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How to capture Gen Z spend

Drapers Digital Festival heard from Richard Blakeborough, commercial manager – fashion at Klarna, and Pamela Burt, merchant development manager, on how to gain market share of younger fashion shoppers in an era dominated by new technology.

Widely regarded as people born between 1995 and 2010, Generation Z have grown up in a world infiltrated by digital technology and where owning a smartphone is the norm.

What do retailers need to know about these consumers to gain their custom and, more importantly, their loyalty?

1. Generation Z should be categorised by the era they grew up in, not their age

What they have in common is that they all grew up in a digital world where convenience is embedded in their day-to-day lives and dominates their buying decisions. Gen Z want to make purchases as and when they like, and they want to receive their goods immediately. In a survey, 58% told Klarna that they would pay more than $5 (£3.90) for one-hour delivery – if brands cannot compete, then consumers will take their custom elsewhere.

2. They love to shop

It is predicted that Gen Z will contribute 40% of consumer spending by 2020, despite 81% claiming money is an issue. This means that retailers must make their payment options as flexible as possible, to ensure they maximise their customer base and are offering the quickest, easiest and most affordable ways to shop.

3. They have a clean conscience

Described by Klarna as “philanthroeens”, Gen Z are value-led customers that care about the products they are buying and the brands they are buying from. Leading the way in terms of sustainability, 72% said they would pay more for sustainably sourced products, 55% would abandon a purchase if it was not sustainable, and 83% said it is important that brands prove be “pro-equality”. Retailers should align their brand values with their customers, if they want to earn the money and their loyalty.

4. Are Gen Z the “saviours of the high street”?

Klarna found that most of this generation still frequent the high street, and do so more than any other age group. They research products online before purchasing in store, so brands must make sure their digital and in-store channels are fully streamlined and as easy to navigate as possible.

 

Readers' comments (1)

  • For some retailers, Gen Z are not worth the effort. They have little money, short attention span and often give contradictory information; like Focus Groups.

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