Gen Z, Millennials Shoppers Are Sensitive to Prices
But they are less likely to be loyal to brands.
Feb 28, 2019
ALEXANDRIA, Va. - Gen Z and young millennials are much more sensitive to price points and less brand loyal than previous generations, according to a new study released by Swift Prepaid Solutions and reported by Grocerydive.com.
The survey, which included 202 respondents between ages 18 and 29, found that more than 80% believe price is the most critical factor when making a purchase. Half of the respondents said they believe name brands cost more than private label brands, and 67% said name brands are what they buy when they want assurance a product will meet their standards.
The Gen Z and young millennials said that the way they learn about new brands is from friends and family, Google, social media, Amazon, retail stores and television. Rewards and surprises attract this age group: 83% said value-added rewards and surprises inspire greater loyalty, and 82% said when earned rewards come paired with a special offer, it can encourage them to spend the reward.
When quality really matters, younger shoppers are more likely to shop name brands, but they turn to private labels when they're looking for lower prices, the researchers reported. Name brands are important to them when they purchase smartphones (79%), computers and electronics (72%), cars (69%) and large appliances (65%).
The report also touches on the motivations of young shoppers. When it comes to a brand name they use regularly, 68% are willing to refer a friend, while only 56% would refer a friend to a private-label brand they frequently use. Meanwhile, 41% would refer a friend to receive a reward. According to the survey, referrals are the number one way to grow a brand base beyond price.
When it comes to foods and beverages, a separate report from The NPD Group found that while Gen Z shoppers are less brand loyal than previous generations, they value freshness and flavor. Gen Z also loves to snack, preferring healthy, unprocessed choices over traditional chips and cookies. NPD projects Gen Z will drive 5% growth in holistic and healthy snacks by 2023.
