Study: Younger Consumers Demanding Tech in Stores


The Retail Industry Leaders Association and the International Council of Shopping Centers have released a new report that defines the distinct shopping styles of Generation Z and Millennial consumers and discusses how retailers are adapting to their needs. 

"Shopping Styles in the (R)Tech Age" identities key consumer behaviors, industry leaders and considerations for retailers. The study also looks at the new trends shaping retail from a store and real estate perspective and the role physical retail plays in meeting the needs of young, tech-driven generations. 

"The industry has changed drastically at the hand of technology,” said Adam Siegel, senior vice president of research, innovation & sustainability at RILA. “But retailers' primary focus has always been providing the best customer experience, whether that means a quick, easy checkout or the opportunity to interact with different products in store."

Younger consumers are pressuring retailers to incorporate technology to meet their needs — on their terms, according to Stephanie Cegielski, vice president of public relations at ICSC. "The youngest — and thus future — consumer demands an integrated, personal experience throughout [her] shopping journey, both [online] and offline."

At 156 million people combined, Millennials and Gen Z are currently the two largest generations in the U.S., representing roughly half the total population, according to the U.S. Census Bureau. The youngest Millennials are beginning to enter the workforce, while most Gen Zers do not yet have any personal income.

These groups’ unique shopping habits and behaviors set them apart from previous generations due to their overwhelming need to fill four shopping needs: convenience, value, experience and conscious consumption.

Convenience: From 2006 to 2016, the average amount of time spent on purchasing consumer goods per day declined by 10%, according to the Bureau of Labor Statistics’ “American Time Use Study.” Between 2016 to 2017 alone, e-commerce sales grew 15.6%, per the U.S. Census Bureau. But a study by the ICSC found that more than half of Gen Z'ers visit stores so they can “get the item immediately.”

Value: An ISCS survey found that 84% of Millennials research products online before visiting a store and 87% use a mobile device while in the store. Top reasons for using a mobile device in-store include comparing prices and receiving digital discounts or coupons.

Young adults also want products and services that meet their needs. Forty-five percent of consumers surveyed by Segment are likely to repeat a personalized shopping experience, such as receiving a special discount offer based on they're purchases. And 73% of respondents to an Internet Retailer study opted to purchase online and pick up in store to avoid shipping fees.

Experiences: Younger consumers increasingly seek experiences over products. In 1985, they spent $1.1 trillion in total, with restaurants, escape rooms, gaming, concerts and other events comprising 22% of the total, said A.T. Kearney; in 2015, 28% out of $4.3 trillion went toward these pastimes. By 2030, total spending should climb to $7 trillion, 32% of which should be represented by experiences.

When it comes to “experiences,” social media is also an important pastime. On average, young consumers spend two hours a day browsing this medium, according to Social Media Today.

Conscious Consumption: Information on companies’ social and environmental activities is readily available and influences purchase decisions. Cone Communications found that 85% of Millennials seek out “responsible” products and 88% hold brands responsible for producing and communicating results of corporate social responsibility initiatives.