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華爾街日報The “Younger” Side of Luxury Retail
Gen Z members are defined as those born between 1997 and 2012. They make up 21% of the U.S. population and by 2030, will have reached adulthood.
And, according to a Newmark report entitled “Luxury Retail: Meet Gen Z,” the “cohort is becoming a major force in the luxury retail industry’s future.”
Why It’s Happening
One reason Gen Z is exerting an influence on the luxury retail sector is that the demographic is experiencing what Newmark experts call “impressive economic momentum.” Specifically, the younger adults enjoy high standards of living, and they’re moving up the economic ladder more quickly than the Millennials before them.
Gen Z is described by Bank of America as a “new economic force,” with this cohort’s household spending growth higher than that of the general population, especially in areas such as entertainment and travel.
What They Want
The report indicated that the young adults are moving from status to “authentic, express experiences.” The Gen Z shoppers want “expressive luxury” that helps them remain true to themselves. Quality and value matter as much as the label. Sustainability and convenience matter as well.
While this demographic relies on artificial intelligence to enhance their shopping experiences, they also want to limit screen time and prioritize the social aspects of shopping.
How Luxury Retailers are Reacting
The Newmark experts noted that luxury retailers are meeting Gen Z demands by “building loyalty through tailored digital experiences, forging emotional connections through values-led storytelling and cultivating accessible yet refined environments—online and offline—that invite participation rather than passive consumption.”
Some brands focus on art and cultural elements. Other fashion houses are expanding their entry points by providing restaurants and cafes within their flagship stores.
Next Steps
The report suggested that luxury retailers and investors might want to consider the following in order to reach this high-spending cohort:
- Partner with established influencers to develop user-generated content
- Host experiential events that encourage existing customers and prospects to engage with the brand
- Pair sustainability with storytelling
- Target metropolitan areas where Gen Z populations and household income are growing
- Consider mixed-use and lifestyle centers in high-growth areas for stores
- Deliver experience-rich environments that are tech-enabled and flexible
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