Here’s how Gen Z consumer preference reshapes APAC’s marketing landscape

Gen Z consumers are observed to purchase based on pleasure and purpose, whilst being conscious of cost and convenience.

By 2025, Gen Zs will account for a quarter of Asia Pacific’s consumer base, overtaking millennials as the largest generation globally. This milestone signals a transformative shift in consumer behaviour throughout the region.

According to Euromonitor International, a market research provider, Gen Zs will see a growth of 135% in average gross income during 2023-2040. In 2023, the consumer segment contributed a global consumer expenditure of US$4.4t (SG$5.95t).

“Gen Z consumers form over 23% of the total population in Asia Pacific. While most of them are now aged between 14 and 29 years, online engagement, content creation, and e-commerce have amplified their impact in shaping consumer perceptions about brands and products, as well as influencing purchase behaviour in households,” Rabia Yasmeen, senior consultant at Euromonitor International, told Singapore Business Review.

As Gen Zs are highly immersed in online engagement, they make for important subjects to retailers and e-commerce players as they drive innovation and future strategies.

“This consumer segment, while highly vigilant of online scams, is actively engaged in social commerce and emerging technologies,” Yasmeen said.

In this fast-paced and highly digital world, Gen Zs also show a strong preference for convenience and straightforwardness, to improve their “complicated lives” and achieve “high aspirations for success and satisfaction.”

For instance, according to Mintel Global Consumer research, 77% of Singaporean Gen Zs (aged 18-24) say they are prepared to pay more for things that make their lives easier.

“Consider the close attention they ‘need’ to pay to how they’re presented to the world, from taking care of their bodies to eating nutritiously, [to] wearing clothes, accessories, [and] shoes that help them express themselves and feel confident. That’s just the aspect of physical and psychological well-being,” Joey Khong, trends analyst for Southeast Asia at Mintel, said in an interview.

“Items with a straightforward value and address all the applicable factors most important to them, from durability and versatility to inclusivity and environmental consciousness, rarity, pop cultural relevance, etc… will have the most appeal,” Khong told Singapore Business Review.

Strategies

Being advocates of self-expression, Gen Zs are known for actively putting out social media content on their product and service experiences.

“[This] trend has manifested as a larger ‘TikTok Economy’ in Asia, where viral trends and content generated by users on the platform has boosted sales for brands without any brand input… Trends with hashtags such as #kbeauty and #Asianskincare,” Jana Rude, senior insight manager for Consumers at Euromonitor International, said.

“What’s particularly fascinating is the expanding reach of these posts, as they now actively promote these products beyond their traditional markets and into other regions,” she added.

In the Euromonitor International’s Voice of the Consumer: Digital Survey, nearly 44% of consumers in Asia Pacific said they bought goods or services on social media platforms in 2023, up from 36% in 2022. About 41% of them did so after seeing a company or brand advertisement on social media platforms in 2023, up from 38% in 2022.

This surge in e-commerce is bolstered by influencer marketing, providing broad consumer reach at lower costs, and thereby driving brand growth.

“Gen Z values authenticity and peer recommendations. Prioritising video-centric social media platforms like TikTok, known for user-generated content, is a way to optimise marketing strategies, [and] can achieve higher reach with Gen Z. User-generated content also provides social proof and fosters a sense of community, making them more likely to trust and engage with your brand,” Rude said.

Brands and retailers are increasingly adapting to this trend by continuously collaborating or exploring collaborations with nano and micro-influencers to promote products. Influencers have proven to be an effective marketing tool, with over 46% of goods or services being purchased after consumers see an influencer's review or post about them.

Rude explained that Gen Zs trusts real customers more than paid spokespeople [and] influencers provide genuine reviews and recommendations, influencing purchasing decisions based on relatability and authenticity.

Supporting this narrative, Khong said: “Today, information [finds its] way to the light quicker than ever. Peer reviews are brutally honest and unethical practices, when uncovered, are quickly called out and distributed.”

As TikTok has proven to be an excellent marketing platform, many other social media platforms have adopted similar features, such as “Reels” on Instagram and Facebook, offering short-form video content that is most popular amongst the Gen Z.

“Gen Z has short attention spans and prefers visual content. Short videos are more likely to capture their interest and drive engagement, especially when combined with authenticity and creativity,” Euromonitor’s Rude said.
 
Values

Gen Z consumerism is deeply rooted in values and principles. This generation is captivated by brands and products that not only create “relatable” marketing content, but also champion the same values and principles they strongly believe in.

For example, data from Euromonitor revealed that in Singapore, 22.4% of Gen Z consumers feel that they can make a difference through their choices and actions whilst nearly 52% want to be active in a community important to them.

Also, 49.5% of Gen Z consumers in Singapore want to engage with brands to influence product innovation.

In terms of social responsibility, Gen Zs may show conflicting interests driven by costs. As reported on Euromonitor’s 2023 Voice of the Consumer: Sustainability Survey, despite the Gen Z’s concern over climate change most Gen Z consumers were reluctant to pay a premium for products with sustainable attributes such as “sustainably produced or raised,” “100% organic,” or “environmentally conscious or eco-friendly.”

With costs and sustainability being key concerns for Gen Zs, re-commerce has emerged — creating opportunities for the resale market on online platforms.

To address the concerns on premiums, Yasmeen suggested: “[As] Gen Zs are belief-driven and seek to support brands that align with their values, demonstrating social responsibility can attract Gen Z consumers who are willing to pay more for sustainable products and ethical practices. Empowerment helps with the value-action gap in environmental and social responsibility.”

Apart from buying pre-loved items to lessen costs, Gen Zs also opt for “dupes” of products that are normally expensive or out of their budgets.

“Here’s where ‘dupes’ come in: If their quality is just as good as the real thing, there’s no more shame to it — use it, embrace it even. For many things, brand matters to them less than quality. They’ll willingly cut back on many areas to spend on the brands and things that truly bring them joy,” Khong said.

Purchasing habits

Whilst Gen Z consumers display a sense of purpose and financial caution when purchasing products, they can also be impulsive, and purchase solely for pleasure.

“Gen Z consumers [display] polarity in their behaviour. Not only does gen Z rely heavily on technology, but they also hold a deep awareness of the adverse tech effects on health and privacy. Likewise, while many prioritise saving and hold a conscious approach to spending, they also tend to splurge on products and services where they find value and joy,” Yasmeen said.

Citing Euromonitor’s Voice of the Consumer: Lifestyles Survey in 2023, 30.5% of Gen Z regularly buy small treats, and 19.7% often make impulse purchases.

“Balancing polarised Gen Z’s spending behaviour requires adopting a dual mindset. Zennials are primarily rational and cautious spenders. But, at the same time, this generation indulges themselves more than other cohorts. They prefer rational indulgences – small-size, impulsive gratification,” she added.

Despite their preference to “live in the moment” and indulge impulsively, Gen Zs remain pragmatic, prioritizing “quality” and “finding bargains” as top shopping features, according to Euromonitor’s Voice of the Consumer: Lifestyles Survey in 2023. Over the year, the Gen Z’s average income increased by only 1% in real terms, leading 64.6% of this cohort to express concern about their financial situation.

As a result, this generation thinks over and researches even small indulgences. For brands showcasing trendy but affordable choices and emphasising the balance between budget-conscious choices and occasional splurges are strategies to consider. Brands such as Uniqlo, known for its affordable yet stylish clothing, exemplify this strategy.

Khong added that brands should also consider “creating experiences that bring joy, curiosity, and intrigue.” he continued, “It’s often observed how Gen Zs don’t like being sold to [or] prefer authentic interactions over overt sales pitches. [So,] they’re looking for new experiences and opportunities to broaden their horizons and deepen their understanding of topics they’re interested in.

“For example, Gentle Monster offers creative art installations in-store with its eyewear offerings. This unique approach redefines the luxury eyewear experience, offering consumers something new and captivating. Fun individuals do fun things, wear fun things, and are seen at fun places. This is where the elements of aesthetics, personalisation, and the disruption of conventions can thrive,” he said.

To capitalise on this behavioural trend, Yasmeen recommended that brands provide convenience features such as bundles, subscriptions, express checkout, and free shipping, given Gen Z’s emphasis on convenience, discounts, and value for money. Communicating the benefits and value proposition of products can also appeal to their desire for practicality and affordability.