The spending habits of Generation Z exhibit yet another contradictory aspect. Limited income due to inflation and global economic issues leads to cautious spending. According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," Generation Z was the most financially challenged generation, with only 28.54% of respondents stating they were "satisfied with their current financial situation."
On the other hand, there is also a tendency to spend money on "living in the moment." Generation Z wants to be captivated by new and enjoyable products and is more inclined to spend money on experiences rather than goods, following the megatrend of "Experience More." According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," 56.6% of Generation Z considered "spending money on experiences important," and 30.61% planned to spend more on new experiences. By understanding the areas Generation Z wants to spend on and providing advice on budgeting wisely and optimizing savings, companies can attract and collaborate with Generation Z.
Additionally, companies can provide services by analyzing the bidirectional consumption patterns of Generation Z. In particular, Apple Savings, Samsung Money, and UOB TMRW are assisting consumers with appropriate spending patterns through financial advice and automatic savings.
Top 5 values to address the polarized behavior of Generation Z
Instilling a belief in the ability to drive social change acts as a key factor in bridging the value-action gap among Generation Z consumers who wish to contribute to social change.
53.6% of Generation Z believes that they can make a difference through their choices and actions. In this context, Snapchat launched the "Run for Office Mini" to encourage political candidacy and promote civic engagement. As a result, the app, which reaches 90% of 13-24 year-olds in the U.S., targeted many voters and transformed its image from a mere entertainment app to a responsible and purpose-driven partner through the empowerment of Generation Z.
Self-expression
Self-expression through creativity is an important component of Generation Z's identity and is closely related to their consumption patterns. Despite the decline of other social media platforms, user-generated social media platform TikTok saw an increase in usage among Generation Z from 37% in 2020 to 65.6% in 2023, making it the third most popular social platform used by Generation Z.
Generation Z has also shown great interest in co-creation. According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," 45.5% of Generation Z in 2023 expressed a desire to collaborate in order to influence product innovation, and this preference for collaboration is increasing every year. Co-creation, where consumers participate in product development and strategic planning, has proven to be mutually beneficial by preventing corporate myopia in new product development, predicting future trends, adapting to changes, and securing innovation advantages.
Sense of belonging
The issue of pervasive loneliness within Generation Z, influenced by economic uncertainty, affects social dynamics and reduces trust in technology. This dynamic increases the pursuit of intergenerational connections and enhances engagement within communities that share common interests and values. According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," 21.4% of Generation Z acknowledged participating in community meetings, while 48.5% stated they plan to engage more in communities in the future.
Meeting the needs for connection and belonging can navigate all three of Generation Z's polarized behaviors, but most importantly, it can increase trust in technology. As major social media platforms transition to e-commerce and become large-scale and commercialized, Generation Z is actively seeking alternative channels for meaningful social engagement. Consequently, uncensored communication platforms such as WhatsApp, WeChat, Discord, Mumble, Element, or Telegram are gaining popularity. Additionally, according to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," WhatsApp increased its market share among Generation Z customers from 57% to 61% between 2020 and 2023.
Rationality
To balance the polarized consumption patterns of Generation Z, a dual mindset must be adopted. Generation Z are primarily rational and cautious consumers, but at the same time, they indulge more than other groups. They prefer rational indulgence, which means small-scale impulsive satisfactions. According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," 30.5% of Generation Z regularly purchase small snacks, and 19.7% frequently make impulse purchases.
Additionally, according to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," Generation Z prefers "living in the moment" while adhering to pragmatism, emphasizing "quality" and "finding discounted products (34.5%)" as top shopping characteristics. To target this generation, a strategy should focus on offering trendy yet reasonably priced options, emphasizing a balance between budget-conscious choices and occasional indulgent splurges. An example of a brand that follows this strategy is Uniqlo, which offers affordable yet stylish clothing.
Retreat
Generation Z faces social media fatigue due to issues such as misinformation, cyberbullying, hyper-targeted ads, and "cancel culture" (a behavior where people unfollow and ignore individuals on social media who have made controversial actions or statements, especially celebrities or public figures). Prolonged use of technology is closely related to Generation Z's major concern: mental health issues.
According to Euromonitor's "Voice of the Consumer: Health and Nutrition Survey 2023," 55.9% of Generation Z spend excessive time on screens, leading to more common behaviors such as "monk mode" (consciously limiting exposure) or even complete disconnection. Since 2021, Lush has ceased activity on platforms like Facebook, Instagram, TikTok, and Snapchat, opting for more niche advertising through collaborations with other brands, corporate activities, or its own health app as a strategy to resonate with Generation Z.
Dreamlike, fantastical, and often bizarre images that challenge the boundaries between reality and imagination resonate with the overly anxious Generation Z. Generation Z's engagement in gaming demonstrates their preference for dynamic, engaging, and creative content to disconnect. Features such as exploring travel destinations through VR headsets (45.6% of Generation Z vs. 41.6% of general respondents), trying new products in virtual worlds (46% of Generation Z vs. 41.2% of general respondents), or simply shopping in virtual aisles (40.8% of Generation Z vs. 37.9% of general respondents) not only attract Generation Z's interest but also influence their purchasing decisions.
https://www.fashionnet.or.kr
The spending habits of Generation Z exhibit yet another contradictory aspect. Limited income due to inflation and global economic issues leads to cautious spending. According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," Generation Z was the most financially challenged generation, with only 28.54% of respondents stating they were "satisfied with their current financial situation."
On the other hand, there is also a tendency to spend money on "living in the moment." Generation Z wants to be captivated by new and enjoyable products and is more inclined to spend money on experiences rather than goods, following the megatrend of "Experience More." According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," 56.6% of Generation Z considered "spending money on experiences important," and 30.61% planned to spend more on new experiences. By understanding the areas Generation Z wants to spend on and providing advice on budgeting wisely and optimizing savings, companies can attract and collaborate with Generation Z.
Additionally, companies can provide services by analyzing the bidirectional consumption patterns of Generation Z. In particular, Apple Savings, Samsung Money, and UOB TMRW are assisting consumers with appropriate spending patterns through financial advice and automatic savings.
Top 5 values to address the polarized behavior of Generation Z
Instilling a belief in the ability to drive social change acts as a key factor in bridging the value-action gap among Generation Z consumers who wish to contribute to social change.
53.6% of Generation Z believes that they can make a difference through their choices and actions. In this context, Snapchat launched the "Run for Office Mini" to encourage political candidacy and promote civic engagement. As a result, the app, which reaches 90% of 13-24 year-olds in the U.S., targeted many voters and transformed its image from a mere entertainment app to a responsible and purpose-driven partner through the empowerment of Generation Z.
Self-expression
Self-expression through creativity is an important component of Generation Z's identity and is closely related to their consumption patterns. Despite the decline of other social media platforms, user-generated social media platform TikTok saw an increase in usage among Generation Z from 37% in 2020 to 65.6% in 2023, making it the third most popular social platform used by Generation Z.
Generation Z has also shown great interest in co-creation. According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," 45.5% of Generation Z in 2023 expressed a desire to collaborate in order to influence product innovation, and this preference for collaboration is increasing every year. Co-creation, where consumers participate in product development and strategic planning, has proven to be mutually beneficial by preventing corporate myopia in new product development, predicting future trends, adapting to changes, and securing innovation advantages.
Sense of belonging
The issue of pervasive loneliness within Generation Z, influenced by economic uncertainty, affects social dynamics and reduces trust in technology. This dynamic increases the pursuit of intergenerational connections and enhances engagement within communities that share common interests and values. According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," 21.4% of Generation Z acknowledged participating in community meetings, while 48.5% stated they plan to engage more in communities in the future.
Meeting the needs for connection and belonging can navigate all three of Generation Z's polarized behaviors, but most importantly, it can increase trust in technology. As major social media platforms transition to e-commerce and become large-scale and commercialized, Generation Z is actively seeking alternative channels for meaningful social engagement. Consequently, uncensored communication platforms such as WhatsApp, WeChat, Discord, Mumble, Element, or Telegram are gaining popularity. Additionally, according to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," WhatsApp increased its market share among Generation Z customers from 57% to 61% between 2020 and 2023.
Rationality
To balance the polarized consumption patterns of Generation Z, a dual mindset must be adopted. Generation Z are primarily rational and cautious consumers, but at the same time, they indulge more than other groups. They prefer rational indulgence, which means small-scale impulsive satisfactions. According to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," 30.5% of Generation Z regularly purchase small snacks, and 19.7% frequently make impulse purchases.
Additionally, according to Euromonitor's "Voice of the Consumer: Lifestyle Survey 2023," Generation Z prefers "living in the moment" while adhering to pragmatism, emphasizing "quality" and "finding discounted products (34.5%)" as top shopping characteristics. To target this generation, a strategy should focus on offering trendy yet reasonably priced options, emphasizing a balance between budget-conscious choices and occasional indulgent splurges. An example of a brand that follows this strategy is Uniqlo, which offers affordable yet stylish clothing.
Retreat
Generation Z faces social media fatigue due to issues such as misinformation, cyberbullying, hyper-targeted ads, and "cancel culture" (a behavior where people unfollow and ignore individuals on social media who have made controversial actions or statements, especially celebrities or public figures). Prolonged use of technology is closely related to Generation Z's major concern: mental health issues.
According to Euromonitor's "Voice of the Consumer: Health and Nutrition Survey 2023," 55.9% of Generation Z spend excessive time on screens, leading to more common behaviors such as "monk mode" (consciously limiting exposure) or even complete disconnection. Since 2021, Lush has ceased activity on platforms like Facebook, Instagram, TikTok, and Snapchat, opting for more niche advertising through collaborations with other brands, corporate activities, or its own health app as a strategy to resonate with Generation Z.
Dreamlike, fantastical, and often bizarre images that challenge the boundaries between reality and imagination resonate with the overly anxious Generation Z. Generation Z's engagement in gaming demonstrates their preference for dynamic, engaging, and creative content to disconnect. Features such as exploring travel destinations through VR headsets (45.6% of Generation Z vs. 41.6% of general respondents), trying new products in virtual worlds (46% of Generation Z vs. 41.2% of general respondents), or simply shopping in virtual aisles (40.8% of Generation Z vs. 37.9% of general respondents) not only attract Generation Z's interest but also influence their purchasing decisions.
https://www.fashionnet.or.kr