If retail was a target-based dart game, then hitting Gen Z would be the bullseye. Not because they have the most spending power or the most stable jobs, but for a variety of factors that make them, if nothing else, a good investment.
Combined with millennials, the two youngest groups are poised to make up roughly 70% of the global population by 2028, according to a report emailed to Retail Dive by Cowen. That’s 70% of consumers who are digitally fluent, value price when making purchase decisions and lean on Amazon like a girl with a broken leg.
“Today’s modern consumer is savvy,” Jeff Fromm, co-author of “Marketing to Gen Z,” told Retail Dive in an interview. “They carry a weapon with them and it’s not a phone — it’s a modern-day Swiss army knife.”
The Swiss army knife that has widely become known as the smartphone ensures not only that Gen Z and millennials are more informed than their predecessors, but also that they’re partial to sites like Amazon, which give them all the information they need about a product in a short and simple manner.
Cowen’s report on the two youngest demographics highlights not only the biggest trends coming down the pipeline, but also who’s sitting at the top — and who’s not.
Why is it always Amazon?
The perennial top dog — from winning price wars with Walmart to the sheer volume of the Prime membership base — Amazon shows no sign of slowing its dominance with the two youngest consumer groups. Perhaps discouraging for the rest of the retail industry, though not altogether surprising, the e-commerce giant is hugely popular with young shoppers as well as old.
According to Cowen’s report, 90% of customers aged 18-54 said Amazon was their preferred shopping channel, or named the company along with other stores. While that covers a rather large age and preference range, the e-tailer also performed well with exclusively young demographics: Almost a quarter (24%) of 18-24 year-olds and roughly the same number (25%) of 25-34 year-olds cited Amazon as their sole preferred channel — almost 10% higher than the amount reported by shoppers aged 45-54 (16%).
“They’re bringing fresh and new, which is what we should expect from brands, but they’re upping the game on all the other players by doing it rapidly and continuously.”
Co-Author of “Marketing to Gen Z”
The reason for Amazon’s success is two-fold, according to Fromm. First there’s the price check capability, which allows young shoppers with convenience on their mind to make sure they’re getting the best deal, wherever they are (Amazon is actually the last place that 30% of 18-24 year-olds check when making an online clothing purchase, per Cowen’s data). Then there’s the “Amazon effect,” caused by Amazon’s constant striving to reinvent and improve, which puts other retailers in a bad light.