Feb. 14, 2019 – Leading global payments provider, Klarna, released new research into consumers’ shopper behavior – specifically amongst the Gen Z and Millennial generations. The research surveyed more than 1000 consumers, finding that consumers of all ages value seamless, personalized, and flexible shopping experiences.
Millennials And Gen Z Are Spending Big Online
Today, U.S. shoppers admit to buying clothes and accessories online an average of 10 times a year. For Gen Z shoppers, aged 16-24, this number increases to 18 times per year, with nearly a quarter (23%) of them admitting to shopping online 1-3 times per month. Millennials are shown to shop online 14 times per year and the 55+ age group, 8 times per year.
The outside world might tell us that the fashion industry is driven by celebs, influencers, and high end fashion, but the average American shopper is more likely to be influenced by items reaching the end of their life-span or seasonal sales. Men are frugal spenders, with two-thirds (60%) saying they are most likely to buy new clothes when an old item wears out – compared to 52% of women. U.S. shoppers also buy new clothes when there are seasonal sales (44%) and big events like a wedding (30%).
High fashion and celebs don’t have as much influence as the industry might think; only 2% say they’ll buy clothes because a celeb/influencer has worn it. This outlook differs for younger shoppers where social-influenced spending is key. For the ‘want it now’ Gen Z generation, 25% say they are most influenced to buy when they see an item trending which is likely to sell out and 26% when they’ve seen something on social media.
Online Consumers Demand Smooth & Seamless Shopping
Customers demand a simplified and smooth online experience. Not having a standout online/mobile browser, free/simple returns, and/or a seamless checkout experience will damage retailers’ bottom lines. The top reasons for U.S. shoppers abandoning a purchase online are that the retailer does not have a decent returns policy (36%) and the checkout process took too long (31%).
Over two-thirds (66%) say a free and easy returns policy is one of the top 2 aspects that would improve the experience and 53% said a slow and expensive returns process would stop them from shopping with a retailer again. A flawed website functionality would also prohibit 61% of shoppers from repeat visit/purchase.
Letting Customers Try Before They Buy Could Encourage Higher Online Spending
Although shoppers are making purchase decisions online, they still miss being able to touch, feel, and see the product before buying. Almost half (46%) of U.S. shoppers say they like to touch and try items before they buy them, so they will tend to buy more expensive items in store. A third (29%) of shoppers prefer to browse for a new purchase online and then actually buy it in store. Enter the solution: sitting room to fitting room experiences – using solutions like deferred payment or Pay Later to help shoppers see their items before buying.
Payment Flexibility Removes Limitations for Luxury-Loving Consumers
U.S. consumers favor luxury and high-end items, but are often limited based on price point. Having more flexible payment methods would allow them to make these purchases. Nearly a quarter of shoppers (23%) say they have to save for several months before purchasing costly goods. This is highest amongst Gen Z and Millennials at 35% and 30% respectively.
22% of shoppers say they struggle to afford the latest trends and would like an option to pay in installments or pay later – increasing to 37% for Gen Z and 30% for Millennials. A third said having the option to pay for their online purchases in four equal payments would help them better manage their finances and a quarter (24%) said it would mean they could buy more high-end products they couldn’t usually afford. A fifth (21%) said it would allow them to ultimately spend more.
Bricks And Clicks
73% of consumers think that shopping in-store offers a human experience that can’t be replicated online. However, over half miss the personalized offers and discount codes they receive online and 55% think that shopping online is more convenient. Consumers want to bring some of the human touches to online shopping – 34% want online chats so they can speak directly with a representative about an item before buying.
Online Retailers Look To The Future
49% of shoppers want technology that takes their measurements so they can be sure something will fit before buying. Nearly a quarter (24%) want augmented or virtual reality components – the ability to see items without trying them on (this number rises to 40% for Gen Z). 26% of shoppers want smart mirrors that make recommendations on what to buy based on what you try on. Ethics are important too – 21% of U.S. consumers want tracking tech so they can see where their item came from and if it is ethically produced.
For more information, visit www.klarna.com.
It’s all about smoooth (yes, with 3 ooo’s). Klarna is Europe’s leading payments provider and a newly-licensed bank, which wants to revolutionize the payment experience for shoppers and merchants alike. Founded in Stockholm, Sweden, in 2005, the fintech unicorn gives online consumers the option to pay now, pay later or over time – offering a trusted, frictionless and smoooth checkout experience. Klarna now works with 100,000 merchants to offer payment solutions to users across Europe and North America. Klarna has 2,000 employees and is active in 14 countries. www.klarna.com.
More news from Klarna
Klarna and Shopify further strengthen global partnership
Enabling SME merchants in Germany to effectively compete and grow by automatically enabling Klarna payment methods through Shopify Payments
Powerhouse Arcadia become one of the first fashion retailers to model Klarna’s new Slice it in 3 in the UK
Retail trailblazers Arcadia have today announced the launch of Klarna’s newest payments product — Slice it in 3 — across all brands.
Superdry lets shoppers “Klarna it” with latest payments partnership in the US & UK
Klarna continues rapid global growth through latest partnership with fashion superpower Superdry and world leading payment platform Adyen