Picture this: you’re strolling through the aisles of a brick-and-mortar store and a product catches your eye. You must have it! Rather than queuing up at the checkout, you instinctively reach for your smartphone. You scour the web for a better deal and opt for the convenience of next-day delivery.
Sound familiar? If you’re nodding along, you’re likely part of the near 50% of Gen Zs and Millennials who embrace this particularly digital shopping habit, according to a recent survey by Retail Economics. However, if this notion of digital bargain hunting feels foreign to you, chances are you’re among the over-55 demographic, many of whom still prefer traditional retail experiences.
Data clearly shows that younger cohorts exhibit a greater inclination towards online activities compared to their older counterparts. Millennials, having come of age during the dawn of the digital era, paved the way for Gen Zs. Gen Zs are true digital natives, having never known a world without the internet.
Unsurprisingly, this digital fluency translates into their shopping habits. Even after the COVID-19 pandemic accelerated a shift towards online shopping across all age groups, a 2023 study by Jungle Scout revealed that only 7% of Baby Boomers engage in online shopping once a day or more compared to the 32% of Gen Zs who do the same.
So, what does this mean for the future of e-commerce? Significantly, Gen Z and Millennials’ peak earning and spending years are still to come. According to a report by Clearpay, these two cohorts accounted for 25% of the UK’s total retail spend in 2021. This figure projected to soar to 39% by 2030. And if their current shopping habits are any indication, a significant portion of this expenditure will occur online.
In light of this, it’s clear that the cohort effect will be one of the primary drivers of e-commerce growth in the coming decade. While innovations like Artificial Intelligence, Augmented Reality, and delivery drones garner headlines, it’s the entrenched digital preferences of younger generations that make one thing certain. The era of digital commerce is here to stay.