Nearly Two-Thirds of Gen Z Will Shop Mostly Online – But Only if the Digital Experience Is Great
After years of focusing on the millennial consumer, a large number of brands are looking to meet the needs of Gen Z shoppers and build long-term loyalty in that younger demographic. But these digitally-native consumers have a unique set of shopping behaviors that can be challenging for brands to cater to, without the right online expertise. And the stakes are high: New data from Sitecore shows that 74% of Gen Z-ers will exit if an item is out of stock.
The survey from digital experience management platform Sitecore, which analyzed responses from over 1,000 Gen Z consumers in the U.S., found that loyalty was a particularly vulnerable issue for this group of shoppers. While an openness to trying new brands online (80%) can bode well for companies trying to acquire more customers, this can also leave brands vulnerable to churn.
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“This group has quickly shifted its significant spending power online, and pressure will continue to mount on retailers until they can deliver an experience that delights,” said Paige O’Neill, chief marketing officer at Sitecore. “Brand loyalty has evaporated and there is no margin for error any longer from browsing through to delivery.”
For the businesses wanting to grow their Gen Z consumer base, focusing on online performance is an important area of investment. Sitecore found that over half (63%) of shoppers in this group now find online shopping more enjoyable than in-store, while 64% identify as “digital converts” and intend to buy the majority of their items online.
Brands that have a high quality digital consumer experience have a lot to gain, but the emphasis is on “high quality.” Gen Z respondents were quick to ditch a retailer if they had a bad experience, with 38% saying they would give a brand a single second chance before switching to a competitor. Specifically, inventory is the most important component to stay on top of, with 74% moving to a competitor if an item is out of stock.
“This study highlights that brands can’t ignore the power of poor digital experiences when it comes to Gen Z and its shopping habits,” said O’Neill. “The ability to consistently create personalized experiences is critical to secure the wallets of Gen Z. This puts technology firmly at the center of this new battle for retailers.”
In today’s retail landscape, digital experiences can come in all formats and styles, but Sitecore found a few consistent demands from this demographic. Personalization continues to be table stakes for 71% of respondents, while 80% favored retailers who are able to deliver in less than 24 hours; free shipping was less in demand, with only 37% identifying this as the most important element of their order.
Other important areas for brands to consider involve the technology that underpins their e-commerce offering. Younger shoppers are increasingly likely to shop on mobile, with 26% making their first mobile purchase since COVID-19; unsurprisingly, 53% stated it was important that a retailer have a site that operates well on mobile.
Others focused on data-supported services: 46% wanted the website to remember their shopping preferences while 43% wanted tailored recommendations. Ultimately, if a brand is able to support “new and exciting” online shopping experiences, that will appeal to three-quarters of Gen Z shoppers today.
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