As we head back to work this fall, including the first Gen Z college grads to join the workforce, the largest consumer group in history is heading back to school. And on their way back to school, their spending will be the second biggest shopping season of the year. The National Retail Federation estimates that back-to-school spending will reach $83.6 billion this year, up over 10% versus year ago.
The group within this cohort to watch closely are the back-to-college Gen Z – they account for 20% of their cohort and will be responsible for two-thirds of total back to school spending. These back-to-college Gen Z students are buying more and shopping in more places than their younger brothers and sisters. College-bound spending alone is expected to reach $54.1 billion this year, up 12% from year ago. That’s $54.1 billion in back-to-school college spending – more than Mother’s Day, Father’s Day and Halloween combined.
What they’re buying
The Gen Z college crowd is buying a lot more than just school supplies. They are starting to outfit not only their backpacks but their living spaces. In fact, school supplies don’t make it into their top five categories. They’re buying school supplies, and college-branded gear, but according to Retail Dive, the top five categories of spend for Gen Z college students are electronics, clothing, food, dorm and apartment furnishings and personal care items. This group, on the verge of entering the workforce, is getting their first experiences at setting up households and having fun making those independent purchases for the first time. Get to know their lifestyle and buying choices now to be prepared to reach them as they move up, move out, and move on.
Where they’re shopping
The top five places college-bound Gen Z students are shopping this year are online, mass merchandisers, discount, department stores (the only one of the five channels declining), and college bookstores. They’re shopping in greater numbers than they were last year, and don’t mind buying ahead and returning what they don’t need later. Where you won’t find many Gen Z doing their back-to-college shopping: drug stores, specialty shops, and catalogs. To reach these shoppers, you need to be where they are, providing the kind of shopping experience they value.
Their buying power
Gen Z college students have access to more funds, with fewer budgetary restrictions, than any previous generations and are fast becoming the next big wave of spenders. Are you ready for them?