Digital natives from the Gen Z generation are still inclined towards a physical retail experience, provided that it is delivered with a right mix of experiences.
Often defined as those born in 1995 and later, Gen Z is the demographic that is now coming of age. According to a Bloomberg analysis on UN data, Gen Z will comprise 32% of the global population of 7.7 billion in 2019. That represents a significant consumer segment, which, coupled with its growing spending power, will likely make an impact on many markets around the world.
While Gen Z are regarded as eager adopters of new technology and natural online shoppers, their purchasing behaviours reveal a different story. A study from the National Retail Federation and IBM’s Institute for Business Value released last year shows that three times as many Gen Zers shop in-store than online.
However, more than two-thirds of Gen Zers use their phones in-store to search for potential purchases. Their preference for experiential shopping and online referencing is already having a profound effect on the retail landscape. Retailers start to focus more on the social needs of consumers and the O2O experience, giving rise to the popularity of pop-up stores.
Pop-ups and Gen Z
It is easy to explain why pop-up stores are a hit with the Gen Z. As its name suggests, pop-up stores are temporary and therefore creates a fear of missing out (FOMO). In the age of social sharing, pop-up stores that are most popular with the Gen Z are designed with Instagrammable spaces. The set-ups are also often designed to create unique and memorable experiences.
Below are examples of a few successful pop-up stores that further illustrate its appeal among the Gen Z.
Balancing O2O experience is key
Amazon’s fashion pop-up store set up in central London last year experimented with a couple of O2O methods. The store setting serves as a communication platform where visitors participated in a questionnaire on the stock, prices and in-store experience.
Meanwhile, the O2O components allowed consumers to scan the barcodes on the high-end fashion items with a mobile app, purchase the goods in-store or use in-store tablets for home delivery orders.
The concept followed the design of its Black Friday pop-up earlier which had the store decorated like a house with shoppers browsing in the ‘house’ and purchasing items by scanning the barcode with their phones. Quirky and functional activations like these have proven to be massively popular with young shoppers.
FOMO is a powerful motivator
The LINE FRIENDS’ pop-up store in Los Angeles last summer, its first in the US west coast, leveraged on FOMO by first announcing its opening on the social media. The approach subsequently generated 1,500 fans on its accounts before the opening, and later 15,000 visitors shortly after the opening.
Creating engagement and sharing
Amazon China commemorated World Book Day last year with a pop-up event designed with four themed areas at a Beijing shopping mall. The interactive area with the 3D photo wall turned out to be the most popular among the 40,000 visitors throughout the six-day event.
The photo wall was a successful initiative by the retailer to help shoppers feel involved. More importantly, it was a platform for them to create their own experiences that can be shared with their social circle.