Spotlight on…Generation Alpha

TRENDS & INSIGHTS


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Market intelligence icon
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MARKET INTELLIGENCE




Spotlight on…Generation Alpha

Be prepared for Generation Alpha. It’s going to be the largest generation ever, and it’s already exerting significant spending power. Are you ready?


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Average reading time: 4 minutes





Executive summary

Generation Alpha will be the largest ever at over 2 billion people, making it a powerful economic force both now and in the future.


Members of Gen Alpha are digitally native, with brand discovery and purchasing heavily influenced by social media.


They like to blend online with offline, however, potentially making true omnichannel experiences more valuable to them.


Their values are heavily influenced by their millennial and Gen Z parents, but it’s essential to recognise their own unique traits and preferences.






Kids looking at mobile phone
Kids looking at mobile phone
Kids looking at mobile phone



25% pie chart
25% pie chart
25% pie chart

25%

say that social media influences what they want to buy


Generation Alpha, those born between 2010-2025, is going to be a force to be reckoned with. When all the Gen Alpha babies have been born it will be the largest generation ever – at a huge 2 billion people1 – but there’s much more to it than just its size.

As the children of millennials and Gen Z, they are adopting many of their parents preferences and ideals. Yet they also have their own traits that make them stand out as distinct, driven by their life experiences.

For example, Gen Alpha have grown up with technology completely integrated into their lives. The oldest was born in the year that Instagram was launched, and they are the most digitally native generation so far.2 This is likely to be hugely influential on where and how businesses communicate with potential customers. For example, 25% say that social media influences what they want to buy, second only to friends at 28%.3

Gen Alpha has also lived through a time of heightened social and environmental concerns, and this is already having a wider impact on purchasing habits. As many as 80% of parents say their children have influenced their actions or consumption decisions and made them more environmentally aware.4

The broader economic figures are just as powerful. It is expected that in 2024, Gen Alpha will either account for or influence $1 trillion worth of spending worldwide – rising to $1.7 trillion by 2029.5




Gen Alpha in numbers

$5.46 trillion

Worldwide economic footprint of Gen Alpha by 20296


11%

Percentage of the global workforce that will be Gen Alpha by 20307


2.8 million

Number of Gen Alpha babies being born each week8


10

Age by which almost two-thirds of Gen Alpha children own a smartphone9






A closer look: Generation Alpha online

Generation Alpha are early adopters when it comes to technology. Over 40% of them have used a tablet before age 6 and, at 63%, the percentage of Gen Alpha members who value having the latest technology is more than double that of Gen Z (31%).10




63% pie chart
63% pie chart
63% pie chart

63%

The percentage of Gen Alpha members who value having the latest technology is more than double that of Gen Z (31%)


Girl playing with a tablet
Girl playing with a tablet
Girl playing with a tablet

They are also very much a social media generation, at least where marketing is concerned. Research from Razorfish shows that over half of them say they first hear about brands on YouTube.11

But while that suggests an essential channel for businesses to consider, it’s also important to make sure any efforts are targeted appropriately, with indications showing that Gen Alpha are taking a more considered view. For example, research from GWI suggests that social media as a time-filler is in decline, but using it as an entertainment channel to find funny and entertaining content is increasing in popularity.12

And similarly, just because this generation has grown up entwined with online content, it doesn’t mean it is always the focal point. Research shows that they like to strike a healthy balance between online and offline activities, and only 20% say they would like to spend more time online.13





Three more things to consider




Magnify glass icon
Magnify glass icon
Magnify glass icon

Understand the demand.

One expected impact of growing up with screens from a very early age is that Gen Alpha will likely be more demanding of the digital experience.14 But that’s not all. They are also likely to be much more demanding over sustainability and responsibility too. These values are being ingrained from an early age, passed on from their millennial and Gen Z parents, with Gen Alpha also increasingly aware of how personal choices impact the environment.15 Understanding these demands, and how they affect what they are looking for in the products they buy and companies they buy from, could make a big difference.




Laptop icon
Laptop icon
Laptop icon

Think omnichannel.

Technology is embedded into Gen Alpha lives, they have always had knowledge at their fingertips, and they are highly influenced by social media – yet research shows that 60% prefer buying in stores.16 This may partly be due to a lack of access to debit or credit cards to buy online, as well as an awareness of the sustainability impact of shipping goods, but 75% of children say they like the experience of going to a retail store.17 With Gen Alpha valuing both online and offline experiences, it’s worth thinking about how that could translate into an omnichannel strategy.




Smartphone icon
Smartphone icon
Smartphone icon

Gamify the experience.

Generation Alpha don’t just play online games for entertainment, they use them as social networks and to hang out with friends.18 With major brands already using games such as Roblox to capture the attention of Gen Alpha,19 how could your business tap into gamification to appeal to this audience as they grow into active consumers?



Disclaimer: The information provided on this page does not constitute legal, tax, finance, accounting, or trade advice, but is designed to provide general information relating to business and commerce. The FedEx Small Business Hub content, information, and services are not a substitute for obtaining the advice of a competent professional, for example (but not limited to) a licensed attorney, law firm, accountant, or financial adviser.

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