NIQ and World Data Lab unveil “Spend Z” Report
NielsenIQ (“NIQ”) collaborated
with World Data Lab (WDL) to issue the first of its kind, comprehensive
generational spending report purely focused on Gen Z. The research and analysis
presented in the “Spend Z” report highlights NIQ’s commitment to delivering
actionable market insights.
he report uncovers precisely what companies seeking to secure pathways
to growth need to urgently and intimately understand about Gen Z, the largest
and first truly global generation ever, including their preferences, spending
habits, values, priorities, how and where they shop, what they purchase, and
how they influence the purchasing patterns of other generations.
The report found that Gen Z, defined as anyone born between 1997 and
2012, makes up 25% (2 billion) of the world’s population, and
their global spending power is projected to grow to $12 Trillion USD by 2030,
potentially making them the wealthiest generation in every region of the world.
The youngest generation is set to overtake Boomer spending by then. By 2034,
Gen Z will add more than $9 trillion dollars in spending globally more than any
other generation.
“Gen Z is here, they are ready to spend, and companies need to know how
to pivot to serve them. Understanding what makes this
generation different is key to unlocking the greater than $12 Trillion USD
growth opportunity they represent,” said Tracey Massey, NIQ’s Chief
Operating Officer. “Companies are trying to understand the opportunities
for growth with Gen Z, and how they are influencing others. “Spend Z” is just
one example of how NIQ helps our clients uniquely achieve their ambitions by
anticipating and meeting consumer needs.”
Key Gen Z Takeaways:
· They demand
authenticity: They are more interested in authentic relationships with
influencers and brands. “Being true to yourself” is the number one ranked
description of success for Gen Z globally. Belonging and self-esteem are two
other top values, along with a strong sense of identity that is linked to
social causes and activism.
· Unprecedented foot
traffic: Their in-store purchases make up almost 50% of their share of
dollars and is higher than every other generation before them, even though Gen
Z begins their shopping journey online, ranks online reviews from other
shoppers as the most important factor when shopping and is heavily influenced
by social media.
· Global purchasing
power: Gen Z will become the highest consumer spending class in many
regions, and 30% of the global workforce in 2030. North America, Europe and
APAC will continue to dominate the majority of spending with APAC becoming
increasingly important. They currently have a more significant share of
consumption in regions including Sub-Saharan Africa, Middle East & North
Africa, and LATAM & Caribbean, where they make up a more substantial
portion of the population.
· Health and wellness
matters…to some extent: Overall they are health conscious and sustainability
minded. The most dynamic demand growth among the Gen Z consumer class is in the
health categories, as well as in alcohol / beverages.
o 81% of TikTok USD
sales are expected to come from health and beauty, showing an outsized impact.
o Over 50% of Gen Z
has used a fitness or exercise app, and 17% have used a fitness band to track
health and fitness information.
· Technology
accelerating behavior:
o Online reviews from
other shoppers are paramount when shopping with 53% of Gen Z population likely
to make purchases on social media or live stream platforms.
o 26% of Gen Z use
their phones while shopping physically in store to make decisions compared to
23% of Gen Y, 18% for Gen X and 12% for Boomers.
With Gen Z prioritizing health and the environment, we also expect NIQ
Better For™ - a classification leveraging our proprietary algorithm to
identify brands through product characteristics, positioning, sales and
distribution - products to continue to grow faster than conventional products.
This category includes products that are “better for” the consumer, the
environment, and society. Currently, small brands and younger generations drive
62% of the growth in this category.
“Gen Z is the most connected, largest and influential generation yet,” said NIQ
Chief Communication Officer Marta Cyhan-Bowles. “Gen Z will have fewer
children – later, will have unprecedented spending power, and will continue
prioritizing certain categories – like health and wellness – to an extent
generations before them have not. Our analysis leaves no doubt: investment in
Gen Z today will pay off tomorrow.”
"Gen Z is the largest, the richest, and the most global
generation ever” said Wolfgang Fengler, CEO, WDL. “Businesses
need to know that Gen Z is 2 billion people strong, and meeting their needs is
a must.”
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