A new generation is captivating retailers with its technological sophistication and interest in digital experiences.
I graduated college in the early 1990s as part of an exciting new generation called “Gen X.” We wore a lot of flannel and enjoyed the best popular music scene since the late 1960s. Brands and retailers coveted our attention (and dollars). Some efforts sputtered (remember OK Soda?), while others thrived (such as Gap Inc.). Then the millennium dawned, and with it came the new generation everyone wanted to engage – the millennials.
Unlike Gen X, millennials were “digital natives” who had a much better grip on the emerging Internet landscape. As e-commerce transformed into omnichannel, millennial consumers led the charge with growing purchasing power.
Enter Gen Z. Roughly spanning consumers born between 1997 and 2012, this generation, which has literally never known life without constant Internet access, is stealing the commercial spotlight from millennials.
Here are three specific retail tech trends being driven by a desire to engage Gen Z consumers:
In the metaverse, consumers use augmented and virtual reality technology to digitally engage with each other and their surroundings, with crossovers into the physical world. For example, numerous retailers are introducing metaverse experiences in the Gen Z-skewing Roblox virtual environment, exemplified by the recently launched Nikeland space from Nike.
Virtual buildings and fields inside Nikeland are based on the company’s real-life headquarters. Among other features, a digital showroom enables customers to outfit their Nikeland avatar with special Nike virtual products.
The metaverse can also integrate with the “real” physical world, as evidenced by a promotion during the 2021 New York Fashion Week event where Gen Z-favored brand Crocs partnered with flex payment platform Afterpay to reveal an exclusive collection of Jibbitz shoe charms (if you’re old enough to drink, don’t ask) at a Times Square digital “Dropshop” AR-based shopping experience.
The metaverse provides retailers with the opportunity to monetize new storefronts and product assortments that require little or no physical overhead, in a way that meets the cultural preferences of Gen Z consumers.
Ultrafast delivery services that fulfill orders in less than 15 minutes are nothing new, but before 2021 they were mostly offered on a highly localized basis by smaller platforms. Then larger players came in, like European fast delivery startup Gorillas, which fulfills online grocery orders in 10 minutes or less and debuted in Brooklyn at the end of May 2021.
Or like Philadelphia-based Gopuff, which provides speedy delivery (in as little as minutes) of immediate everyday needs and is expanding on the West Coast. Now, the major third-party delivery platforms are starting to get in on the disruptive action. For example, DoorDash is introducing ultrafast grocery delivery in New York City via its DashMart online convenience storefront.
Ultrafast delivery checks all the Gen Z boxes – completely app-based, fulfills demand in “Internet time,” and mostly operates in urban areas. The grocery store of choice for today’s under-25 consumer is a combination of their phone and their doorstep – and none of that two-hour delivery window nonsense.
According to a recent survey of over 2,200 U.S. adults from Morning Consult, 42% of respondents have used mobile wallet payments.
However, the general figures represent a wide variance in mobile wallet usage by consumers of different generations. For example, only 21% of baby boomers and 36% of Gen Xers have used mobile wallets. These percentages rise much higher among millennials (53%), and especially Gen Zers (62%).
It’s no surprise that a generation that played with toy smartphones as toddlers and has come of age in the era of pandemic-inspired touchless commerce would gravitate toward mobile wallet payments. Retailers anxious to draw Gen Z customers will surely gravitate toward mobile wallet solutions, as well.