By Kirby Britten
In the vast global economy of the e-commerce industry many sectors have been defined to what actually makes it thrive. But, perhaps no component is more important than where its core purchasing power comes from.
Millennials and Gen Z have uniquely demonstrated their purchasing presence on this mammoth industry in becoming the front-runners in revenue producing dollars and controlling the top buying trends.
But first let’s define these two awesome demographics. In October 2004, researchers Neil Howe and William Strauss called millennial those members of the population that were born from 1982 and twenty years thereafter. This generation grew up with the invention of the internet and the birth of email. Gen Z are our young people born after 2000 and the first generation to grow up with the emergence of social media and the App world.
But, according to Forbes in 2015 the generation born after millennials, Gen Z’ers are from the mid 90’s to early 2000’s.
Let’s not forget our elder and distinguished U.S. citizens, the iconic Baby Boomers. Our post war population born from 1946 to 1964, respectfully. Their the moms and dads of millennials and the grandparents of Gen Z.
Millennials cash in on the e-commerce boom!
It’s easier than ever for businesses to have a digital presence across a variety of channels, especially since the coming of age phenomenon of social media platforms. Millennials are now cashing in on the e-commerce business boom and becoming digital entrepreneurs, foregoing the routine office work schedule and daily rat race traffic commute.
In a 2017 point of sale solutions survey of 1,164 U.S. businesses owned by millennials, conducted by Square and Mercury Analytics found that…
- 56% have physical stores.
- 21% have a pop-up store or a pop-up vendor at special events.
- 34% sell through their own website using a website building platform.
- 25% sell through Facebook (40% on social media as a whole).
- 16% sell through Amazon (more should, considering almost half of the purchases begin here).
- 22% sell through other market places including Amazon, Wayfair, Shopify, and Ebay, among others.
Attitudes on Retail Shopping vs. Online
Millennials and Gen Z share some similarities when choosing to shop at retail stores verses online. In a October 2017 report by Price Waterhouse Coopers for its annual Holiday Outlook survey, 2,395 national consumers were surveyed and, separately, 301 Gen Z shoppers.
In the divide between the two demographics Millennials shared similar consumer trends with the video sensation YouTube generation. The survey defines Gen Z as those between 13 and 21 years of age, while those between the ages of 13 and 16 were considered “young Gen Z”.
In the study, a overwhelmly 81% of Gen Z respondents said they preferred to shop at retail stores, while 40% said they would only shop at stores. Malls continue to be the favorite shopping destination over outlet stores and avoiding the demanding pressures of downtown city shopping.
Sarah Talley, 36, and manager of a Starbucks Cafe in West Los Angeles considers both advantages, online and walking into a physical store when doing her shopping. “Going online is best when deciding between many different brands and models of a product. You can make a comparison right on the screen. But when I’m ready to buy, I prefer to walk in a store to see and touch the product.”
Talley’s shopping trend attitude is shared by many Gen Z consumers when deciding to visit malls than looking online, and usually with different motivations in mind.
Kendra Myers, 19, says shopping in stores is all about the “total experience”. “When I shop in mall stores or in Hollywood with my friends you get the full experience. Price comparison, trying on different outfits and styles, everything. Plus, on the spot discounted items is really cool”.
It makes sense to believe that Gen Z prefers to shop in stores because they often don’t have their own credit or debit cards, but make more online purchases using their phones or on social media sites than both Millennials and Baby Boomers.
In talking with both Millennials and Gen Z I learned that visiting walk – in stores hasn’t loss its greater appeal with either demographic. Both use online shopping to explore many different brands and styles of a product before committing to a purchase.
I learned that both demographics use online information to make them more savvy consumers for when they’re standing in front of the product.
Gen Z by the numbers
Maya Angelou once said, “If you think size doesn’t matter, try sleeping with a mosquito in the room.” That profound and funny understanding of the dominating influence of the little guys clearly explains Gen Z presence on the e-commerce landscape.
Check out these statistics for starters.
- Gen Z makes up 25% of the U.S. population and are a larger percentage of the population than Baby Boomers and quickly approaching Millennials levels.
- In a recent study conducted by IBM of 15,600 people in 16 countries Gen Z has $44 billion in purchasing power. They also influence an astounding 93% of the family budget.
- 25% of Gen Z’ers spend over 5 hours per day on a mobile device.
As we approach the first twenty year benchmark in the new millennium, economists and researchers alike will study the growth, trends, and impact of the e-commerce industry on the global economy.
One discovery has already been made. Except with the invention of the internet itself, perhaps no other trend, source, or force of consumer purchasing power has gripped or changed the future of e-commerce than the people belonging to the awesome groups of Millennials and Gen Z.