularly if they house retailers with a strong Gen Z connection such as Claire\u2019s, Five Below, Muji <\/strong>and Daiso Sangyo<\/strong>.<\/p>\n Gen Z has other reasons for in-person shopping: \u201cNow that we\u2019re in the post-COVID environment, people are striving for that connection and in-person experience,\u201d said Lustbader. \u201cGen Z are craving [this] because they missed out on so much during COVID. They want to be part of something and feel connected.<\/p>\n \u201cSince Gen Z now has spending power, retailers need to shift their focus to these individuals,\u201d Lustbader added. \u201cThat means in-store experiences, interactive product demos \u2014 and merging the in-store and online environments is key. In fact, pure-play ecommerce companies are realizing that they need brick-and-mortar to connect with Gen Z<\/strong>.\u201d<\/p>\n Lustbader gave the example of Warby Parker<\/strong>, which began in 2010 as an online-only retailer but recently celebrated the opening of its 300th<\/strong> store: \u201cWhen it was all about ecommerce, they were all about it, but now, you have to have a bit of both,\u201d Lustbader noted.<\/p>\n Gen Z\u2019s thirst for brick-and-mortar shopping options has helped push retailers Daiso Sangyo, Muji and Five Below onto the NRF Hot 25 Retailers list, compiled by the association and David Marcotte, SVP of Global Retail and Technology for Kantar.<\/p>\n According to Marcotte, Daiso Sangyo and Muji appeal to younger shoppers \u2014 both Gen Z and their younger cohort, Gen Alpha \u2014 with assortments that are \u201cwhat to an American is an eclectic Asian collection of goods,\u201d said Marcotte in a statement. Additionally, Muji offers a \u201cblind box,\u201d containing a small item that remains unknown until it\u2019s opened, feeding these consumers\u2019 desire for a \u201ctreasure hunt\u201d-style experience. Both retailers increase their allure by including events that \u201cgenerate enormous foot traffic at malls,\u201d Marcotte added. \u201cThey\u2019re creating the energy to make the mall come alive.\u201d<\/p>\n In fact, with one survey indicating Gen Z is as likely to shop at a mall as their Boomer forebears, they are driving a new trend in commercial real estate \u201cto take older malls and make them into Gen Z malls,\u201d said Marcotte.<\/p>\n As for Five Below, the retailer is slowly \u201caging\u201d its product assortment: \u201cThey started by targeting tweens, but have expanded to reach young adults,\u201d he noted.<\/p>\n 1.<\/strong> Support sustainability with actions, not just promises:<\/strong> When Coach<\/strong> developed its new Coachtopia<\/strong> sustainable fashion brand, it tapped into the fun, edgy designs that Gen Z loves, but it also developed a scalable model for reusing leather and other materials to create its products.<\/p>\n \u201cCoachtopia has done an amazing job speaking to this generation of young shoppers who care about consumerism, circularity and the environmental impact of their shopping choices,\u201d said Marie Driscoll, Adjunct Professor at Parsons The New School in an interview with\u00a0Retail TouchPoints<\/em>. \u201cBy designing products from inception with a circular mandate, Coachtopia is truly differentiating the brand and the product in the marketplace and has become a brand that younger shoppers are eagerly wearing and advocating.\u201d<\/strong><\/p>\n 2.<\/strong> Show that your brand values diversity and inclusion: <\/strong>Mark Pingol, SVP at research firm Savanta, noted that Gen Z consumers\u2019 support for inclusivity and accessibility has inspired some brands to broaden their appeal through more diverse product design. Gucci<\/strong> has leaned into informal luxury, \u201cwhich marries streetwear and luxury in a way we have not seen before,\u201d said Pingol in an interview with Retail TouchPoints<\/em>. Additionally, brands such as Miu Miu<\/strong> have taken a genderless approach to fashion design, part of the \u201cinclusive luxury\u201d trend.<\/p>\n 3. Talk with Gen Z, not at them \u2014 and listen to them:<\/strong> This is about more than just using the right Gen Z lingo in your communications (although that\u2019s important). Many retailers are reaching out to members of Gen Z and Gen Alpha for ideas and inspiration. In February 2024 Claire\u2019s began tapping a range of young creators and influencers for The Collab, inviting them to share stories, talents and perspectives via ongoing content development and social dialogue. The original seven<\/strong> members of The Collab \u2014 one as young as seven <\/strong>years old \u2014 were invited to participate in styling photo and video shoots, creating content and hosting events over a 12<\/strong>-month period.<\/p>\n 4. Leverage social media and social commerce as touch points: <\/strong>\u201cSocial media plays an important part for Gen Z, both in terms of buying from platforms and with influencers starting their own brands,\u201d said BDO\u2019s Lustbader. \u201cIt\u2019s another way of bringing their attention to products, even if they\u2019re not necessarily buying\u201d on a social platform; it\u2019s just \u201cone place they can go shopping. Gen Z likes multiple ways of buying what they want. And retailers need to provide a seamless experience between online and in-store to be successful.\u201d<\/p>\n<\/p><\/div>\nPost-COVID Search for Connection Motivates Gen Z<\/strong><\/h3>\n
Could Gen Z Pave the Path to Malls\u2019 Resurgence?<\/strong><\/h3>\n
Best Practices for Gen Z-Friendly Retailing<\/strong><\/h3>\n