9 months ago
Gen Z Tightens Holiday Spending Amid Financial Pressures
Gen Z, which includes teens to people in their late 20s, is spending less money on gifts and other holiday expenses this year.
Many in this group are facing higher costs for housing, student loans, and groceries, which is making it harder for them to spend as much as they used to.
Some are even making homemade gifts or buying secondhand items to save money.
Retailers are noticing this change and are trying to attract younger shoppers by offering more affordable products.
Overall, while some shoppers are still spending, those with lower incomes and younger shoppers are feeling the pinch the most.
Gen Z is cutting holiday spending by an average of 34%, more than any other age group.
Rising costs of housing, student loans, and groceries are contributing to financial strain.
Retailers like Best Buy and e.l.f. Beauty are adapting by offering more affordable products.
Gen Z shoppers are turning to homemade gifts and secondhand items to save money.
Black Friday sales hit $18 billion, up 3% from last year, but shoppers bought 2% fewer items.
- Who
- Generation Z (teens to late-20-somethings)
- What
- Cutting holiday spending by 34% due to financial pressures
- Where
- United States
- When
- Year-end holiday season
- Why
- Rising costs of housing, student loans, groceries, and higher unemployment rates among recent college graduates
Key facts
- Generation Z
- Teens to late-20-somethings
- Expected Spending Cut
- 34%
- Black Friday Sales
- Items Purchased
- 2% fewer
- Average Price Increase
- 7%
- Gen Z's Share of Retail Spending
- 8% (expected to grow to 20% in 5 years)
- Unemployment Rate for Recent Graduates
- 6.8% (highest in a decade outside pandemic)
Quotes
Sonia Iacoboni
A 25-year-old sales-account executive from Long Island
“My bank account is certainly not where it once was. So it will be, you know, a lighter Christmas for me.”
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“I just know I want it to not be a lot.”
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Ali Furman
PwC’s head of U.S. consumer markets
“Even if it’s not your stated demographic or your desired demographic, you still have to pay attention to this generation because of the influence that they’re having.”
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Corie Barry
Chief Executive of Best Buy
“We’re actually indexing more into lower-income and younger, so to me that reflects the fact that the strategy for us is really positioning us well.”
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Mandy Fields
Finance chief of e.l.f. Beauty
“They don’t have to go out and spend $30 on a lipstick. That is one thing I think Gen Z loves.”
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Ajay Gopal
Chief financial officer at The RealReal
“It was, ‘Oh, my God, you’re going to give me something that somebody’s worn before?’”
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Mia Chai
A 23-year-old working in financial communications in New York City
“Us saying ‘handmade’ is managing expectations.”
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