Sell ​​to Gen Z? Here’s what small businesses need to know

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By Rieva Lesonski

Members of Generation Z (also known as Zoomers) are growing up. The vanguard of the generation enters the labor market and is prepared to spend money. But before you can sell to them, you need to know what Gen Z cares about and how they shop.

Insider intelligence recently spoke to Zoomers to find out what motivates them to spend money.

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How to sell to Gen Z: Find out what motivates them to buy

Sustainability on a budget

For years, we’ve been told that Gen Z is “one of the most enduring generations.” But most Zoomers are still in their teens or early twenties. And while they care about the environment, they are on a tight budget and “choosy” about how they spend their money.

Insider intelligence says this mindset is one of the reasons thrift stores have become so popular, allowing Zoomers to buy the brands they like while also being environmentally conscious by avoiding throwing an item out.

Brand awareness

Consumers, particularly Gen Z, are more aware of the actions and views of corporate brands as they monitor them through social media. This can be beneficial for businesses, especially small businesses, that can showcase the human side of their business, making them more recognizable. Insider intelligence says: “Social media presence adds a human element, making [your business] more about the people than about the products.”

However, it can also expose views and actions that Zoomers disagree with, causing them to quickly abandon your brand and look for a company that better aligns with their values.

Who do they trust?

TikTok is extremely popular with Gen Z – indeed it is their “preferred platform to discover new products, especially in the beauty category.” A Zoomer told it Insider intelligence that TikTok gives them more current content and exposes them to more new products or products that have gone viral than YouTube.

But like most consumers of all ages, Zoomers say recommendations from friends and family influence them the most when making a purchase.

They are less loyal

Since Gen Zers are “very aware of how much they consume”, they are less loyal than older generations. One Zoomer said she’s “a departure from loyalty programs that make you try to buy more.” Instead, she opts for loyalty programs that focus on sustainability or offer discounts.

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They don’t shop in the metaverse

While there’s been a lot of buzz about the metaverse, Zoomers aren’t shopping there just yet. Some believe the metaverse will “evolve” into something they can use one day. But Insider intelligence says to keep an eye on the next generation (Generation Alpha), which may be more inclined to shop in the digital universe.

Another survey, Square and Afterpay’s State of Retail report, shows that younger consumers (Zoomers and millennials) are increasingly shopping via mobile commerce. It reports, “Over the past year, two-thirds of Millennials and Gen Zers’ online Afterpay transactions were made on mobile devices, with the volume of Afterpay transactions increasing 196% since 2020.”

These younger consumers also use their mobile devices “as their main customer support tool”.

“Buy now, pay later” has arrived

The retail report also shows that while Zoomers and Millennials are the leading users of “buy now, pay later” (BNPL) services today, Gen Xers and Baby Boomers are increasingly adopting BNPL options.

One of the reasons Zoomers are embracing BNPL is that they buy more luxury items, which obviously cost more money. Gen Z’s share of luxury spending is now 16%, down from 13% in 2019, while Millennials’ luxury spending has fallen from 56% to 45% between 2019 and 2023. This is partly fueled by returns after the pandemic to the office. Square reports a year-over-year increase in sales of workwear such as dress shirts, oversized blazers and dressy sneakers.

Conscious consumerism

The retail report also touches on sustainability, saying millennials and zoomers have spent 69% of their spending on eco-friendly products so far this year. It suggests that companies “create partnerships with sustainable brands by collaborating on give-back programs, marketing campaigns, and stocking their products.”

Insider intelligence advises business owners that to attract Zoomers and millennials, they should be “deliberate about running their businesses in an environmentally conscious way without being seen as performative.”

About the author

Rieva Lesonsky is CEO of GrowBiz Media and SmallBusinessCurrents.com and has been dealing with small businesses and entrepreneurship for over 30 years. Get a better understanding of business trends by signing up for her free currents newsletter.

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