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Gen Z Consumers Represent $44B in Purchasing Power—and They’re Loyal to Brands That Impress

Brands have been tailoring both products and marketing initiatives to attract a younger generation of consumers, and that strategy may very well pay off.

According to e-commerce marketing platform Yotpo’s newly-released 2019 Fashion E-Commerce Report, millennial consumers are set to reach $1.4 trillion in purchasing power by 2020, while Gen Z is already at $44 billion annually.

Those figures represent enormous potential for savvy, proactive brands and retailers willing to invest in new methods for reaching the digital generation. Younger consumers shop differently from their Gen X and baby boomer counterparts, eschewing traditional retail channels for online and mobile shopping.

They’re also influenced by, well, influencers.

More than half (53.6 percent) of Yotpo’s survey respondents said their most recent fashion purchases were inspired by what they’d seen on social media. That number is striking in contrast with Boomers, only a quarter (27.5 percent) of whom admitted to using social media as a tool for discovering new fashion finds. Social strategy is an integral part of brand building and reaching the newest generations of consumers, and Yotpo’s research underscores why it can’t be ignored.

Once brands hit the right note with young consumers, though, they can reap lasting benefits. Most Gen Z and millennial consumers (69.3 percent) said they were loyal to particular brands after buying from them. That’s 10 percent higher than consumers ages 35 and up, 59.2 percent of whom said the same.

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Winning loyalty comes not just with great product, but with an optimal experience from browsing through fulfillment. According to Yotpo, Gen Z and millennial consumers want to be wowed when it comes to both product information and third-party validation. Nearly all of the respondents (98.9 percent) said product reviews were a very important factor in their path to purchase, and the vast majority (94.9 percent) considered photos from customers to be of the utmost importance.

Only 71.6 percent of young consumers said they considered detailed product information a vital part of their browsing and buying experience, suggesting they trust the opinions and reflections of their peers over brands.

Young consumers would also rather purchase from brands directly than from online retailers, like Amazon. In fact, 21 percent of surveyed Gen Z shoppers said they didn’t know—or didn’t care—about Amazon’s Prime Day, while 70 percent of respondents said they prefer direct-to-consumer experiences.

According to Yotpo, millennial and Gen Z consumers shopping online are looking for a “true destination that entices [them] to visit, stay, and return.” To woo them, brands must tailor shopping experiences “to their social-first mindset using customer content to keep them engaged.”