Futures

Understanding Gen Z Shopping Preferences: The Shift Towards Community and Experience in Retail, (from page 20231029.)

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Summary

Gen Z, the most digitally savvy generation, prefers shopping in physical stores for social experiences and to disconnect from digital life, as shown by a Kearney survey. With 81% favoring in-store shopping, retailers must create community-focused, immersive experiences to attract them, countering feelings of loneliness exacerbated by the pandemic. Successful retail environments, like Shanghai’s TX Youth Energy Centre, blend shopping, socializing, and entertainment. Gen Z values well-curated, minimalist experiences while also seeking unique, community-driven store designs that move away from generic concepts. Brands are encouraged to partner with local artists and engage in storytelling that resonates emotionally rather than focusing solely on transactions, emphasizing the importance of creating thrilling shopping experiences.

Signals

name description change 10-year driving-force relevancy
Gen Z’s Preference for In-Store Shopping Gen Z enjoys in-store shopping as a social experience and to disconnect from digital life. Shift from online shopping to in-store experiences for social engagement and community. Physical retail will evolve into community hubs that offer immersive social experiences. Desire for social interaction and relief from digital fatigue post-pandemic. 5
Sensory Engagement in Retail Retailers are focusing on creating immersive, sensory-rich shopping environments. From traditional retail to experiences that engage multiple senses in-store. Shops will become experiential spaces prioritizing sensory engagement and community connection. Consumer fatigue from digital experiences and a desire for tactile interactions. 4
Community-Centric Retail Spaces Brands are expected to collaborate with local artists and communities. Transition from generic store designs to community-focused, unique retail experiences. Retail spaces will be local art and culture hubs, reflecting community values and identity. Gen Z’s increasing awareness of social responsibility and community involvement. 4
Shift in Brand Authority Gen Z views themselves as experts rather than passive consumers influenced by brands. From top-down brand messaging to collaborative partnerships with consumers. Brands will adopt a more collaborative approach, prioritizing consumer input and co-creation. A desire for authenticity and partnership in purchasing decisions. 5
Diverse Retail Experiences Gen Z is driving the diversification of retail spaces beyond traditional formats. From uniform retail experiences to diverse, multi-purpose spaces that engage consumers. Retail environments will be dynamic, offering varied experiences beyond mere transactions. The need for unique and personalized shopping experiences in a post-pandemic world. 4

Concerns

name description relevancy
Retail Space Evolution The need for physical retail spaces to evolve into immersive, community-oriented experiences to attract Gen Z shoppers. 4
Loneliness Impact on Shopping Behavior Gen Z’s high levels of loneliness may drive them to seek social interactions in retail environments, creating a need for spaces that foster community. 5
Screen Fatigue Responses Post-pandemic trends indicate an increased demand for sensory engagement in retail as a counter to digital fatigue. 4
Diverse Retail Offerings Retailers must diversify their offerings and partnerships with local artists to remain relevant in Gen Z’s eyes. 4
Customization vs. Generic Experiences The risk of providing generic retail experiences could deter Gen Z consumers who seek unique and personalized shopping environments. 5
Micro-Influencing as a New Norm Brands must adapt to the micro-influencing trend where consumers expect to engage as experts rather than passive recipients of marketing. 3
Community Engagement Expectations Gen Z expects brands to connect with their local communities and understand their social impact. 4
Shifting Brand Authority The traditional brand-consumer hierarchy is changing as Gen Z sees themselves as partners, not just consumers. 4
Experience over Transaction There’s a growing expectation for retailers to provide memorable experiences rather than just transactional interactions. 5

Behaviors

name description relevancy
Physical Store as Social Space Gen Z prefers shopping in physical stores as social excursions, seeking community and a break from digital distractions. 5
Sensory Engagement in Retail Retailers are expected to enhance sensory experiences to combat screen fatigue and create immersive shopping environments. 5
Decompression Zones in Stores Brands need to create spaces for relaxation and mental pause to appeal to lonely Gen Z shoppers. 4
Curated Store Experiences Gen Z shoppers value well-curated stores focused on limited products over minimalistic designs. 4
Unique and Flexible Retail Spaces Stores need to avoid generic designs and provide unique, flexible concepts that invite exploration. 5
Community-Centric Retail Brands are expected to partner with local artists and engage with their communities to enhance social relevance. 4
Consumer as Expert Gen Z views themselves as experts, expecting brands to act as partners rather than authorities. 5
Emotional and Memorable Shopping Experiences Luxury brands must create emotional connections and memorable experiences beyond transactional interactions. 5

Technologies

name description relevancy
Sensory Engagement in Retail Retail spaces are incorporating tactile and immersive experiences to enhance shopping, countering digital fatigue. 5
Decompression Zones Retailers are designing spaces for relaxation and social interaction to attract Gen Z shoppers. 4
Modular Retail Spaces Stores are adopting flexible designs that allow for easy changes in layout and experience. 4
Micro Influencing Brands are leveraging micro influencers to create more personalized and relevant shopping experiences. 4
Community-Driven Store Concepts Retailers are partnering with local artists and communities to enhance the social function of stores. 4
Immersive Online Shopping Experiences Brands are integrating ambient sounds and sensory elements into online shopping to create engaging experiences. 3

Issues

name description relevancy
Gen Z Shopping Behavior Shift Gen Z favors physical shopping as a social experience, indicating a shift away from online shopping despite being digital natives. 5
Sensory Engagement in Retail Retailers are focusing on creating immersive, sensory experiences to combat screen fatigue among Gen Z consumers. 4
Loneliness and Isolation Among Gen Z Gen Z is reported as the loneliest generation, prompting brands to create spaces for social interaction and decompression in stores. 5
Customization and Modular Retail Spaces Brands are moving towards customizable, modular retail spaces to enhance the shopping experience and engage Gen Z effectively. 4
Community-Centric Retail There is a growing expectation for brands to collaborate with local artists and reflect community values in their retail spaces. 5
Micro-Influencing in Luxury Brands Luxury brands must leverage micro-influencing and storytelling to remain relevant to Gen Z shoppers who seek meaningful experiences. 4
Physical Retail Experience Transformation The transformation of physical retail spaces to provide thrilling and memorable experiences is essential for attracting Gen Z consumers. 5