Gen Z is set to outpace the earnings of Millennials by 2031. With economic unpredictability, worsening recessions, and multiple struggles at home and abroad, you may see that the youth and young adults born between 1995 and 2010 seem more prepared to excel financially – even more so than previous generations.
Despite having more experience in the workforce, Millennials are predicted to be left behind by a significant margin. As a result of this change in scenery, brands looking to delve into the serious spending power of Gen Z will need to identify and oblige to their interests.
There are a few questions that should be asked at this point. Does Gen Z relate to brands differently than Millennials? Are there specific factors that explain the financial success of Gen Z? And how should brands go about this? I’ll explain.
By 2031, Gen Z’s income will increase 5X (500%). This drastic rise in earnings will see this generation of workers surpass the income of Millennials.
Many experts predict that Gen Z’s income will account for one-quarter of all global income. If present trends continue, this will lead to Gen Z contributing a staggering $2 trillion to total global earnings.
This data is crucial because Gen Z has tremendous spending power, which means significant things for businesses looking for consumers. Family members spend $143 billion, and an additional $127 billion, on Gen Z every year.
Members of this generation also seem effective at swaying family spending, particularly in markets relating to fashion, popular culture, recreation and travel, food and beverages, and household items.
Unsurprisingly, Gen Z has even been influenced by technology and corporate presence throughout the years. The onset of social media and immersive technology has conditioned them to appreciate technology, brands, and large corporations with clear utility or social preference.
Gen Z’s inclination to trust is also apparent in how they research products, as 65% will investigate a product’s origins before purchasing it. Generation Z will also go above and beyond to support brands that they perceive as being sustainable and ethical.
If they are additionally set to become the top-earning generation in the world, the influence of their spending power will be too grand to resist.