Generation Z characteristics: What businesses should know about the next wave of consumers

Published November 10, 2020

How are you connecting to the generation that will spend $143 billion this year in the U.S. alone?


Gen Z, the portion of the U.S. population born around 1996 through roughly 2010, makes up for 40 percent of the number of U.S. consumers and by 2026, Generation Z will surpass millennials as the largest consumer base in the U.S. So, brands need to get to know them.

For starters, Gen Z consumers are the most ethnically diverse generation and they’re on track to be the most educated in U.S. history, but they aren’t terribly trusting—they can sense insincerity a mile away. They value things in brands that they also value in their daily lives like authenticity, transparency, being unique, giving back to society and collaborating. Smart brands, above all, should find ways to nurture their relationships with this powerful and discerning new generation of consumers. 

What they’ll be looking for when they wield their spending power


This is the generation that, largely, grew up not remembering the September 11, 2001 terrorist attacks —so they don’t know what the world was like before that; they’ve seen a lot of world conflict and may have a better understanding of suffering in the world than previous generations. So, count on them researching your business before they shop to figure out what you’re all about. But that’s just one of many characteristics that set these consumers apart.  

They want you to show that you care—about the world.

Generation Z doesn’t want to be sold to—they want to be connected with and in a way that shows you support good in the world. A 2019 Porter Novelli/Cone study found “90 percent believe companies must act to help social and environmental issues,” and “75 percent will do research to see if a company is being honest when it takes a stand on issues.” 

To them, value reflects more than what’s on a price tag. They’re more likely to purchase a product or service that’s backed by social accountability. According to a study by Ad Age, 33 percent “have stopped buying from a company that contributes to a cause with which they disagree.” This leads them to support brands like Everlane, Package Free Shop and Patagonia—all companies that put sustainability at the forefront of their product and marketing. 

They shop social, sustainable and small.

Despite the fact that Gen Z has grown up on digital, that’s not their preferred way to shop, they like visiting your brick-and-mortar and they love to interact with brands in person. To Gen Z, brick-and-mortar businesses are not dead. Young consumers are known to shell out their cash for an experience rather than just a new product. As a money-conscious generation, experiences reach beyond expensive concerts and vacations. They want to enjoy experiences in everyday life.

According to a 2017 survey by Accenture, “77 percent of Gen Z respondents in the U.S. said that shopping at brick-and-mortar stores is their preferred channel.” In the same study, 46 percent of Gen Z consumers said they get their information in-store before making an online purchase. The data proves further that young shoppers want to spend time with brands in person, regardless of their penchant for favoring online interaction.

And, because they are socially minded, their support for small business is good news for brick-and-mortar owners—especially if you want to make a COVID-19 comeback. An April 2020 consumer survey showed 48 percent of respondents under 45 said they trust retailers with physical locations more since the beginning of quarantine. Gen Z consumers are loyal to brick-and-mortar businesses that are transparent about the safety measures they’re taking, like curbside pickup and taking contactless payments.

Gen Zers want to feel like they’re a part of a community that supports the causes they care about. For this reason, they love to shop small. Bigger brands can adapt to this mindset by “popping up,” giving their larger operation a smaller feel. Gen Z is also into supporting brands they can relate to. That’s why you’ll see more and more retailers—big and small—sharing stories through channels like blogging and via social media.

They support businesses that show authenticity.

According to CNBC, when it comes to Gen Z consumer sentiment, authenticity and relatability are key. Gen Z is on the hunt for the truth. They want relatability, all the way from the ads they see to the person behind the cash register. Not to mention, their hunger for authenticity compounds during times of social or political unrest. Gen Z consumers want to know the brands they support also support the causes they care about, and if they don’t, they have no problem taking their business elsewhere.

They use social media to research before they buy.

Social media permeates their buying habits. In the past year, 37 percent of Gen Zs “have increased their use of social media for purchase decision-making,” according to Accenture. Additionally, two out of three Gen Z shoppers want to make purchases directly through social media. Gen Zs tend to move through multiple touchpoints before making a purchase—doing online, social media and in-store research before taking the plunge. Some call it being picky—they call it being informed.

They love to eat out.

Restaurants can take advantage of Gen Z’s spending power before they even enter the workforce. Many of those belonging to Generation Z are still in college, and in that age group they  spend most of their disposable income on food. In fact, almost 70 percent of them eat out once a week. By adopting the digital technologies they feel comfortable with, restaurants can get ahead on planning the capture of this worthwhile consumer base.  

They want to foster financial wellness.

A study led by financial technology company Afterpay and The Future Laboratory proved Gen Z to be a financially proactive generation. They monitor their spending habits through apps and don’t use credit cards like previous generations do (although they way millennials credit cards also changed). According to the study, “94 percent of Afterpay’s Gen Z customers use their own money, linking their account to a debit card.”  There’s a current responsible spending trend in business as well. When making a purchase decision at work, Gen Zs are more likely to consult online ratings—then discuss it with peers—rather than going through a sales rep. Because of this, financial institutions can better engage with Gen Z customers by adopting more digital solutions.

Remember, they’re now the most digitally advanced generation


The oldest of the Gen Zers were born only eight years before Facebook launched, so their profile pictures span from grade school until they found their first job. The first iPhone was released in 2007, so constant engagement with all the social media platforms is simply what they know. And, while they prefer to shop in your store, digital-first shouldn’t be overlooked.  

That means you’ll want to:

  • Kick up your brand’s visibility across every social media platform and do it in a way that allows for the most engagement (Pandora understood that concept, see how they upped their users engagement)

  • Accept contactless payments (all the various types whether it’s Apple Pay, tap-to-pay cards or mobile payments from their banks like Zelle) 

  • Have a website that is easy to use and is intuitive—anything that seems outdated isn’t going to go over well with this generation 

  • Give them as many ways possible to interact with you digitally—make emails and texting part of your regular marketing campaigns, they want to hear that ping

Emphasize your authenticity and truly connect with them


Generation Z is quickly becoming the most powerful consumer group in the world. If you haven’t started to bridge the gap between your millennial-driven strategies and those that appeal more to Gen Z, you’re at risk of lagging behind. Businesses who understand Gen Zers, what they value and how to interact with them will be the ones to win over their business. But the keys will also be nurturing relationships and being authentic, which for them is the new “transparent.”