A recent collaborative report by Snap Inc. and Boston Consulting Group revealed Gen Z's significant economic influence in India. With 377 million individuals born between 1997 and 2012, they currently drive $860 billion in spending, set to reach $2 trillion by 2035. Gen Z's sway spans various sectors, with 70% relying on peers for purchase guidance. Brands face a gap in engaging this demographic, as only 15% actively target Gen Z despite its projected pivotal role in India's economic growth.
A recent report unveiled on October 16, 2024, sheds light on the significant economic influence wielded by Generation Z in India. The study, titled "The $2 Trillion Opportunity: How Gen Z is Shaping the New India," was a collaborative effort between Snap Inc. and Boston Consulting Group (BCG).
The report underscores the remarkable impact of India's Generation Z, a cohort born between 1997 and 2012, which now numbers 377 million individuals—surpassing the entire population of the United States. These dynamic individuals are currently propelling $860 billion in consumer spending across diverse sectors, constituting 43% of India's overall consumption. Forecasting into 2035, the report anticipates Gen Z-driven expenditure to soar to $2 trillion, signifying that every other rupee spent in India will originate from a Gen Z consumer.
Noteworthy discoveries from the study include the following:
- Presently, one out of every four Gen Z members is part of the workforce, a figure expected to escalate to nearly one in two by 2035.
- Direct spending by Gen Z, stemming from their personal earnings, is poised to surge from $200 billion to $1.8 trillion by 2035.
- Gen Z exerts significant sway over various spending categories, influencing 50% of footwear purchases, 48% of dining out experiences, 48% of out-of-home entertainment choices, and 47% of fashion and lifestyle expenditures.
- A staggering 70% of Gen Z heavily rely on their close circle of friends and family for guidance on purchases and other decisions.
- Furthermore, 77% of Gen Z members find augmented reality and interactive visuals notably more engaging compared to prior generations.
The report additionally highlights distinctive shopping behaviors peculiar to Gen Z:
1. Emphasis on Trends: Gen Z is 1.7 times more inclined to prioritize trends over brand loyalty when shopping.
2. Visual Orientation: Nearly 80% of Gen Z individuals depend on images, GIFs, and immersive visuals for communication.
3. "Shopcializing": 64% engage in sharing shopping experiences with friends through photos or video calls.
4. Omnichannel Adoption: 54% are prone to checking wishlists or creator pages on their phones while shopping in physical stores.
5. Influence of Creators: 72% seek shopping inspiration from creators' social channels.
Despite the escalating influence of Gen Z, the report uncovers a considerable gap in how businesses are adapting. While 45% of surveyed brands acknowledge the potential of Gen Z, merely 15% are actively implementing strategies to engage this demographic.
Pulkit Trivedi, the Managing Director of Snap Inc. India, emphasized, "India's 377 million-strong Gen Z population will play a pivotal role in shaping the country's future growth over the next two decades. Gen Z is poised to be the primary driver of India's consumption surge, propelling $1.8 trillion in direct spending by 2035." Nimisha Jain, Senior Partner and Managing Director at BCG India, echoed this sentiment, stating, "For businesses, understanding and genuinely engaging with Gen Z isn't just advantageous; it's imperative for current success and future sustainability."
The report advocates five key strategies for brands to effectively connect with Gen Z:
1. Swift Innovation to Stay Aligned with Trends
2. Embed Social Interaction throughout the Shopping Experience
3. Offer Visually Immersive Experiences Online and Offline
4. Develop Seamless Omnichannel Purchase Paths
5. Collaborate with Influencers in a Meaningful Manner
This comprehensive study, drawing insights from surveys of 1,000 parents and 1,200 Gen Z and millennial respondents, furnishes invaluable guidance for businesses seeking to tap into the burgeoning economic prowess of India's largest generation.
Key Statistics:
- Gen Z population in India: 377 million
- Current Gen Z-driven consumer spending: $860 billion
- Predicted Gen Z-driven spending by 2035: $2 trillion
- Percentage of Gen Z in the workforce: 25% (present), 47% (by 2035)
- Percentage of brands actively targeting Gen Z: 15%
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