Research & Recommendations

Add To Cart: How Gen Z Spends Their Money

By Sabine Hansen

Born between 1997 and 2015, Generation Z encompasses an era of technological advances previously uncharted by the modern economy. As this generation grows up, they begin to frame their spending habits around a relatively new market, online shopping.  

An article written by Lexington Law in early 2021 gives insight to the shopping habits of Gen Z and the lifestyle of digital natives. Growing up with the internet at their fingertips has caused teens and young adults today to rely on online platforms for their shopping needs. The fast-paced environment of the digital era pushes the accessibility of online shopping, conversely raising expectations for what is available and leading to low thresholds for low performing websites.

Additionally, as social media and targeted advertisements have decreased internet user privacy, Generation Z has become more skeptical in trusting online platforms with their information. This conservative perspective on privacy has correlations to growing up with high-profile data breaches as well as an increase in identity theft. With data sourced by Global Web Index in 2020, we can take a closer look at Gen Z preferences online. 

  • 26% of Gen Z report using social media to make a purchase in 2020 
  • 60% of Gen Z would prefer to keep their data over exchanging it for free services in 2020 
  • Gen Z spends over 8 hours online each day in 2020 
  • 72% of Gen Z reports purchasing an item online in the last month at the time of being surveyed in 2019  
  • 80% of Gen Z said they browsed an online retail store in the last month using a mobile device (surveyed 2019) 

As technology develops and use increases along side it, will we soon all be shopping exclusively online? According to Lexington Law, the answer is no. Although born into a world filled with internet alternatives, much of Generation Z still prefers to shop in person. Brick-and-mortar shopping should not be concerned with extinction as long as Gen Z is around.

While being a digital native has its perks, Gen Z is not trapped in the fantasy that buying online is inherently better, but rather enjoys the quality attached to in person shopping. By choosing to shop offline, Gen Z effectively experiences products to assert they are up to standard with their needs and wants. With data sourced by Kearney in 2019, we can take a closer look at Gen Z preferences offline.  

  • 81% of Gen Z still said they like to shop in-store (surveyed 2019) 
  • 73% of Gen Z said they utilize shopping in-store as a way to discover new products (surveyed 2019) 
  • 24% of Gen Z said a poor shopping experience prevented them from making a purchase in store at least three to four times in 2019 
  • 74% of Gen Z identified a “well curated store experience focused on a limited number of products” as either extremely or moderately important to them (surveyed 2019) 

With Generation Z beginning to take rise as an economic powerhouse, it is important to understand the importance of how today’s adolescents spend their time and money. Unlike their predecessors, Gen Z has been a part of technologies fast-paced environment since day one. From the desire to get the new iPhone to the reminding Alexa to set an alarm, Gen Z is growing up in the golden age of tech and creating greater impact on the world market each day.