Move over Millennials, Gen Z is here, and they’re rewriting the rules of consumer behavior. Born between 1995 and 2010, this generation represents 25% of the global population and wields $360 billion in spending power in the U.S. alone. But what truly sets them apart isn’t just their size—it’s their values. From sustainability to digital-first shopping, Gen Z is demanding a new kind of consumer experience. For brands, understanding this generation isn’t optional—it’s essential.
Gen Z is the first generation of true digital natives, having grown up with smartphones, social media, and instant access to information. They’re also the most diverse generation in history, with nearly half identifying as nonwhite. This diversity fuels their passion for inclusivity, authenticity, and sustainability. While many are still in the early stages of their careers, their influence on the consumer market is undeniable—and it’s only going to grow as they mature into the largest, wealthiest consumer cohort in history.
For manufacturers and retailers, capturing Gen Z’s loyalty means understanding their unique preferences and behaviors. This article dives into what makes Gen Z tick, their spending habits, and how they’re reshaping industries like fast-moving consumer goods (FMCG) and consumer packaged goods (CPG).
Gen Z’s Consumption Habits: A Shift in FMCG and CPG
Gen Z isn’t just buying products—they’re investing in values. This generation prioritizes transparency, sustainability, and authenticity, and they’re quick to call out brands that don’t align with their beliefs. From food and beauty to fashion and tech, Gen Z is driving a seismic shift in consumer behavior. Here’s how:
1. Health-Conscious Choices: Clean, Natural, and Functional
Gen Z isn’t just eating—they’re curating. This generation is driving a seismic shift in the food and beverage industry, prioritizing clean, natural, and functional products. Think plant-based proteins, low-sugar snacks, and organic labels. In fact, over 40% of Gen Z actively seek out “natural” or “organic” products, according to Nielsen.
What This Means for Marketers:
- Reformulate products to meet demand for clean, natural ingredients.
- Highlight health benefits in marketing campaigns.
- Explore opportunities in functional foods (e.g., protein bars, gut-health beverages).
2. Beauty and Personal Care: Clean Beauty and Influencer Power
In the beauty and personal care sector, Gen Z is reshaping the landscape. They’re heavily invested in clean beauty, favoring products that are cruelty-free, non-toxic, and formulated with natural ingredients. About 60% of Gen Z consumers prefer brands that promote ethical and sustainable practices.
But it’s not just about the product—it’s about the story behind it. Gen Z is highly influenced by social media influencers and peer reviews, with over 40% relying on user-generated content before purchasing beauty products.
What This Means for Marketers:
- Invest in clean, sustainable product lines.
- Partner with micro-influencers who resonate with Gen Z’s values.
- Encourage user-generated content and reviews to build trust
3. Sustainability and Ethical Consumption: No More Greenwashing
Sustainability isn’t just a buzzword for Gen Z—it’s a way of life. Nearly 60% of Gen Z consumers are willing to pay a premium for products that are environmentally friendly and ethically produced. However, they’re also highly critical of brands that engage in “greenwashing” (making false or exaggerated claims about their environmental practices).
This desire for transparency extends beyond food and beauty. Gen Z is driving demand for sustainable packaging, eco-friendly cleaning products, and renewable energy solutions.
What This Means for Marketers:
- Be transparent about your sustainability efforts.
- Avoid greenwashing—back up claims with concrete actions.
- Explore innovative, eco-friendly packaging solutions.
4. Digital-First Shopping: Social Commerce and Beyond
When it comes to shopping, Gen Z lives online. They’re the first generation to grow up in a fully digital world, and their purchasing habits reflect that. A staggering 75% of Gen Z consumers make at least one online purchase per month, and they’re heavily influenced by social media platforms like Instagram, TikTok, and YouTube.
Social commerce is a rapidly growing trend, with Gen Z leading the charge. They’re not just browsing—they’re buying directly through social media, spending billions annually on platforms that offer seamless, interactive shopping experiences.
What This Means for Marketers:
- Leverage social commerce by creating shoppable posts and ads.
- Focus on platforms like TikTok and Instagram, where Gen Z spends most of their time
- Create engaging, interactive content that encourages participation.
Challenges for Brands: Staying Authentic in a Gen Z World
While the opportunities are vast, appealing to Gen Z isn’t without its challenges. This generation values authenticity above all else, and they can spot a disingenuous marketing campaign from a mile away. Brands that fail to align with Gen Z’s values—or worse, try to fake it—risk being called out and losing credibility.
- Avoiding greenwashing and ensuring transparency.
- Staying culturally relevant without appearing opportunistic.
- Balancing digital engagement with genuine human connection.
Conclusion: The Future of Consumer Behavior Starts Now
Gen Z isn’t just the future of consumer behavior—they’re the present. From their unwavering commitment to sustainability to their digital-first shopping habits, this generation is reshaping industries and setting new standards for brands. The question isn’t whether your brand should adapt to Gen Z—it’s how quickly you can do it.
Ready to connect with Gen Z? Start by auditing your brand’s sustainability practices, exploring social commerce opportunities, and creating authentic, value-driven campaigns. The brands that succeed in winning over Gen Z will be the ones that don’t just sell products—they stand for something.