There’s at least one group of shoppers excitedly hitting malls this holiday season — and they don’t seem to be too bothered about pesky inflation eating into their discretionary dollars.
They’re Gen Z. And the way they shop matters.
This cohort of consumers born between 1997 and 2012 is among the fastest-growing groups in the country, along with Millennials. Together, this demographic is expected to grow to 70% of the population by 2028, versus 60% today, according to a note from Cowen Equity Research.
“One standout this Black Friday was the high turnout of Gen Z in stores,” said Kristen Classi-Zummo, apparel industry analyst with market research firm NPD. “Younger consumers flooded the mall, treating Black Friday as a social event. They came early, they came with friends, and they came to shop.”
She said the prevalence of younger shoppers on Black Friday and over the Thanksgiving holiday shopping weekend surprised her. “It’s something I’ve never seen in previous years,” she said.
Mall operator PREIT, which owns 18 shopping centers primarily on the East Coast, confirmed that Gen Z consumers were out in force.
“Over Black Friday weekend, we saw shoppers of all ages but certainly saw a strong showing from a youthful crowd and some of our strongest anecdotal sales reports came from top Gen Z brands and fashion department stores,” said PREIT CEO Joe Coradino.
It could also explain why in-store shopping trumped the online option this Black Friday.
The National Retail Federation estimates that more than 123 million people visited brick-and-mortar stores over the Black Friday and holiday weekend, up a strong 17% from 2021, while the number of online shoppers grew at a much slower 2% pace to 130.2 million. Overall, the group said a record 196 million Americans shopped over the five-day holiday period from Thanksgiving Day to Cyber Monday, a 10% increase from last year.
“For Gen Z, it wasn’t just about shopping. It was about hanging out and having fun together as a group,” said Classi-Zummo.
Brands matter. Price, not so much
When it comes to clothing, a particular weakness of younger consumers, Gen Zers are showing a tendency to be more price agnostic — but are very discriminating about brands they buy.
Industry experts credit social media platforms such as TikTok and Instagram for establishing the “it” labels of the moment, which include pricey athleisure brand Lululemon — where a pair of leggings can cost $120 or more — Gen Z-favored expensive fashion brand Aritzia and mid-priced clothing chains such as Garage, Pacsun and Aerie.
“Promotions aren’t the draw for these shoppers,” said Classi-Zummo. “One in three shoppers aged 18 to 24 looks at social media first to do their shopping research,” she said, citing findings of an annual NPD survey.
“At the same time, this generation is also open to finding inspiration in other channels and that includes browsing in stores. And we saw that over Black Friday,” she said.
While older consumers are more price sensitive, especially in an inflationary environment, chasing discounts isn’t always top of mind for trend-hungry teens.
But with price hikes at 40-year highs, Gen Z’s approach to shopping has shifted slightly.
“They will get the must-haves on their wish list, regardless of price, and maybe put back the nice-to-have items,” said Classi-Zummo.
Other than clothes, what did GenZers buy over the Black Friday weekend?
“Mostly beauty items and electronics,” said Brian Mandelbaum, CEO of consumer data company Attain. “Their top retailers were Best Buy, Sephora, Ulta and TJ Maxx.”
“Gen Z and their spending, by and large, is all discretionary,” said Mandelbaum. “They aren’t burdened as much by bills so they’re not thinking as much about inflation and prices.”
Millennials, he said, did most of their spending at discount, home décor and department stores, including Amazon, Kohl’s and Target.Read Original Article