The Difference Between Consumers – Gen Z vs. Gen Y
Gen Y, or Millennials, generally refers to people born between the early 1980s and the mid-1990s. Meanwhile, Gen Z refers to those born between the mid-1990s and the mid-2010s. As consumers, there are a few key differences between these two generations:
- Interest and Understanding of Technology: Gen Z grew up in a world with more advanced technology than Gen Y. As a result, Gen Z tends to be more tech-savvy and comfortable with new technology than Gen Y. They are also more likely to use social media and other digital platforms to research products and make purchases.
- How They See a Business’ Values: Gen Z is often seen as more socially conscious than Gen Y. They tend to place a higher value on issues like environmental sustainability and social justice and are more likely to support brands that align with these values.
- Gen Z Prefers Personalization: Gen Z is more interested in personalized experiences and products than Gen Y. They are more likely to expect brands to tailor their marketing and products to their specific interests and preferences.
- Gen Y is More Loyal: Gen Z is generally less loyal to specific brands than Gen Y. They tend to be more price-sensitive and more likely to switch brands based on price and convenience.
Overall, Gen Z and Gen Y are similar to consumers, but there are also some key differences based on their upbringing, values, and expectations. Keep reading and learn more about how to advertise to both generations more effectively.
Breaking Down the Difference in Purchase Decisions
In 2023, Generation Z and Generation Y both hold immense purchasing power and reflect a lot of data surrounding consumer behavior. While there are some similarities between the two groups, there are also significant differences in how they make purchasing decisions. So, to best inform you on how to market to both generations, keep reading to pinpoint the key differences between the two generations. First, we are going to dive into their purchasing behavior. Then, we will discuss the reasons behind these differences.
1. Gen Y and Gen Z Grew Up in Different Digital Ages
Generation Z, born between 1997 and 2012, is the first generation to have grown up entirely in a digital age. As a result, they tend to be more technologically savvy than previous generations, and they are often more comfortable using digital platforms to research and purchase products. For Gen Z, social media is a significant factor in purchasing decisions. They are heavily influenced by the opinions of their peers and social media influencers, and they are more likely to purchase products that they have seen advertised on social media platforms like Instagram and TikTok. Gen Z is also more likely to use mobile apps and online marketplaces like Amazon to make purchases.
In contrast, Generation Y, born between 1981 and 1996, grew up when the internet was still in its infancy. While they are also comfortable with technology, they tend to rely less on social media when purchasing. Gen Y is more likely to use search engines like Google to research products and read reviews before buying. They are also more likely to shop in physical stores than Gen Z and tend to be more brand-loyal than their younger counterparts.
Keep these details in mind when looking to market to different demographics, depending on their age. The way in which your brand presents itself on social media can have a huge impact on customer retention.
2. Cultural Influences and Spending Habits
Another key aspect of the cause of differences in purchasing behavior is how the two generations have been shaped by their respective cultural and economic environments. Gen Z grew up during economic uncertainty, with many witnessing the effects of the 2008 financial crisis on their families. As a result, they tend to be more frugal and price-sensitive than Gen Y. They are also more likely to prioritize experiences over material possessions and place a high value on authenticity and social responsibility. For Gen Z, connecting with brands personally is more important than ever, and they are more likely to support companies that share their values and beliefs.
In contrast, Gen Y grew up during a time of economic prosperity, with many experiencing the benefits of the dot-com boom and the housing market boom. As a result, they tend to be more brand-loyal than Gen Z and more willing to pay a premium for products that offer superior quality or status. They are also more likely to prioritize convenience and speed when making purchases, and they are more likely to use credit cards to finance their purchases. So, in conclusion, it is evident that spending habits are a differentiator between Gen Y and Z.
3. Education Levels
Similar to their behavior surrounding spending habits, these two generations’ purchasing behavior differs due to their education level. For example, Gen Z is the most highly educated generation in history, with more attending college than any previous generation.
As a result, they tend to be more informed and knowledgeable when making purchasing decisions. They are more likely to research products and read reviews before purchasing, and they are more likely to value quality over quantity. For Gen Z, the ability to make informed decisions is a significant factor in their purchasing behavior. By comparing different levels in education, it makes sense that Gen Z and Y look at product research in a variety of ways.
Gen Y, on the other hand, tends to be more focused on immediate gratification and instant gratification. They are more likely to make impulse purchases and are less likely to research products before purchasing. However, they are also more likely to have disposable income, which makes it easier for them to make purchases on a whim.
4. Gen Z Values Social Responsibility
Lastly, Gen Z is more likely to be interested in a business’ values than Gen Y. One key reason is that Gen Z has grown up during a time of significant social and environmental change, which has led to an increased focus on social responsibility and sustainability. As a result, Gen Z consumers tend to place a higher value on businesses committed to positively impacting society and the environment.
On the other hand, Gen Z is the most diverse generation in history. This also means they tend to be more open-minded and accepting of different viewpoints and lifestyles. This means that they are more likely to support businesses that share their values and beliefs, and they are more likely to reject enterprises that do not align with their values.
Overall though the purchasing power and data collected from gen z and gen y consumers is equally important. The way in which these two generations make decisions and interact with brands can be drastically different. For more information on ways to better understand purchasing decisions or to better advertise your business, check out our blog. Here at Summit Crew, we have all of the marketing strategies you need and more to grow your consumer base today!