The pandemic has changed every aspect of everyday life. After more than a year of being indoors, the public has acquired new habits and routines while in quarantine. The global crisis, which claimed the lives of millions, also has altered the priorities of every person.
These shifts are reflected in the relationship of people, especially younger generations, with money, and how they spend it.
Members of Generation Z, in particular, are a concern because the age group makes up 40 percent of consumers in the United States. By 2026, the demographic born between 1996 and 2010 will surpass their predecessors, the Millennials, as the largest consumer base.
It is interesting to find out how the pandemic made a mark on Zoomers.
Quick to Adapt
It turns out, Gen Z was largely unaffected by the changes that took place during the pandemic.
The age group grew up in a world where the internet and personal computers are ubiquitous. They are called digital natives because they are comfortable navigating the world wide web, unlike their parents and grandparents.
Therefore, the transition from face-to-face work or classes was not an issue,
They immediately adapted to the new setup and, because they use electronic devices a lot, they are better equipped to cope with the new normal. Communicating via video calls, chats, and emails were part of their day-to-day life, even before the pandemic. They also know how to use digital services such as internet banking and online shopping which made being at home convenient.
But, it did accelerate certain trends. Gen Z has always been driven by their values. The age group tends to be aware of the situation of their peers, and fight the inequalities in society. Their purchases are driven by their beliefs.
The pandemic has pushed them toward “thoughtful consumption,” a movement that supports buying from brands that are sourced sustainably and ethically and support important social issues. They are not interested in luxury brands. In one survey, 27 percent of Gen Z consumers said that they plan to buy more from local businesses compared to before COVID-19. About 21 percent will make an effort to purchase from minority-owned businesses.
Online Shopping Now, Stores Later
During the holiday season, over half of them also said that they did not feel safe to shop in brick and mortar stores. They chose to instead buy their gifts for loved ones and for themselves via e-commerce sites and apps.
Gen Z consumers are also known to use social media to research products that they want to buy. Instagram, Facebook, Twitter, YouTube, Pinterest, and TikTok have a significant influence on how they find products and how they made the decision to acquire them.
However, they will only shop online during the pandemic. When the restrictions are lifted, many of them will go back to shopping in-stores. They enjoy the experience of going to a shop and trying on the products that capture their attention before making a purchase.
Saving Their Money
The pandemic has also encouraged Gen Z to save their money. The generation has witnessed financial hardships that many Americans had experienced in the past year. In fact, half of the oldest Zoomers admitted that they, or someone they know, lost their job or had taken a pay cut due to the public health crisis and the resulting economic recession. Some can no longer support themselves and, therefore, had to move back to their childhood home.
This inspired members of Gen Z to set aside money for their future. A study by Northwestern Mutual found that over 16 percent of Zoomers have been saving more for their retirement since the pandemic. Many of them also paid off their credit card debt or student loans.
However, almost the same number of Zoomers had to defer savings for retirement possibly due to their financial situation. Older members of Gen Z have already entered the workforce. Some of them were laid off or earned less and, therefore, have no choice but to be more careful of how they spend their money.
Generation Z is still far from reaching its peak earning and spending years, but it is an important group for retailers. How the pandemic changes their spending behaviors will have an impact on profit and the market.