The retail industry is experiencing a significant consumer-driven transformation, with Gen Z now with significant buying power and Gen Alpha emerging as the future customer base for all brands. It’s therefore crucial for senior commerce leaders to adjust their strategies in order to capture the next generation’s attention and spending power effectively.

VML’s forthcoming consumer trend report, ‘Trailblazers of Tomorrow’, looks at the ways Gen Alpa (6-16 year olds) is beginning to rewrite the commerce rulebook. We recently invited 20 digital leaders to join us for an exlusive breakfast and a sneak-peak into the themes and insights that this report reveals.

The following is a roundup of some of the morning’s key topics:

Omni-Channel and Digital Shopping

Future of commerce presentation with hugh

The initial hypothesis of the ‘Trailblazers’ report was that Gen Alpha would primarily favour digital shopping experiences. However, the findings revealed a nuanced reality and a surprising trend emerged: a higher percentage of Gen Alpha expressed their desire for in-person shopping compared to online shopping. This pattern persisted across different age groups, with those aged 17 to 44 and individuals aged 45 and above also showing a preference for physical stores. Interestingly, this preference for both online and in-person shopping experiences was consistent across the 18 countries we surveyed, not just limited to the UK.

Furthermore, when consumers were asked where they envisioned themselves shopping in the next decade, physical stores emerged as the top choice, except among 17 to 24-year-olds who favoured social commerce. This underscores the complexity of modern consumer behaviour, with individuals indicating a desire to engage with multiple shopping channels.

However, this presents significant challenges for businesses aiming to provide seamless omni-channel experiences. While many digital business leaders acknowledge the importance of adopting multi-channel strategies, nearly half express concerns about the sheer number of channels available. Additionally, consumers expect these experiences to be frictionless, seamlessly transitioning between channels where they are recognised and treated as individuals.

So, while Gen Alpha undoubtedly embraces digital technology, they also demonstrate a (perhaps unexpected) preference for omni-channel shopping experiences. This poses substantial challenges for designers and businesses alike as they navigate the evolving landscape of consumer behaviour.

Brands, Purpose and Sustainability

The significance of brands remains strong among consumers, with 14% considering them very important and only 3% dismissing them entirely. Those favouring brands that mean something to them transcends generations, with 49% of all consumers valuing companies with a meaningful purpose.

However, when assessing purchasing habits, other factors such as price, availability, and delivery speed take precedence over brand purpose and reputation. Gen Alpha, for example, has high expectations for rapid delivery, with 29% demanding deliveries within one to two days.

It’s apparent that brands must offer more than mere reputation to remain relevant, underscoring the importance of comprehensive service offerings and ethical engagement to meet consumer expectations.

The Rise of Social Commerce, Influencers and Influencer-Led Brands

Panel discussion at the future of commerce breakfast

On average, people spend approximately 2.39 hours daily on social media, with 17 to 24-year-olds leading at 3.8 hours; a significant time investment.

Interestingly, Gen Alpha favours TikTok, while Gen Z individuals prefer Facebook for their initial purchases. Despite this, social media’s importance is steadily growing, with more users actually purchasing via social channels. However, these still only account for about 5% of purchases.

Yet, the trend toward influencer-driven brands is notable, with 41% of shoppers anticipating increased utilisation of social media by brands. Gen Alpha, in particular, is poised to invest in brands championed by influencers and streamers. Social media’s influence is undeniable, with integration challenges being the primary hurdle. Once resolved, social media’s impact on consumer behaviour is expected to escalate.

Digitisation and New Channels

One intriguing finding from the research is the growing acceptance and reliance on voice technology. Over the past few years, there has been a significant shift in people’s comfort levels with voice interfaces, as demonstrated the increasing integration of voice assistants into daily activities.

Nearly a quarter of individuals surveyed claim they cannot imagine life without smart assistants like Alexa, with Gen Alpha showing an even higher affinity at 34%.

Gaming habits also reveal interesting insights, particularly in the UK, where 41% of gamers view their avatars as integral to their identity. This importance placed on gaming personas is consistent across age groups, indicating a widespread virtual cultural shift.

With Gen Alpha still in their teens, the impact of their influence on the future of shopping remains to be seen. However, it’s clear that their decision making is largely driven by influence and experience, whether that’s virtual, digital or instore. However that experience manifests itself, it needs to be personalised and frictionless. Retailers and brands should be planning now for this generation to really exert their spending power with transformative effect.

You can download the full version of the report here or get in touch with us today to transform your omni-channel strategy.

Please provide your contact information to continue.

Before submitting your information, please read our Privacy Policy as it contains detailed information on the processing of your personal data and how we use it.