The summer is in full swing! We’re heading to the beach, to the pool, to the theme park! While most people assume that summer travelers are from one of the three main demographic groups – Millennials, Gen Xers and Baby Boomers – the marketing focus often lands on Millennials. That’s because this group is out of college, starting to make good money, starting families and working from anywhere in the world due to technological advances. They have more business travel opportunities than past generations thanks in large part to the internet and the ability to work from home or co-sharing spaces.
But there’s a new generational cohort about to burst on the scene with incredible potential spending power. These Gen Z children and young adults were born between 1995 and 2012 and are now aged roughly 7 to 23 years of age. They number about 67 million right now, just one million less than their elder brothers and sisters, the Millennial cohort. To predict the future, these are the kids we should be watching right now!
To put these numbers in perspective, let’s look at the updated infographic we do every year:
At the moment, totals by cohort are as follows:
- The Greatest Generation 27 Million
- Baby Boomers 73 Million
- Gen X 61 Million
- Millennials 68 Million
- Gen Z 67 Million
- Gen Alpha 20 Million
- Total 316 Million
The 67 million Gen Z generation has a powerful influence on the travel industry. In fact, one estimate puts the total spending power/influence of this generation at $143 billion.
How can these children and young adults have such influence on the travel industry? The reason they have such a strong grip is because their parents are principally Gen Xers. Gen Xers are 39 to 53 years of age and they were one of the groups that was hit hardest by the current recession. In addition, they were around when the internet became available to all and they saw how this force is affecting every aspect of live, work and play space. As such, they focused their parenting on two very important topics: money and technology. Due to the recession, they taught their children the importance of budgeting and saving money, and they also equipped them with cutting-edge iphones, ipads, and other electronics.
A few years ago, we posted a blog about Gen Z. At the time, this young generation had been labeled with terms such as “short attention span,” “easily bored,” and “not very focused.” We pointed out how this generation was actually the best of all generations at not only multi-tasking, but the ability to process a huge amount of information very quickly. This is key in how Gen Z makes decisions today, and it is by curating this information that they affect summer family travel.
Gen X parents want their children to have influence on family travel and as such, parents are letting Gen Zers make the bookings for summer vacation activities. The Gen Z generation then uses all of the information at their disposal to find budget-friendly “experiences” that they can all enjoy together. Not only does this take the pressure off parents, but it also guarantees that the family will have fun while on vacation together. To sum it up, Gen Zer’s have learned to be “fiscally responsible” and they want to get as much for their money as they can get, which the internet allows them to do.
As background, here are some statistics from a research group studying the behavior of these young people, GenZInsights.com.
What technologies Gen Z are using:
- 97.6% of Gen Zers own a smartphone across North America, Europe, Australia and New Zealand.
- Nearly one quarter (22%) of Gen Zers use their smartphones 10+ hours per day.
- 74% of Gen Zers prefer spending time online.
- 31% of Gen Zers don’t feel comfortable without having their phone for “30 minutes or less.”
- Of all the social media platforms available to them, the Gen Z generation prefers Snapchat and Instagram as their main social media sites.
- 58% of Gen Zers don’t trust Facebook with their personal data.
- 94% own a laptop.
- 44.2% own a tablet.
- 36.9% own a gaming console.
- 30% own a desktop computer.
- 66% of Gen Zers report using more than one digital device simultaneously.
- 78% will entrust certain apps — though not all — to access their geo-locale.
- 60% of Gen Zers won’t use a website or app that’s too slow to load.
- 62% won’t use a website or app that’s hard to navigate.
- 73% of Gen Zers use their smartphones to text and chat with one another.
When they are living their lives or on vacation, here is how they shop:
- 41% of Gen Zers will read at least five online reviews before making a purchase.
- Only 15% of Gen Zers see themselves as shopping exclusively online in the future; 77% see themselves shopping at stores with an omnichannel presence.
- 70% of Gen Zers report exerting an influence on their families’ purchasing decisions.
- 46% of Gen Zers follow more than 10 social media influencers.
- 52% of Gen Zers are keeping track of at least three brands on social media.
- Gen Zers prefer following brands on Instagram to Facebook by a 250-percent factor.
- Gen Z prefers following brands on Instagram twice as much as Millennials.
- 70% of Gen Z remain consistently loyal to the brand of smartphone they purchase.
- 59% of Gen Zers show regular brand loyalty when it comes to electronics overall.
- 65% of Gen Z shoppers want “real value” for their money — and are more inclined to purchase when offered coupons, incentives or a rewards program.
- 56% stress the need for shopping experiences to “not be boring.”
- 46% say the recommendations of friends and family members play a significant part in making their financial decisions.
- When traveling, 58% of Gen Zers would rather stay at hotels than either AirBnb or vacation rentals.
In another survey by New Horizons that included 57,000 responses from 188 countries, we found some interesting infographics about where and why Gen Z’s spend their money. The following infographic presents what they want to spend money on while on vacation:
In the next table, you can see how Gen Z’s in the 18 to 23 age group are internally/socially focused while traveling, slightly more so than the Millennial group.
This up and coming group will force us to innovate in the shopping and traveling experiences we offer. What are you doing to connect with these young people? Let’s start a dialogue and develop some new third places and vacation locales geared with Gen Z in mind.