Study: Younger consumers driving ‘buy now pay later’ purchases on social media

Consumers have different preferences regarding social media advertising strategies based on their ages.

Analyzing the responses of 500 surveyed consumers ages 18 and over, StitcherAds found that 60% of millennials and 57% of Gen Z respondents had purchased a product that featured a “buy now, pay later” (BNPL) option in a social ad, compared to only 37% of Gen X respondents and 19% of baby boomers.

The survey also found that 58% of millennial respondents prefer to see all of the details about a new product or brand in an ad, and don’t want to have to go to a company’s website to learn more. Fifty-six percent of Gen X respondents agree with millennials, while Gen Z respondents are split evenly on the topic.

However, 55% of baby boomers prefer to see less in an ad, and would like to discover more about the product or brand being advertised by visiting the company’s website. 

More than six in 10 millennials (63%), along with 56% of Gen X and 52% of Gen Z respondents, said they’ve tried a new brand or product based on an ad they saw on social media in the past month. Baby boomers, on the other hand, aren’t as influenced, with only 33% responding that they’ve tried a new brand or product based on a social ad in the past month.

Specifically examining Gen Z preferences for social advertising, the study found that 59% of Gen Z respondents shared that Instagram’s advertising influences their purchasing decisions the most, followed by TikTok (57%), Facebook (36%), and Twitter (29%). For the best ad experience, Gen Z cited Instagram (59%), followed by TikTok (48%), then Twitter (34%). 

Other interesting findings include:

• Millennials (79%), Gen X (71%), and Gen Z (59%) are more likely to click on a personalized ad on mobile device compared to a desktop. Meanwhile, more than half (53%) of baby boomers said they’re more likely to click on a personalized ad via desktop. 
• A majority of Gen Z (63%), Gen X (59%), and millennials (52%), agree they are more likely to click on a video ad over any other format. Close to half of baby boomers (48%) also prefer video ads.
• When asked if they were more likely to purchase something based on an ad if it featured a promo code or coupon, 96% of millennials and Gen X were very likely to do so. 94% of baby boomers agreed, along with 89% of Gen Z.  
• Just 13% of baby boomers and 29% of Gen X respondents are likely to recommend a product to a friend or family member based on an ad that they saw on social media. In contrast, almost half of (46%) of millennials and one-third (34%) of Gen Z respondents shared they are likely to make such a recommendation.

[Read more: Study: ‘Buy-now-pay-later’ usage set to explode]

“Recently, we’ve seen ‘buy now, pay later’ options grow in popularity as a way to keep up with the rapid shift to online shopping during the pandemic,” said Bryan Cano, director of strategy at StitcherAds. “Our analysis discovered that consumers of all generations use BNPL tools, but millennial and Gen Z shoppers are doing so at much higher rates. This is likely because BNPL provides younger consumers – whose cash flow tends to be more limited – better financial flexibility, especially for larger-ticket items.”