Gen Z: the new kid on the block is making its voice heard
The Millennial Generation is a known force in consumption. It’s a huge generation by the numbers, and it hit full spending power a few years ago (today, the generation encompasses people between the ages of 22 and 40). Understandably, many brands are heavily focussed on this cohort – but younger minded (and forward thinking) companies across a variety of sectors are looking to the generation that will succeed millennials: Generation Z.
Generation Z will start to outnumber millennials sometime around the end of this year. And they’re different from their predecessors in a number of important ways. One fact about Generation Z that companies who seek to appeal to them must remember centres around the convergence of demographic and economic trends: China has an enormous number of this generation (although that’s partly down to the simple fact that it’s the world’s most populous country – it also has a huge number of millennials), and, as the shift of economic power continues from west to east, it will become the most important economy in the world in the coming decades.
In other words: China’s Generation Z will one day be the most important single group of consumers in the world. That’s a compelling reason to start paying attention to them now.
Working in tandem with data provider Viga, global strategy consulting firm OC&C has recently released a report on Generation Z. A Generation Without Borders surveyed 15,500 respondents from nine countries (Brazil, China, France, Germany, Italy, Poland, Turkey, the UK and the US), and found some interesting points of difference between the generation as a whole and its members in China.
First of all, Chinese members of Generation Z save far less than their global counterparts. This could be a reflection of the one-child policy – in China, each member of Generation Z is growing up without siblings, meaning there’s no other kids for the family to spend on. They’re also extremely optimistic about the future. All that spending isn’t undertaken lightly, though – Chinese members of Generation Z place a heavy premium on quality.
In two ways, however, Generation Z actually furthers trends we’re already seeing in the Millennial Generation: a trend towards experiences over objects, and a keen sense of social responsibility. In regards to both of these areas, Chinese members of the generation are even more focussed on these areas than their global counterparts.
Dominion holds a number of companies in its Global Trends Luxury Fund that are focussed on Chinese members of Generation Z, including companies in a wide variety of industries, from luxury beverages, to computer games, to fashion, and more.
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