Born between 1997 and 2012, the U.S.’s Gen Z consumers are coming of age. With the oldest among them set to turn 26 this year, their purchasing power is on the rise – having hit an estimated $360bn of disposable income last year.¹ 

But to reach this emerging demographic, businesses may need to rethink their approach. After all, Gen Z are not simply mini-millennials: they have their own identity and distinct consumer traits. And according to data from Pew Research Centre, they represent the most racially diverse and most educated generation in U.S. history.² 

They shop more impulsively

41% of Gen Z make impulse purchases online every two to three weeks, compared to just 10% among baby boomers. Gen Z are often more motivated by their community and interests than from researching a specific product, with 37% saying they make impulse purchases because it’s fun to buy/discover new things.⁶ 

They’re shopping on social

Where older generations might use search engines, the top source of brand discovery for Gen Z is social media.⁷ TikTok is their social app of choice, with 47% of its users aged between 10 and 29.⁸ It acts as a source of inspiration, where new and exciting content can appear with every scroll of the thumb, and where 61% of its users purchase products they find there.⁹ 

They use different payment methods

Younger consumers pay differently from their older counterparts. 48% of Gen Z have never written a cheque, and 44% have never applied for a credit card.¹⁰ Instead, 60% are more likely to use ‘buy now, pay later’ (BNPL) services, which can be simpler and cheaper to manage than credit cards.¹¹ 66% have also used a digital wallet in the last year.¹² With this in mind, offering a range of different payment options could help you better serve this market. 

To have authentic experiences

Having been acquainted with social media from an early age, Gen Z crave meaningful interactions with brands. They prefer content that comes across as real and not over-curated.¹³

To spend on purchases that help them enjoy their everyday lives

Gen Z consumers like to spend on live experiences, especially travel, concerts and days out. Physical items they buy are often centred around self-care, such as household products and cosmetics.¹⁴

To spend with businesses that align with their values

Gen Z see the brands they shop with as an extension of who they are, and therefore hold them to a higher standard, with 64% asserting that they’d be willing to pay more for sustainable products.¹⁵

The average Gen Z consumer got their first smartphone before their 12th birthday.

As the first truly digital native generation, social platforms are a part of life for Gen Z. Facebook, YouTube and Twitter were all founded before the first of this generation had their tenth birthday. Around 95% of the mobile phones owned by this age group are smartphones.¹⁶ In fact, the average Gen Z consumer got their first smartphone before their 12th birthday.¹⁷ 

Social media has become essential to the way they shop, with 97% of Gen Z consumers citing it as their top source of shopping inspiration.¹⁸ Alongside millennials, Gen Z are most likely to be inspired to buy products they see on social media, with 80% saying they had made purchases this way,¹⁹ and 48% having purchased directly through the app.²⁰

However, SMBs hoping to reach these consumers may need to adjust their social media strategy. TikTok is the fastest-growing platform among Gen Z outside China, with use having risen 37% since 2020.²¹ BeReal is also piquing their interest, with 34% saying they’re interested in using the app, which could point to further growth in the future.²²