Mumbai: India’s Gen Z, with a staggering population of 377 million, is the largest generation in the country and a force to reckon with in the consumer market. According to a recent report by Snap Inc. and Boston Consulting Group (BCG), this generation has a collective spending power of USD 860 billion, accounting for 43 per cent of India’s total consumer expenditure. This makes Gen Z a critical driver of the Indian economy, influencing a wide array of industries, from fashion to technology.
The report, which surveyed 1,000 parents and 1,200 Gen Zs across India, provides insights into the purchasing habits and trends of this generation. Nimisha Jain, Senior Partner and Managing Director at BCG India, highlighted the significance of Gen Z’s contribution, stating that they make up 43 per cent of total consumer spending in India.
Key Areas of Gen Z Spending
Gen Z in India tends to splurge on diverse categories, with a significant focus on fashion, technology, and cars. Unlike previous generations, Gen Z’s unique preferences in fashion, coupled with their strong affinity for the latest technology, sets them apart as trendsetters. Additionally, food and social activities make up a large part of their spending, reflecting their inclination towards experiences and lifestyle-driven purchases.
The report breaks down Gen Z’s expenditure into direct and indirect spending. Direct spending refers to money spent by Gen Zs who are financially independent, while indirect spending pertains to those reliant on parental support. Notably, one in four Gen Zs is currently employed, contributing approximately USD 200 billion of the total USD 860 billion. As more Gen Zs enter the workforce, this figure is expected to rise to USD 250 billion, with half of the generation working.
Future Projections
Looking ahead, the report forecasts that by 2035, Gen Z’s collective spending will reach an astonishing USD 1.8 trillion, suggesting that every second rupee spent in India will come from a Gen Z consumer. This monumental growth underscores the importance of understanding and catering to this generation’s needs and preferences.
Opportunities for Brands
Despite Gen Z’s growing influence, many brands have yet to tap into their full potential. According to Nimisha Jain, while Indian and international companies are aware of Gen Z’s impact on the market, less than 15 per cent of brands are actively leveraging this generation’s purchasing power.
For businesses, the opportunity to engage with Gen Z is immense. This generation spends more than Millennials or their parents did at the same age and is set to outspend all previous generations on consumer products. From technology and cars to fashion, Gen Zs in India are reshaping the way industries operate, providing unprecedented opportunities for companies to boost their sales and market share.
