1、1 2 Gen Z,or as its spending habits and patterns will show Spend Z,is the generation to track today and for years to come.Almost 25%of the population,Gen Zers are a global force set to bring the most money to the consumer spending class by 2030.If youre going to grow with Gen Z,youre going to need a

2、 full view of whats now and whats next.3 05 Introduction Spend Z:Gen Z Changes Everything 07 Gen Z Decoded The Weight of Gen Z What Else Makes Gen Z Unique?What Values Matter Most to Gen Z?HowGenZsRealitiesandPerceptionsInfluencePurchase13 Gen Z Spending Priorities Near-Term Snapshot(0-2 Years)What

3、is Gen Z buying?Whats fueling Gen Z purchase behaviors?Mid-Term Outlook(2-10 Years)New life stages and their impact Must-have products for Gen Z Long-Term Perspectives(10+Years)26 Five Strategic Considerations GenZInfluenceonPrivateLabelGrowth GenZersSphereofInfluenceonHouseholdPurchases Gen Z Purch

4、ase Patterns vs.Other Generations Must-Leverage Marketing Channels Securing Lifelong Brand Loyalty32 The Big Takeaway for Brands and RetailersTable of ContentsClick on the contents to navigate 4 Thank you for the opportunity to share Spend Z:A Global Report with you.We know that,like Gen Z,your atte

5、ntion is pulled in multiple directions.Were confident that this first-of-its kind report,a collaborative effort between NielsenIQ,GfK,and World Data Lab(WDL),will be well worth your time.While you might think you know Gen Z or as its spending habits will show,“Spend Z”our comprehensive analysis reve

6、als that theres much to learn about this growing consumer cohort.With their spending power projected to grow to an estimated$12T by 2030,Gen Z will have a significant influence on the products manufacturers and retailers sell in the near future,while emerging as a critical and largely untapped lever

7、 of growth.Spend Z is tailored to assist retailers and manufacturers in the consumer-packaged goods(CPG)and tech and durables(T&D)industries in nurturing and maintaining loyalty among Gen Z consumers worldwide.From deciphering their digital behaviors to their revealing values and purchasing habits,S

8、pend Z provides a comprehensive toolkit for forging meaningful connections with this influential demographic.We believe that tapping into Gen Zs spending potential today will put your brands on a trajectory for future success.Our teams are passionate about this Gen Z study and welcome any questions

9、you may have regarding the research or how to strategically engage with Gen Z.Together,lets uncover the insights that will propel your business forward in the era of“Spend Z.”A W E LCO M E N OTE F RO M:Marta Cyhan BowlesWolfgang FenglerMarta Cyhan BowlesChief Communications Officer and Global Head o

10、f Marketing COE,NielsenIQWolfgang FenglerCo-Founder&CEO,World Data Lab5 For decades,retailers and manufacturers alike have analyzed generational spending to uncover key insights into what(and how)consumers around the world purchase.Every generation is comprised of unique attributes and shared values

11、,which,over time,translate into generational spending patterns that differ from prior generations.The study of these spending patterns assists organizations in pulling in new cohorts of customers while making proper downstream investments to build early loyalty loyalty that could help sustain revenu

12、e today,tomorrow,and long into the future.While generational spending patterns are a cited top priority for organizations,the vast majority of both retailers and manufacturers remain focused on capturing todays dollar.This study,a collaboration between NIQ,GfK and World Data Lab,will examine how to“

13、unlock”future spending from what will be the largest and wealthiest generation in history:Gen Z.Further,this study should serve as a guide to help retailers and manufacturers in the consumer-packaged goods(CPG)and tech and durables(T&D)spaces build interest,foster engagement,and maintain loyalty fro

14、m Gen Z by tapping into the spending potential of this highly nuanced generation a spending potential forecasted to reach$12 trillion USD by 2030.Spend Z:Gen Z Changes Everything Introduction To accomplish this task,C-suite executives(and their strategists)must be equipped with industry-leading,acti

15、onable data and insights that will grant them the confidence that their down-market investments in Gen Z(and other maturing generations)will result in sustained,incremental future revenue;notably,without sacrificing todays revenue opportunities.Enter NIQ.6 Its the largest generation to date and will

16、 likely be the largest ever It will be the wealthiest generation ever It will have the fastest growth in spending power It will overtake Boomer spend by 2029Why You Should Focus on Gen Z:Those who want to capture Gen Z spend tomorrow must invest today.Gen Z is roughly defined as anyone born between

17、1997 and 2012(currently aged 1227).The generation born after Millennials and before Gen Alpha,youve likely heard Gen Zs members described as obsessed with their phones,broke,and never leaving home,to name just a few common preconceived notions.The data tells a far more complex story,however one that

18、 will dispel some myths and affirm some truths about this trending generation.As an ever-increasing number of Gen Zers make their way into the consumer class,1 this generation will play a critical role in the products manufacturers and retailers sell.Indeed,in the next decade,per capita Gen Z spend

19、will grow at a CAGR of 4.02 percent at exactly twice the speed of previous generations.1 Consumer class is defined as anybody spending over$12/day in 2017$PPP To unlock spending from Gen Z,its critical that we ground ourselves in who they are,where theyre focused,what motivates them,their size today

20、,and their size tomorrow.Meet 7 Exhibit 1Gen Z is the largest generation that will ever exist Gen Z is influencing household purchases at a disproportionate rate compared with previous generations,which translates to significant spending power.The economy is worrying members of Gen Z,and value is pa

21、ramount when attempting to influence them to make purchasing decisions.There are“Say-Do”consumption gaps between what Gen Zers claim they want and what they actually purchase.Read on to further explore these attributes.Gen Z At-a-Glance Gen Z will be the largest,wealthiest,and highest spending gener

22、ational cohort in history.World Data Lab research shows that Gen Z is the largest generation in history and will likely be the only generation ever to reach 2 billion people,or roughly a quarter of the total global population(Exhibit 1).This statistic alone proves that this demographic is a force to

23、 be reckoned with.Source:World Data Lab,Generations ForecastsGen Z Decoded The Largest Generation Ever:2 Billion Gen Zersof the worlds population25%Born 1997-2012The Weight of Gen Z Gen Z is also unprecedentedly wealthy.The average American 25-year-old Gen Zer has an annual household income of over$

24、40,000,rendering them“better off”than Millennials were at the same age,and placing their income at+50%above Baby Boomer income when Boomers were 25 years of age.43 Exhibit 2But income doesnt equate to spending.So,what about global Gen Z spend?To get an accurate gauge on current Gen Z spending power,

25、we leveraged Purchase Power Parity(in constant 2017 international dollars)to compare prior generations spend at the same life stage of current-day Gen Zers.This allows us to standardize to 2017 prices,using an average consumer“basket”of goods to account for inflation.The result?Accurate comparabilit

26、y across countries,trended over time providing precise economic forecasts and eliminating distortions from inflation and currency fluctuations.Following this analysis,Gen Z also emerges“richer”than generations that preceded it at the same life stage.When you couple this with the income advantages pr

27、eviously discussed,theres no question:Gen Z is the wealthiest generation to date.Today,Gen Z accounts for approximately 17.1%of the total global spend of$57.6 trillion USD.By 2030,that number will grow to 18.7%.Total global spend is also projected to increase by 2030 to$67.2 trillion USD.to$12.6 tri

28、llion USD by 2030.Total Gen Z spending will explode from$9.8 trillion USDtoday.2030Today2034By 2034,Gen Z will add almost$9 trillion USD in spending globally,more than any other generation.Exhibit 3Gen Z is the generation growing the mostSource:World Data Lab,Generations ForecastsGenerational popula

29、tion,spending and consumption Global 2024 and 2030Source:World Data Lab,Generations Forecasts9 What Else Makes Gen Z Unique?Largest generation ever Fastest growing spend First truly digital natives Most globally influential Racially,ethnically diverse Majority non-WesternGen Z is digital first,highl

30、y“non-Western,”and spans various life stages;in other words,this demographic is anything but a monolith.Gen Z has never known a life without immediate,open access to information through technology,which makes it the first truly“digitally native”consumer cohort.This also makes it arguably the most gl

31、obally influential generational cohort of all time.And,as we will explore later,that influence directly shapes the consumption behaviors of other generations.Gen Z is currently straddling childhood and adulthood,so those at the top end are in their twenties and might be buying their first home or ha

32、ving their first child,while the youngest members are just finishing elementary school.Understanding where Gen Z is currently positioned,from a life stage perspective,surfaces as critical because generations dont dictate spending,per se.Rather,life stage dictates spending for different cohorts withi

33、n a generation.So why not focus solely on life stages over generations Gen Z or otherwise?Well,as consumers age within their generation,they move through the various life stages that dictate spend,but their consumer behaviors and preferences still broadly align to their generations core beliefs,aspi

34、rations,and lifestyles.Studying and understanding Gen Zs preferences equips us with the foresight essential to delivering the products and services this ever-evolving generation will demand as its members advance though their life stages.Exhibit 4Comparison of generational vs.age group spending(2000

35、-2050)Though Gen Z will have the fastest growing spend(when compared to other generations),people aged 60+will comprise the largest share of world spending.Source:World Data Lab,Generations Forecasts10 Authenticity is a top value for Gen Z.5 This is highlighted when we examine Gen Zs idea of celebri

36、ty which has shifted from past generations,such that they are more interested in authentic relationships with social media influencers and brands rather than traditional Hollywood celebrities.In fact,“Being true to yourself”is the number one ranked description of success for Gen Z globally.6 Relatio

37、nships also manifest differently for Gen Zers.Their digital connectedness lends itself to virtual engagement,sometimes at the cost of in-person relationships.This has led to increased rates of isolation/loneliness and the deprioritization of values like enduring love,romance,and sex.7 Because of thi

38、s,belonging and self-esteem have also emerged as top values Gen Z prioritizes when seeking products from both manufacturers and retailers.The weight of Gen Zers concerns about the economy,climate change,and other global issues(combined with the far-reaching impact of social media)has resulted in a r

39、eported strong sense of identity thats highly linked to social causes and has left Gen Z to grapple with a profound sense of pessimism.This advocacy doesnt always find its way into the generations spend,however.What Values Matter Most to Gen Z?How Gen Zs Realities and Perceptions Influence PurchaseE

40、merging markets play a disproportionate role among Gen Z consumers.Only 10 percent of Gen Zers are from North America or Europe(Exhibit 5),and only 44 percent of Gen Zs total spending comes from Western countries(North America and the EU),making it the first generation ever to have less than half of

41、 its spend coming from Western nations.Exhibit 5 Source:World Data Lab,Generations ForecastsGen Z is the least Western generationThe diversity of Gen Zers also comes through in their social and cultural values.Compared to Millennials,2 7.7 percent more Gen Zers identify with the LGBTQ+community,3 an

42、d in some countries,like the U.S.,they are less likely to affiliate with established religions.411 For instance,Gen Zers report being concerned about the climate and environmental justice(with 77 percent of Gen Zers saying they wont buy from countries with poor environmental standards),but their out

43、sized consumption of fast fashion and the latest tech gadgets are at odds with these stated priorities8 thus revealing a clear“Say-Do”consumption gap.More on this gap in a moment.When it comes to Gen Zs perception of the economy,Gen Z has the“least positive outlook.of any generation,”according to a

44、survey by McKinsey.9 The global economy has been tenuous,and Gen Zs outlook reflects this.Four of the top five concerns for Gen Z in 2023 were economic.10 These fears are undoubtedly influenced by the COVID-19 pandemic as many Gen Zers had someone in their household lose a job or take a pay cut.11 W

45、hat insights emerge when we overlay the macroeconomic influences on Gen Z with Gen Zs reported priorities and actual spending habits?Phrased differently:How can we bridge the“Say-Do”gap to win future Gen Z spend?As we mentioned,Gen Z has a heightened awareness of“value,”and value is relative for eve

46、ry generation.Thus,the goal for retailers and manufacturers is to increase the perception of value for the products you sell.How do you accomplish this task?In our 2024 Global Consumer Outlook Report,we asked consumers(of all generations)what matters most to them when it comes to their purchasing ha

47、bits.Unsurprisingly,affordability ranked first.However,keeping in mind that value is relative,we know this is not the full story.Product attributes become paramount to increasing this perception of value with consumers.A single product attribute and/or claim that is“stacked”with claims perceived as

48、highly valuable to consumers(e.g.,hygiene,safety,and health-related claims)can raise consumers perception of value more than attempts to win on a single attribute in isolation.Thus the“stacking”of these attributes can provide a key advantage when attempting to bridge the“Say-Do”gap for Gen Zers.To u

49、nderscore this point,products with multiple(two or more)sustainability attributes saw a 2.5 times higher sales lift than products that carried only a single sustainability claim.What is perhaps even more compelling for organizations looking to gain incrementality with Gen Zers is that the least comm

50、only reported priorities relative to product attribute claims(e.g.,“carbon zero”)saw the fastest growth when“stacked”with at least one additional claim.Say:Do:buy fast fashion and the latest tech gadgets.77%of Gen Zers say they wont buy from countries with poor environmental standards.“Say-Do”consum

51、ption gap:Carbon Zero Recycled MaterialsStacking claims and/or attributes(two or more)increases the perception of value to consumers a key advantage with Gen Zers.Bridging the Say-Do gap:12 When we layer this broader generational consumption data with what we know about Gen Zs spending priorities(fo

52、r example,we know that“they prefer to buy sustainable brands,and theyre willing to spend 10 percent more on sustainable products”),we get a truly exciting opportunity for brands and retailers looking to grow revenue in the short-,mid-,and long-term.Keep in mind that winning attributes will vary grea

53、tly across geographies and socio-economic cohorts within the global Gen Z population;language differences,lifestyles,cultural norms and preferences all shape value perceptions and have great potential to impact the reception of your product or brand.There is no one-size-fits-all approach to driving

54、value.However,to win future Gen Z dollars,you need to start investing in data that will drive innovation and set the stage for you to build the attribute stacks that will inspire future Gen Z spend.Key executive takeawayInvest in data that reveals the attributes Gen Zers are actually gravitating tow

55、ard(e.g.,cruelty free,sustainable,etc.).Be cautious,however,that you arent simply investing(or over-investing)in attributes Gen Zers merely claim they are prioritizing.What they report and how they spend do not always align.Exhibit 6U.S.CPG sales growth vs.a year agoSource:NIQ Retail Measurement Ser

56、vices,NIQ Product Insight,powered by Label Insight,Total US xAOC;52 weeks ended Feb.24,2024 vs.a year ago Gen Zers prefer to buy sustainable brands,and theyre willing to spend 10%more on sustainable products.13 While Gen Z currently makes up one quarter of the global population,its spending in 2024

57、only accounted for 17.1 percent of total spend.12 However,global trends dont translate to each region as vast differences exist in the generational compositions of countries.Gen Z currently has a more significant share of spend in Sub-Saharan Africa and countries like India,where it makes up a more

58、substantial portion of the population(Exhibit 7).In both the near and mid-term,Europe and North America will continue to skew older relative to spend.Near-Term Snapshot(0-2 Years):What(and How)Is Gen Z Buying Today?As with every other generation,Gen Zs spending priorities will continue to evolve ove

59、r time.Manufacturers and retailers need to understand what is important to Gen Z today,as well as forecast what will matter to them in the future.Product and innovation pipelines depend upon accurate data forecasts to anticipate generational needs,so lets look at what the research reveals about the

60、Gen Z opportunity today,in the mid-term,and for decades to come.So how many global dollars are on the table for retailers and manufacturers when it comes to Gen Z spending in 2024?$9.8 trillion USD.13Exhibit 7 Consumer class spending total:2024Source:World Data Lab,Generations ForecastsGen Z Spendin

61、g Priorities 14 Before we explore which categories Gen Z is most frequently buying today,we should note that“down-market”investment is critical for organizations looking to woo Gen Z in the mid-and long-term.If done correctly,retailers and brands can gain incrementality on the$9.8 trillion dollar sp

62、end of today,while investing in the explosive spending growth of Gen Z tomorrow.Exhibit 8 Rank*of attitudes by generationsSource:GfK Consumer Life Global 2023,E1/J1/M1(global=18 countries):*based on a list of 43 attitudinal statements.Gen Z.more prone to brand exploration and they look for novelty a

63、nd fun in everyday products.Ongoing engagement strategies should include both incremental and disruptive innovation for product“freshness”and playful yet authentic advertising campaigns that speak directly to Gen Z.Remember Gen Zs values:value,quality,and authenticity.Key executive takeaway15 Today,

64、most Gen Zers begin their shopping journey online,14 highlighting just how important digital channels are for marketers looking to court their spend.Social media is a shopping destination for Gen Zers,with 53 percent saying theyve used“buy”buttons on social media networks.15 Indeed,Gen Z ranks onlin

65、e reviews from other shoppers as the most important factor when shopping,16 with many of those reviews published directly on social media via influencer and peer posts.One interesting insight is that although Gen Z consumers begin their shopping journey online and are heavily influenced by social me

66、dia,their share of mass merch(in-store)dollars is higher than every other generation before them.17 Together,their in-store mass merch and grocery purchases make up almost 50 percent of their share of dollars,proving that brick-and-mortar shopping remains vital,and that Gen Z will be the purest“omni

67、”shopping generation to date.In-store mass merch and grocery make up50%of dollar share53%Theres never been a generation more worthy of omni-channel investment(and garnering the correct data to fuel your omni strategy)than Gen Z.Theyre digital,theyre in-store,theyre looking to social commerce,and the

68、yre direct-to-consumer.Theyre also informed and influential.You need to be everywhere to fully unlock Gen Z spend,and that means your spend has never had to work harder.Key executive takeawayof Gen Zers say they have used“buy”buttons on social media networks1516 To understand how Gen Z is purchasing

69、 today(particularly as it relates to other generations),we should start with what the average“world”consumer is spending in 2024 at a category level,irrespective of generation.This begs the question:How does Gen Z compare to the average“world”consumers spend?What is Gen Z buying?A“world”consumer spe

70、nds$13.8k USD per year Yearly per capita global spending in 2024 disaggregated into spending categories for the consumer classSource:World Data LabExhibit 9 17 Other health and nutrition categories also matter a great deal to Gen Z,having a large impact on both T&D and CPG.T&D manufacturers and reta

71、ilers should take note that over half of Gen Z has used a fitness or exercise app,and 17 percent have used a fitness band to track health and fitness information.20 Despite their youth,members of Gen Z rank“good health”as number one among the definitions of the“Good Life”and recognize that natural i

72、ngredients are healthier.Exhibit 10 Beauty-Social Media Purchasing by GenerationSource:NIQ US Gen Z survey,Aug 2022,Q14 For the purposes of illustration,well highlight U.S.-specific categories where Gen Z is over-indexing.In the T&D space,Gen Z is spending more on electronics than on household appli

73、ances.18 Headphones/headsets and mobile computing are their most purchased categories,with a spend comparable to Millennials and Gen X.On social media,health and beauty is the most popular category for Gen Z.This year,81 percent of TikTok dollar sales are expected to come from health and beauty,soli

74、dfying it as a key Gen Z category for both brands and retailers.19 Below is an example of social medias outsized impact on Gen Z purchase decisions for beauty products compared to previous generations(Exhibit 10).of Gen Zers have used a fitness or exercise app,and.50+%17%have used a fitness band to

75、track health&fitness information2018 Exhibit 11Purchase Drivers by GenerationSource:NIQ US Gen Z survey,Aug 2022,Q9Whats fueling Gen Z purchase behaviors?As mentioned,“the environment”matters to Gen Z,with sustainability falling under that banner.However,price and quality are more influential driver

76、s of Gen Zs actual purchase decisions,as seen in our survey below on food purchase drivers(Exhibit 11).Their age and economic concerns are likely influencing the need for sale and“lowest price”products today,but as their economic outlook strengthens and more of Gen Z enters the workforce,these drive

77、rs will likely continue to evolve making relevant product attributes increasingly important.19 Exhibit 12Gen Z is the fastest growing generation and will spend at unprecedented rates.Source:World Data Lab ForecastsCPG and T&D manufacturers and retailers need to know which regions Gen Z will dominate

78、 by 2030 so they can adjust their innovation and marketing plans to cater to Gen Z spending potential appropriately.Key executive takeawayMid-Term Outlook(210 Years):What(and How)Will Gen Z Purchase in the Near Future?By 2030,Gen Z will account for 23.2 percent of the global population.21 That equat

79、es to 1.6 billion consumers spending an estimated$12 trillion dollars.Over the next six years,the per capita expenditure of Gen Z will grow the fastest(Exhibit 12).When they reach age 25,their mean and median spending per capita in the U.S.will outpace prior generations.22 In addition,by 2030,Gen Z

80、will contribute more wealthy people than Millennials to every region in the world dispelling the often-asserted myth of Gen Z being the“most broke generation ever.”23 By 2030,Gen Z will account for 1.6 billion consumers spending an estimated$12 trillion dollars.21Myth:“.most broke generation ever”23

81、And Gen Z will become the highest consumer spending class in many regions in 2030.20 Tipping pointsFor simplicity,lets refer to Gen Z dominance in consumption(relative to other generations),by region,as“tipping points”.*To help organizations better understand how to make the adjustments in innovatio

82、n and marketing plans(by region)as recommended above,we partnered with World Data Lab to forecast each major regions Gen Z“tipping point”.For further clarity,relative to Gen Z consumption,weve specifically highlighted when Gen Z will overtake Boomer consumption for each prioritized region.Of note:Du

83、e to the relatively high fertility rates in developing economies(and relatively low consumption allocated to adults),several regions have already reached their Gen Z/Boomer“tipping point”,as a higher percentage of generational consumption is allocated to the young.Source:World Data Lab,Generations F

84、orecasts*Where consumption equals dollar spend benefitting members of the Gen Z cohort(irrespective of the generation spending).Exhibit 13Sub-Saharan Africa Gen Z Tipping Point Consumption by Generation in Sub-Saharan AfricaMiddle East&North Africa Gen Z Tipping Point Consumption by Generation in Mi

85、ddle East&North AfricaLATAM&CaribbeanGen Z Tipping Point Consumption by Generation in LatAm&Caribbean20202004042020200820182004Consumption($Nominal)Consumption($Nominal)Consumption($Nominal)Regional Gen Z“tipping points”21 Source:World Data Lab,Generations ForecastsGlobal Gen Z“tipping points”Exhibi

86、t 1408APACGen Z Tipping Point North AmericaGen Z Tipping Point Consumption by Generation in APACConsumption by Generation in North AmericaEuropeGen Z Tipping Point Consumption by Generation in Europe203420372022Consumption($Nominal)Consumption($Nominal)Consumption($Nominal)22 The impact of new life

87、stages on spending As Gen Zs spending power increases,its members will move into and through new life stages.Ten years from now,the youngest members of Gen Z will be in their twenties.Historically,this is a time of firsts marriage,buying a home,and raising children.However,as we saw with many Millen

88、nials who delayed marriage for careers,Gen Zs twenties may be very different than they were for Gen X or Boomers.Gen Z is the first generation to have grown up in the“gig economy.”As they enter the workforce,they are more likely than average to be employed in the informal economy(not taxed or monito

89、red by the government)or to work freelance.Today,about half of Gen Z has a job and the number of full-time Gen Zers in the workforce is about to surpass full-time Boomers.24 By 2030,Gen Z will make up 30 percent of the global workforce.25 Yet,in the U.S.,members of Gen Z are much less concerned with

90、 buying a home and having children.26 Their top aspirations in life include earning substantial sums of money,having a fulfilling career,and global and domestic travel.Manufacturers and retailers should consider these goals when planning targeted products and marketing campaigns in the mid-term.Anot

91、her helpful way to anticipate Gen Z spending over the next 10 years is to look at its share of spending growth,worldwide,across categories(Exhibit 16).Its not surprising that education and transport resonate across the board,as many Gen Zers are expected to complete higher education degrees during t

92、his time and buy their own cars or utilize public transport.Exhibit 15 2030 in terms of highest consumer class spendingSource:World Data Lab,Generations Forecasts Gen Zers willmake up 30%of the global workforce25Youngest Gen Zers12+years old2030Today2029Gen Z will overtakeBoomer spending23 But when

93、we look at product category-specific growth,our data predicts that through 2034,the most dynamic demand growth among the Gen Z consumer class will be in the alcohol and health categories.27 When examining this data,be careful not to conflate“healthcare”and“health-conscious”spending.As expected,healt

94、hcare spending is low for Gen Z as they are currently relatively young.When it comes to the health-conscious and sustainability-minded value system of Gen Z,we see no signs of slowdown in either the mid-or long-term,reinforcing our previous statement that it is a key growth area for manufacturers an

95、d retailers.Even at their relatively young ages,52 percent of Gen Z consumers already seek out nutrients and ingredients that keep them healthy,and 42 percent desire ingredients that are natural,not artificial.And 40 percent want products that are eco-friendly and sustainable.28 With that data in mi

96、nd,its no surprise that when purchasing beauty products,Gen Z is most looking for products that are clean,have natural fragrances,and are cruelty free.29 About 1 in 4 Gen Z members say that animal-friendly manufacturing influences their purchasing decisions.30 These purchase sentiments are consisten

97、t in the food space,where Gen Z favors products that are free from artificial ingredients,low in sugar,natural,and high in protein.Investing in health and wellness-related attributes for Gen Z-targeted product innovation will continue to pay off for manufacturers and retailers looking to attract thi

98、s cohort.Look to wellness-related attributes that are resonating outside of your product category to help inform new product innovation(or reformulations)in your category to quickly outpace your competition.Key executive takeawayGen Zers say animal-friendly manufacturinginfluences theirpurchasingdec

99、isions.in1 4lCExhibit 16Share of spending growth 2024/34-Gen Z24 Interested in learning about how Gen Z will contribute to your categorys global growth over the mid-term?Get in touch with us today.Must-have products for Gen Z If we dig deeper,several product categories stand out for Gen Z growth ove

100、r the mid-term(Exhibit 17).For example,Gen Z will shift more of their dollars toward products like facial skincare and probiotics as they move into adulthood.In addition,those who become parents will increase their spending on fruit snacks and yogurt.By the numbers,fruit snacks will experience a tot

101、al 1.1 percent compound annual growth rate(CAGR)over the next 10 years,but Gen Z specifically will see a 25 percent CAGR for the category.31 With Gen Z prioritizing health and the environment,we also expect NIQ Better For (a classification leveraging our proprietary algorithm to identify brands thro

102、ugh product characteristics,positioning,sales,and distribution)products to continue to grow faster than conventional products.32 This category includes products that are“better for”the consumer,the environment,and society.Currently,small brands and younger generations drive 62 percent of the growth

103、in this category(Exhibit 18).Exhibit 17Exhibit 18Younger consumers driving growth;suggesting long-term growth potential for Better ForTM brandsSource:NIQ Homescan Panel;Total US Panel;All Outlets;Total Food&Beverage;NIQ Better For Segment;$/Buyer%change vs.a year ago,$/Buyer Index to Total Panel;52

104、weeks ending January 27,2024Source:NIQ/World Data Lab,Generations Analysis,U.S.Spend by Generations25 Long-Term Perspectives(10+Years):What(and How)Will Gen Z Purchase As They Mature?As the largest generation in history,Gen Zers will have an outsized impact on the global economy.They may not yet be

105、the biggest spenders,but manufacturers and retailers that want to capture growth will need to secure future spend from this generation.Over time,Gen Z spending will more closely mirror that of Millennials.However,driven by the economic realities that have shaped them,members of this generation will

106、likely be more discerning and value-focused shoppers surfacing clear nuances between Gen Z and the generations that came before it.For example,while Gen Z doesnt use as many traditional coupons as older generations,33 brands that invest in digital circulars,loyalty apps,and digital promotions today

107、can satisfy Gen Zers now while helping to foster brand loyalty that will likely pay off tomorrow and long into the future.And while predictive data for long-term Gen Z spend is limited,we do know that when members of Gen Z hit 50+years old,their mean spending per capita(across all regions of the glo

108、be)will be higher than all previous generations.34 For example,in North America,the mean spending adjusted for inflation will be almost$8,000 more than for Millennials at age 50.Another way to view generational spending changes this far into the future is by examining age in tandem with generational

109、 spend(Exhibit 19).Keep in mind that people move into and out of age groups but their generation remains static.Exhibit 19Comparison of generational vs.age group spending in the U.S.(2000-2050)Source:World Data Lab,Generations ForecastsGen Z will overtake Boomer spending by year 2029.26 Five Strateg

110、ic Considerations 1.Gen Z Influence on Private Label Growth Our macro view of Gen Z today,tomorrow,and into the future outlined key recommendations about how to garner its members spend.But what other specific considerations and tactics can help retailers and manufacturers gain incremental spend fro

111、m Gen Z?We believe that an understanding of the following five“pillars”will inspire sound strategies for capturing Gen Z spend for years to come:private label,influence,purchase behaviors,marketing channels,and brand loyalty.Gen Z consumers,and their Millennial counterparts,are increasingly shopping

112、 private label.This is equal parts a function of private label being priced highly competitively and Gen Zs perception of private labels as a direct substitute for national brands.As mentioned,quality is a critical variable for Gen Z when assessing products and brands.The good news for retailers?An

113、astounding 67 percent of Gen Z feels private label products are just as good as national brands35 surfacing the Gen Z vantage point of private label as true competitors to national brands.As more and more retailers offer creative and premium private label experiences that are perceived as high value

114、,these products will serve as the foundation for a brand story that continues to resonate with this generation.Retailers should take note that private label growth currently exceeds national,branded product growth across both online and in-store channels.36 From 2021 to 2023,weve already seen a 10 p

115、ercent CAGR for omni sales of private label products.37 Markets in Europe already have a high penetration of private label products,so they wont see as high of a CAGR as the U.S.,where we expect to see private label grow 2530 percent over the next 10 years.However,those markets with more mature priv

116、ate label offerings like Switzerland and the U.K.still stand to benefit immensely as Gen Z ages into its true spending power in the mid-to long-term.Because many Gen Zers still live with their parents in 2024,it is essential to look at their influence on household purchases notably where they may no

117、t be the ones directly purchasing.To do so,we compared the purchasing of U.S.households with at least one Gen Zer to households with no Gen Zers.In food categories,we found households with Gen Z kids over-index across aisles on combo packs and variety packs.38 We see similar trends for health and be

118、auty with 2-in-1 or combination packs over-indexing along with several categories of facial,nail,and hair care.Also high on the list are sexual health products like condoms,emergency contraceptives,tampons,and pregnancy tests.Households with Gen Z kids over-index on combo and variety packs.2.Gen Zer

119、s Sphere of Influence on Household Purchases of Gen Z feels private label products are just as good asnational brands.3567%27 Exhibit 20Percentage of demographic willing to explore new brands in search of variety.This analysis showcases that not only is Gen Z buying today,theyre influencing how othe

120、r generations are buying today reinforcing how critical it is to start investing in Gen Z immediately.Gen Zs sphere of influence extends beyond the household to peer circles.After all,its members have a megaphone called social media at their fingertips,where theyre accustomed to sharing views and mo

121、bilizing action.Knowing that the“opinions of friends”ranks in the top five most important factors influencing their purchase decisions,brands must have strategies in place to leverage Gen Zs peer influence.3.Purchase Patterns of Gen Z vs.Other Generations While its helpful to see what moves the need

122、le for Gen Z,its never wise to do so in a vacuum.CPG and T&D brands can better understand key differences in purchase drivers,baskets,and frequency by comparing Gen Z spend to the spend of other generations.Today,over 50 percent of each generation prefers an omni approach and are likely to shop acro

123、ss stores and platforms to get the best balance of prices,deals,and options.39 However,theres greater discrepancy between generations when it comes to brand exploration(Exhibit 20)and celebrity influence.Millennials and Gen Zers are much more likely to be influenced by an expert or celebrity(with th

124、e exception of China where Boomers are equally influenced to purchase).Source:NIQ Consumer Outlook 2024,Globalvs.28 There are often more significant differences among the generations when it comes to baskets,however.First,take a look at an example of each generations basket for U.S.consumers across

125、generations.Now,lets look at the same comparison for UK consumers(Exhibit 22).While some categories vary by country,each generation has common themes.For example,Gen Z in both regions over-indexes on beauty,while Boomers prioritize health and wellness.Exhibit 21U.S.ExampleSource:US Consumer panel MA

126、T ending January 2024|Category level IIIExhibit 22U.K.ExampleSource:Fox Intelligence data FMG(Calibrated E-commerce)|MAT ending October 2023|Category level III29 Another important comparison is purchasing frequency,which can help manufacturers and retailers understand consumer habits,measure loyalty

127、,and learn what products bring customers back to the store.Of course,consumables,like groceries,will always have a higher purchase frequency than T&D products like smartphones.When we place a generational lens on this analysis,however,we can see how Gen Z compares to other generations in terms of pu

128、rchase frequency.Our European Union(E.U.)survey shows a lower purchase frequency for Gen Z across countries(Exhibit 23).This data aligns with our expectations as many Gen Zers are currently living at home and going to school versus being in the workforce with a steady income.Naturally,we expect to s

129、ee purchase frequency increase as Gen Z ages to mirror more closely the purchasing frequency exhibited by Gen Xers and Millennials.Exhibit 23Purchase Frequency by CountrySource:Fox Intelligence data FMCG latest 12 months ending 3/31/2430 Exhibit 24Penetration by age range in 2023:Total food and beve

130、rages In number of e-shoppers Source:Foxintelligence data FMCG(calibrated E-commerce),France,2023How generations shop is also changing with the rise of retail media networks,like Instacart and Amazon Prime.Retailers are already rolling out drone delivery options to satisfy impatient consumers.Much o

131、f Gen Z has grown up expecting instant gratification,so one would anticipate high adoption of these new shopping methods.Just how much are these changes influencing Gen Z compared with older generations?Below is an example from France(Exhibit 24).As expected,Gen Z is quick to adopt the nearly instan

132、taneous delivery that comes with quick commerce.,Brands should continue down-market,Gen Z-focused investments in advertising that supports retail media network adoption(and loyalty).While important,Return on Ad Spend(ROAS)may not be considered the best measure of success when evaluating performance

133、of retail media network advertising,but rather new and returning customers to the platform.Invest in awareness campaigns for early adoption by Gen Z for quick commerce platforms,like Gorillas in,the U.K.Key executive takeaway31 There are distinct differences in influence generated from marketing cha

134、nnels for each generation.For Gen Z,the digital sources that most often help them decide what food products to buy are apps(retailer,manufacturer,or money-saving apps)and social media.40 For example,when deciding where to shop for beauty products and alcohol,websites top the list,quickly followed by

135、 apps and social media.In this context,“websites”include everything from retailer and manufacturer websites to product review sites,money-saving sites,blogs,and online advertisements.This means prioritizing a brands website and advertising campaigns,along with other blog,influencer,and product revie

136、w efforts,is critical for reaching Gen Z.Email vs.text message effectiveness can vary by product for Gen Z.When influencing where to shop for beauty products,email is more effective than texts,but its the opposite when influencing purchase of alcoholic beverages for Gen Z.41 Each brand will need to

137、test which channels perform best for their specific products.Brands can deploy several high-level strategies to gain Gen Z loyalty:be authentic and transparent,embrace sustainability and social responsibility,and foster a sense of community or belonging.Here are a few real-world tactics to help buil

138、d trust and capitalize on those loyalty-building initiatives.4.Must-Leverage Marketing Channels 5.Securing Lifelong Brand Loyalty Personalize.Consumption is a form of personal expression for Gen Z,and personalization is something they have grown to expect.Gen Zers want custom experiences and product

139、s that fit their needs at their specific life stage.The proliferation of retail media networks and apps in recent years means its easier than ever for brands to target and personalize recommendations for Gen Z.Create experiences.Embrace emerging technologies like AI and augmented and virtual reality

140、 to help provide fun and immersive shopping experiences that speak to Gen Z.Virtual shopping with friends is another area of expected growth.A recent study found that almost one-third of Gen Z shoppers are currently interested in virtual shopping with friends.42 In the next five years,shopping in vi

141、rtual stores is expected to grow by 229 percent,while virtual shopping with friends may rise by 141 percent.Make it easy.Gen Zers have grown up in a time of instant gratification,with conveniences like one-click checkout and same-day delivery being commonplace.Brands courting Gen Z must continue to

142、find ways to meet expectations with fast and easy shopping experiences.of Gen Z shoppersare currently interested in shopping with friends.421/332 Gen Z will be the largest generation on record,and its spend is growing fast to the tune of$2.7 trillion USD of growth over the next six years.While Gen Z

143、s global spend will only make up around 20 percent of total spend in most categories for the next 10 years,it will overtake the spend of previous generations and sooner than you likely thought.Balancing Gen Z preferences and shopping behaviors(alongside aging Boomers and Gen Xers)will no doubt take

144、effort and best-in-class data to get right.What resonates with one Gen Zer may be off-putting to another in a different life stage,geography,or socioeconomic position,underscoring the critical need for accurate segmentation and hyper-targeting.As weve shown,painting Gen Z as a monolith is a surefire

145、 way to develop an ineffective strategy.Life stages translate to spend,and investing before those life stages is critical if you want to win Gen Z spend.Though appealing to Gen Z comes with challenges,it also comes with great rewards.Brands that want to capitalize on Gen Z future spend should get Ge

146、n Z consumers attention today,form a plan to build and maintain lasting brand loyalty,and capitalize on current-day Gen Z influence relative to spend.Wed love to talk with your team about how to align your innovation,merchandising and assortment,marketing,and omni strategies to the ever-evolving exp

147、ectations of the Gen Z consumer.The Big Takeaway for Brands and Retailers Gen Z is growing fast.Hook them now!Give us a call today.Gen Z is growing fast.Hook them now!About NIQ NIQ,the worlds leading consumer intelligence company,reveals new pathways to growth for retailers and consumer goods manufa

148、cturers.With operations in more than 100 countries,NIQ delivers the most complete and clear understanding of consumer buying behavior through an advanced business intelligence platform with integrated predictive analytics.NIQ delivers the Full View.NIQ was founded in 1923 and is an Advent Internatio

149、nal portfolio company.For more information,visit NIQ.com 2024 Nielsen Consumer LLC.All rights reserved.About World Data Lab(WDL).WDL creates forward-looking proprietary data to quantify and forecast consumer trends,consumer spending,demographic shifts,and progress towards the Sustainable Development

150、 Goals up to 2034.WDLs advanced data science approach,which has been peer-reviewed and published in Nature,delivers unrivaled accuracy freshness and consistency across all demographic groups in 180 countries and more than 6,000 cities.See charts for individual sources.Authored by NielsenIQ&GfK in co

151、llaboration with World Data Lab(WDL):Sources:1Consumer class is defined as anybodyspending over$12/day in 2017$PPP.2Richard Fry and Kim Parker,“Early Benchmarks Show Post-Millennials on Track to Be Most Diverse,Best-Educated Generation Yet,”Pew Research,November 15,2018,https:/www.pewresearch.org/so

152、cial-trends/2018/11/15/early-benchmarks-show-post-millennials-on-track-to-be-most-diverse-best-educated-generation-yet/3NIQ-GfK Consumer Life Global 2023.4“A Political and Cultural Glimpse Into Americas Future:Generation Zs Views on G enerational Change and the Challenges and Opportunities Ahead,”PR

153、RI,January 22,2024,https:/www.prri.org/research/generation-zs-views-on-generational-change-and-the-challenges-and-opportunities-ahead-a-political-and-cultural-glimpse-into-americas-future/5GfK Consumer Life Global 2023,A5,O30,C1.6GfK Consumer Life Global 2023,A5,O30,C1.7GfK Consumer Life,Global Gen

154、Z,March 2024 8GfK Consumer Life Global 2023 GG_1,GG_2,A2,E1/J1/M1(global=18 countries):GfK Green Gauge Plus 2022 study,ATS_1(global=10 countries);GfK Consumer Life,Global Gen Z,March 2024.9“What is Gen Z?,”McKinsey&Company,March 20,2023,https:/ Consumer Life Global 2023,A1,A2,L1(global=18 countries)

155、;*on list of 24.11GfK Consumer Life,Global Gen Z,March 2024.“Worries About Coronavirus Surge,as Most Americans Expect a Recession or Worse,”Pew Research,March 26,2020,https:/www.pewresearch.org/politics/2020/03/26/worries-about-coronavi-rus-surge-as-most-americans-expect-a-recession-or-worse/“Worrie

156、s About Coronavirus Surge,as Most Americans Expect a Recession or Worse,”Pew Research,March 26,2020,https:/www.pewresearch.org/politics/2020/03/26/worries-about-coronavirus-surge-as-most-americans-expect-a-recession-or-worse/12NIQ proprietary data.13NIQ/World Data Lab,Generations Analysis.14Stephani

157、e Chevalier,“Gen Z online shopping behavior statistics&facts,”Statista,January 10,2024,https:/ 15GfK Consumer Life Global 2022 16 World Data Lab,Generations Forecasts 17NIQ Omnishopper,Total FMCG Depts=Food,Baby Care,Health&Beauty Care,Household Care,Pet Care,Gen Merch;52 weeks ending January 27,202

158、4.18GfK,Generation TCG insights,08/03/24.19NIQ 2024 Consumer Outlook,U.S.,TikTok Shop sales.20GfK Consumer Life 2023,G6,O4,O7a20,TDA_1;GfK Consumer Life 2022,I1,G11;*on list of 10 items;2021,H32,*on list of 13 items(global=18 countries);GfK Consumer Life,Global Gen Z,March 2024.21NIQ/World Data Lab,

159、Generations Analysis,Consumer Class 2030.22NIQ/World Data Lab,Generations Analysis,Generation Overview USA.23NIQ/World Data Lab Generations Analysis,Consumer Class Choices.24Kalamata and New York,“Generation Z is unprecedentedly rich,”The Economist,April 16,2024,https:/ 25NIQ proprietary data.26NIQ

160、US Gen Z survey,Aug 2022,Q3.27NIQ/World Data Lab,Generations Analysis,Consumer Class Choices.28NIQ Consumer Life Global 2024.29NIQ US Gen Z survey,Aug 2022,Q13,Q9B.30NIQ Consumer Life Global 2024.31NIQ/World Data Lab,Generations Analysis,U.S.spend by generation.32 NIQ,Retail Measurement Services NIQ

161、 Product Insight,powered by Label Insight;Total US xAOC;Total Food&Beverage(including Fresh)vs Better For Segment;%change vs previous year;Last 4 years ending September 9,2023.33 NIQ US Gen Z survey,Aug 2022,Q12,Q9.34NIQ/World Data Lab,Generations Analysis.35NIQ Consumer Survey,PLMA Consumer Researc

162、h report.36NIQ proprietary data.37NIQ proprietary data 38NIQ Gen Z Present in HH.39NIQ Consumer Outlook 2024,Global.40NIQ US Gen Z survey,Aug 2022,Q10,Q16.41NIQ US Gen Z survey,Aug 2022,Q17,Q23.42GfK Consumer Life,Global Gen Z,March 2024.43”Generation Z is Unprecedentedly Rich,”The Economist,April 16,2024,https:/