Gen Z customers approach sales associates less than millennials in travel retail stores, according to the latest research from leading agency, m1nd-set, which is focusing on what separates purchasing behaviour between generations for a new study.
Only 38% of Gen Z customers say they engage with sales associates; 30% lower than millennials, 68% of whom interact with store staff.
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The two-month study, which also compares the shopper behaviour with the average across all age groups, reveals that the tendency to engage with sales associates is above average among millennials, as 65% of travellers from all age groups interact with sales staff, according to the m1nd-set research.
The impact of the interaction is also lower among Gen Z shoppers. More than eight out of ten shoppers among millennials and all age groups combined report a positive outcome following the interaction, while only 67% of Gen Z shoppers said they purchased a product thanks to the interaction.
Another significant difference in shopper behaviour can be seen in how Gen Zs and millennials react to communications touch points. More than half of millennials (55%) notice touch points prior to their purchase in GTR when travelling; above the total for all passengers, which is just below half, at 47%.
This contrasts significantly with the behaviour among Gen Zs, as only 15% of this younger generation say they noticed touch points prior to purchase. This indicates the generational behaviour differences in general regarding how and where the various age groups source and digest their information.
Peter Mohn, Owner & Chief Executive Officer at m1nd-set, explained: “It is extremely important for travel retail marketers marketing to millennials and Gen Z travelling consumers to understand where to reach their target audiences when they are not travelling.
“For both these age segments, it’s clearly online where they can be found but among Gen Zs it’s most commonly on the mobile and via certain social media services.
”Platforms such as TikTok have to be integral to the marketing mix for marketers who are intent on reaching Gen Z shoppers while Millennials are more prone to be across multiple platforms such as Facebook, Instagram and Twitter.”
Average spend is another area where m1nd-set reports considerable differences between millennials and Gen Z consumers in travel retail. Spend among both age segments is significantly lower than the average among all age groups which is US$101.
For millennials, average spend is $70, with the highest spend allocated to the Electronics category at $124, followed by Jewellery & Watches at $118 and Fashion & Accessories at $98. Average spend in Travel Retail among Gen Z shoppers is considerably lower at $44, with the highest spend being allocated to Perfumes with $111, Electronics, $103 and Alcohol, $61.
One of the major differences is the overall spend among both age groups. Whether in domestic or travel retail, millennials represent a higher proportion of the overall consumer spend. Both generations combined currently represent just over 30% of total retail spend, but this share is set to increase to 48% by the end of the decade.
In travel retail, the spend is currently 6% among Gen Z consumers and 25% among Millennials. According to m1nd-set the Millennials’ share of spend in travel retail will increase by only a few percentage points by the end of the decade while the growth in spend by 2030 among Gen Zs consumers is expected to be more than threefold.
Mohn added: “Although a sizeable proportion of the Gen Z consumer generation is still below 18 and whose purchasing power barely surpasses their parents’ allowance, the potential among this generation – both as future customers and disruptors – is not to be underestimated.
“Both millennials and Gen Zs have a strong tendency to favour sustainable practices when shopping in travel retail.
“While they are keen on championing brands with a strong social and environmental impact and story, they are equally intent on shouting out on social media about less virtuous brands and will be quick to name shame companies and brands which do not demonstrate ethical and environmentally friendly practices. This is particularly true among Gen Zs.”
More information on m1nd-set’s research and consultancy services can be obtained from m1nd-set by writing to [email protected].