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How Gen Z spending habits have defied the global economic crisis

by Danny Lee
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    Surprisingly, students have continued to spend despite the outbreak of COVID-19. But how and where exactly have they been spending? UNiDAYS analyzed activity of over 1 million students on our app to answer exactly that. 

    Across the world, economies have suffered, lives have been altered, and plans have come to a standstill as a result of the spread of COVID-19. As such, it’d be reasonable to assume that student spending has also come to a halt—but that’s not been the case at all. 

    Instead, activity on the UNiDAYS app proves that student spending has actually increased as a result of COVID-19. To find out more, we analyzed spend activity across four major verticals—fashion, tech, beauty, and health/fitness—to drill down into the details of how Gen Z spending habits have changed due to COVID-19.

    Let’s dive in.

     

     

    To get the full picture of how and to where Gen Z spending habits have shifted as a result of COVID-19, download our free research report.

     

     

    Why have we seen such a huge uptick in Gen Z spending habits?

    One idea is that a large number of students chose to move home, back to parents, and out of dorms. Which for many, means they no longer need to buy groceries or general household items, leaving a larger sum of disposable income for shopping. This could explain why 72% of students* say they’ve been shopping more since the pandemic struck.

    *Source: Dig In

    Another reason for having more disposable income? The complete lack of anything else to do. While some people have been taking the time to exercise more (one area we’ve seen a massive increase in spending), others have been baking, renovating homes, or simply taking some time out with Netflix—and who could blame them?

    A closer look at health & fitness spending tells us that average order value has increased by over 70% between March 1st and May 31st compared to the same time last year.* 

    *Source: UNiDAYS: Analyzing Gen Z Spending Habits Before and During COVID-19

     

    So, other than keeping fit, what else have students been up to?

    While the increase in health and fitness spending nod toward the idea that a lot of students have dedicated this time to self-care, the increase in spending on skincare products only works to further prove that idea. 

    Sales of skincare products have more than doubled, up 118% versus pre-COVID levels, with make-up and accessories also seeing over 50% growth.* 

    Whether it’s a genuine interest in tech, or if tech is something that’s helped to remedy the boredom of being stuck at home, we’ve seen a spike in sales here too, with total sales increasing by 15%* during the pandemic. 

    *Source: UNiDAYS: Analyzing Gen Z Spending Habits Before and During COVID-19

     

    So, what’s the ‘new normal’ when it comes to Gen Z spending habits?

    It's too soon to tell. What we’re yet to see is whether or not these new shopping habits will be kept up by Zs after the pandemic dies down. Or, whether these ‘unprecedented times’ have had an unprecedented lasting effect on the habits of this generation.

    Research suggests that the desire to shop online may drop once people feel it’s safe enough to go back to stores en masse. Before the crisis, research told us that only 26% of students preferred to shop in-store. However, that number has risen to a staggering 60%—though this could just be a result of people wanting what they can’t have.

    *Source: Dig In

    In all likelihood, many of our habits will revert back to the ‘old normal’. But until people feel completely comfortable venturing out into public spaces—and it could be quite some time until that happens—this world of online shopping and staying home is our ‘new normal’.

    Get the full picture of how Gen Z spending habits have changed as a result of COVID-19. Download our report, Analyzing Gen Z Spending Habits Before and During COVID-19, and you’ll discover exactly where and how Zs are spending their precious time and money these days.

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