Retailers: Don’t Forget About Gen Z This Holiday Season

Posted by: Jeff Fromm

Download the latest Gen Z research now

With Daylight Savings Time under our belt, we have officially entered the time of year so vital to retail and the economy: the holiday season. Black Friday and Cyber Monday are looming on the horizon, and brands are kicking it into high gear in hopes of garnering their fair share of revenue from the anticipated historic holiday spending set to take place. The National Retail Federation (NRF) estimates retail sales to rise to $656 billion and online sales to jump to $117 billion, up 3.6 and 10 percent from last year, respectively.

However, brands won’t quite reach their full potential if they focus only on Baby Boomers, Generation X, or even Millennials. A new group of consumers has entered the playing field, one with significant spending power and values aligned with the material marketplace, equating to a major opportunity in the retail space. This group is Generation Z.


According to a recent Gen Z study by my team at FutureCast and Barkley Ad Agency, this group has a $600 billion influence on family spending and a $44 billion yearly disposable allowance (that’s a pretty big deal when considering 80s and 90s kids’ meager allowances). While upholding the expectation passed down from Millennials that brands should be real, Gen Z is actually more concerned about presenting their image as unique on an individual level.

For them, image is everything and they want to cultivate the perfect one in whatever way possible. This means that this coming holiday season, we can expect to see teen’s interest in material good increase.

According to PwC, Gen Z intends to spend more than the Millennial generation on tactile items, such as clothes, shoes and accessories, with 58 percent of their budget going towards items in this category.

This is much different from the mindset of Millennials, who place a greater value on experiences than products. If they had their choice for the holidays, they’d be jetting off to Europe or watching their favorite artist perform live.

To avoid losing out on the opportunity that Gen Z represents, brands should leverage these following key insights from our Gen Z Study to find resonance:

Gen Z requires proof from brands

Like Millennials, Gen Z consumers expect brands to stand with the causes they believe in regarding human rights, race, sexual orientation and poverty. When brands do this, Gen Z will advocate for them. However, brands must be sure that they actually have the brand authority to insert themselves in the issues of today rather than doing it just for their bottom line. If they stand with causes for the wrong reasons, Gen Z will cast them aside.

Gen Z has different expectations for brands than for themselves

Unlike generations before them, Gen Z does not expect perfection in advertising and would rather brands reflect reality. If brands offer images that are realistic and achievable, this group will respond positively because they don’t buy into fake perceptions of beauty. And as Gen Z is all about crafting their own unique image, they will only rely on brands that are real – otherwise how could they be sure it was the right brand for them?

Gen Z uses social media intentionally

This generation has grown up in a world where their options are limitless but their time is not. As a result, they have adapted to quickly sorting through and assessing enormous amounts of information. They use their social media with a purpose to find some organization in their hectic virtual lives, meaning they utilize different platforms for different reasons. Brands should inspire Gen Z creativity on sites like Tumblr, Pinterest and Peach, offer updates and news on Twitter, and create a personal connection on visual platforms such as Instagram. By matching agendas with those of Gen Z consumers, brands will avoid being tuned out.

Even though the spending power of Gen Z is less in comparison to other generations, these consumers exhibit attitudes and beliefs that closely align with the retail category. It would be a mistake for organizations in the space to forgo the opportunity they present, especially as their power and influence is only set to grow (they will be 40 percent of the population by 2020). Brands should get ahead of the game now to reap the greatest benefits later.

To learn more about the Pivotal Generation and their impact on the market, download our latest research report Getting to Know Gen Z: How The Pivotal Generation is Different From Millennials.

Download the latest Gen Z research now

Want more on Gen Z? Stay tuned for Jeff Fromm & Angie Read’s new book, Marketing to Gen Z, coming Spring 2018. Pre-order here!

About Jeff Fromm

Although not a Millennial as defined by his age, Jeff Fromm is the Millennial Marketing Guy. Jeff is President of FutureCast, a marketing consultancy that specializes in Millennial trends, and is a contributing writer at...See Jeff's full bio.