How Gen Z’s shopping habits will shape the future of retail

This article is part of our new editorial package, The Future of Shopping, in which we predict how the retail landscape will be shaped over the next decade. Click here to read more. “My algorithm is just too good,” says 25-year-old content creator Tora Northman, who is also senior social media manager at site Highsnobiety. On TikTok, Northman finds everything from style inspiration to hidden vintage gems in London. “I could spend so many hours on there just because the content is so varied.” Lately, we’ve become obsessed with the impact of algorithms on personal style. For many, the broad consensus is that it’s for the worse: the sheer amount — and similarity — of product and content makes discovering unique items harder than ever. But Gen Z isn’t convinced. Vogue Business recently surveyed Vogue and GQ readers to gauge the next generation’s shopping habits and how those will shape the future of retail. Forty-eight per cent of Gen Z respondents agreed that fashion product recommendations from algorithms have positively impacted their shopping experience. They’re the most likely generation to report a positive impact. Younger audiences also say they’re more likely to purchase items recommended by algorithms. For content creator Tariro Makoni, who is also a strategy manager for global startups at Amazon Web Services, the role of the algorithm is always top of mind when spending time in online environments. Born in 1996, she’s a ‘zillennial’: “A geriatric Gen Z or baby millennial depending on the day,” as she puts it. “I’m hyper-conscious that I exist in a loop of algorithmic recommendations.” The online shopping journey has changed in the social media context, Makoni adds. “Traditionally, there were more steps when it came to research — and the identification of the need versus the eventual consumption of that look that you’re curating, or the specific item you’re buying,” she says. “All I need to see now is four girls wearing the Alaïa mesh ballet flats, and I’m like, sign me up.” While the Gen Z shoppers we spoke to do acknowledge the algorithm’s impact on what they see, they don’t see it as an all-out negative. Plus, they believe they’ve managed to hack the algorithms that they engage with daily to show them the kinds of content they want to see. Young consumers are, after all, tech savvy. “They’re digital natives: the first generation to grow up with a fully immersed internet and social media experience that’s powered by algorithmic feeds. It’s the norm, and familiarity fosters comfort and acceptance,” says social media consultant Matt Navarra. Algorithmic recommendations are usually personalised (or at least appear to be) and immediately gratifying — both of which appeal to the always-on Gen Z consumer. This consumer helps cultivate their own algorithmic recommendations by engaging with similar content across platforms, Makomi adds. Northman is used to cultivating her style identity via the internet. She’s been on Twitter since age 11 and ran multiple blogs growing up, where she’d post webcam outfit pics. She graduated to Instagram in the “glory days of fit pics” (since replaced by less-obvious photo dumps). “From a really early age, that was a behaviour that I was expressing,” she says. Below, see the key findings per Vogue and GQ readers’ views on shopping and discoverability in algorithmically defined spaces. Plus, additional insights from fashion-conscious Gen Zs (and one zillennial) on how they shop today, to help brands future-proof for tomorrow. Where Gen Z is spending time Instagram is the top social media platform used daily — but Gen Z prefers TikTok. Gen Z are more engaged with social media and are significantly more likely to be using YouTube, TikTok, Snapchat and Pinterest daily compared to other generations. Instagram is also the top platform respondents use for fashion advice and inspiration across all ages and gender. Gen Z are significantly more likely to be using Pinterest, TikTok and YouTube for inspiration compared to other generations. Twenty-one-year-old content creator and student Noah Miller goes to Pinterest first, then Instagram. “Pinterest is great for things like keywords and buzzwords for trends — you can find a very specific style or outfit that you’re looking for,” he says. For 23-year-old TJ Eaglin, director of marketing at non-profit Legacy Youth Leadership, TikTok and Instagram are the go-tos. “The TikTok algorithm and Shop are undefeated,” Eaglin says. “They’re too good.” Northman swears by TikTok. “I don’t like Instagram. I’ll go on it for five minutes, maybe.” On Instagram, she says, she wants to see content from family and friends. TikTok, she says, is more fun as a means of content consumption. Brand takeaway: Instagram and TikTok are table stakes. To capture the younger generation — and their growing spend — brands should experiment now with how to show up and engage on YouTube, Snapchat and Pinterest. Digital reigns supreme Though Gen Z is into physical experiences, the bulk of young respondents say they prefer shopping online because of the wider brand selection, plus the recommendations they can get via ads and algorithms. The younger the shopper, the more inclined they are to look for inspiration online. Though older generations (Gen X and older) are significantly more likely to discover new fashion brands through magazines and newspapers, younger respondents (Gen Z and millennials) are significantly more likely to discover via social media, influencers and celebrities. This means Gen Z still spends most of their discovery-mode time in algorithmically defined spaces. When you get into the differences between Gen Zs and millennials, though, some interesting points emerge. The biggest differences are between the prevalence of social media as a discovery destination, and the influence of those that populate social feeds: influencers and celebrities. Perhaps this is because Gen Z finds more enjoyment in online discovery than their older counterparts. Ninety-two per cent of Gen Z respondents enjoy finding inspiration for fashion items online — versus 84 per cent of millennials; 77 per cent in the 43 to 58 age bracket; and 75 per cent of those 59-plus. Both Miller and 22-year-old content creator and student Eric Suarez check online before heading in person. Suarez will suss out products of interest on TikTok, then seek out the brands IRL to try on — as well as other similar styles he finds along the way. Miller, meanwhile, thrifts in person. But before going, he turns to Pinterest to narrow down what he’s looking for. Brand takeaway: To grab — and retain — Gen Z consumers, brands should double down on online, while augmenting with physical experiences. They should also lean into influencer and celebrity marketing, but through longer term engagement strategies (as opposed to one-off spon-con posts) to avoid the traps of influencer fatigue, and keep shoppers engaged as they age up. Algorithms appeal to the youth Gen Z consumers in particular are aware of the algorithms that order their feeds — and they’re generally happy with the role they play. Across the board, consumers are ambivalent about the extent to which algorithmic impact on purchase decisions is a positive. This translated through the many conversations with the Gen Zs consulted for this piece — the general consensus was that, though algorithms are helpful, they can sometimes lead to sameness and unwanted recommendations. Algorithms enable a stream of personalised content — a plus for a generation that values individuality as much as Gen Z does, Navarra says. “From an identity perspective, you feel proud of your algorithm,” Makoni says. “It’s something that you want to continue to invest in, because you feel like it’s so well curated for you.” Brand takeaway: Make content geared towards a target consumer group (rather than the masses), because consumers want to see content that’s tailored to them. Over time, this will foster long-lasting community. Niche can win. Making life easy Gen Zs like algorithms because they make discoverability easy. “For fashion, I really love it, because it makes my life easier,” says 21-year-old student Allison Chen, who is also a food content creator. “It’s really easy for me to add new pieces based on what’s being shown to me.” Plus, it helps brand discoverability, she adds. “If there’s one brand that I really like, but I don’t want my entire wardrobe to be from the same place, I can easily find things that are similar to what I already like.” As a consumer, Miller finds algorithmic shopping recommendations useful. “It helps when you have a vacation outfit or specific thing you want to wear to a concert or a festival or a party and you almost get spoon-fed exactly what you’re looking for,” he says. Gen Z feels it’s easier because they came up with the tech, Navarra says. They’re used to — and appreciate — the effortless discovery that algorithmic feeds enable. “They expose users to new ideas and trends and other creators without having to actively search. That appeals to Gen Z’s desire for novelty and constant stimulation.” The younger the consumer group, the more likely they are to say that online discoverability has become easier in recent years. Whenever she travels, TikTok is Northman’s first point of research. “I find a lot of really interesting physical stores.” She recently visited Tokyo, where she’s been a handful of times. “The past two times when I’ve been back — since TikTok — I found a billion more places. And I thought it was a city where I knew where to go for the vintage bits.” “I get basically all of my shopping tips from TikTok,” Northman says. “Even garment care — things I wouldn’t know otherwise because I’m not going to be going out to look for it.” Suarez agrees. “TikTok will show you new styles of content you might never have searched for yourself,” he says. “They kind of know things about you before you do.” When shopping, though all consumer groups would rather search for items than receive suggestions, Gen Z are more receptive to suggested content and items than older generations. Even so, suggestions need to be good to be appreciated. Sometimes, they feel out of left field, even with a personalised algorithm. This is why Miller relies on Pinterest for fashion. “On other social media platforms, you’re inundated with all the stuff that you might not want to see,” he says. Brand takeaway: Young consumers enjoy ease, so brands should make discovery easy. Ssense is a useful blueprint. The e-tailer curates outfits, often tied to trends, and posts these as easy-to-digest social media (namely Instagram) content. As both product range and content output continue to grow, it’s the brands that make consumers’ lives easy who will win. Trends aren’t sure-fire — but FOMO creeps in Half of the sample feels that style and trends have become more similar. This is higher for women: 57 per cent of women versus 45 per cent of men. That said, the majority of the sample — 77 per cent — says they still feel they have a strong sense of personal style. Though things get interesting when you break it down by generation. Younger consumers are less likely to agree that they have a strong sense of personal style than older consumers. So, the older you get, the more likely you are to ‘strongly agree’ that you have a strong sense of personal style. Miller says 100 per cent of his style is influenced by what he sees online. “I pride myself on my personal style and I’ve created my closet for many years — but if I did not have social media, my taste, my shopping habits and behaviour would look extremely different.” For Eaglin, it’s 50-50. He feels like he has his own style, but is experimenting more thanks to what he sees via his social media algorithms. “That’s when it gets more playful and it’s like, ‘Oh there’s a new thing on the block, how can I incorporate this into my own style naturally?’” This is where the FOMO creeps in, Navarra says. “Algorithmic feeds create a sense of FOMO by constantly showcasing trending content [and products] that fuel a desire to stay on top of what’s current.” Not all Gen Zs feel the same. Chen leans offline for discovery. “I don’t even know where to start online,” she says. Makomi says social media impact is “marginal”, with the physical world offering up 70 per cent of her inspiration, she estimates; online just 30 per cent. Gen Z may be more swayed than their older counterparts, but they won’t blindly follow trends. “People just start buying into certain things because they see other people doing it,” Northman says, pointing to Stanley cups and Sambas. “Maybe I’m talking myself up here being like, ‘Oh yeah, the algorithm doesn’t impact me,’ but I’ll see it be like, ‘Why this cup?’ I don’t need to own this particular thing.” Although not everything on TikTok is the same, because not everyone dresses the same, Northman adds. “Everyone always says that TikTok is like a trend killer because everything just becomes a trend,” she says. “I get more of a well-rounded style perspective. It has all this information and all of these tips and tricks and you can easily find really cool people that have personal style that’s not like the Instagram influencers.” Brand takeaway: Younger consumers are more beholden to online trends than older consumers — and many of them lean into that. But they can spot when brands are forcing it. Brands should embrace online trends when there’s genuine alignment, but steer clear if it’s not a clear fit. Micro-trends will come and go. Brands want to ensure consumers will stay. Comments, questions or feedback? Email us at feedback@voguebusiness.com. More from The Future of Shopping: The Vogue Business guide to TikTok Shop What really happened with Matches and where do we go from here? Can good customer service make shopping fun again?

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