Generation Alpha, children born from 2010 and onwards, is already having a significant influence in the retail industry. This generation, with the oldest just entering teenage years, sets apart from others with unique beliefs, values, and behaviours that will soon transform how retailers operate.
To ensure a successful future, retailers must adapt to Generation Alpha’s preferences such as advanced technology, sustainability, and a seamless integration of shopping channels with personalization being a crucial aspect. By aligning new strategies with the transforming needs of shoppers, retailers will be able to remain competitive – if not, retailers will simply become irrelevant. Graham Heuman, retail insights lead at JC Williams Group, discusses in depth about Generation Alpha, what they are looking for, and challenges for retailers as the demographic becomes closer to working and shopping independently.
“Generation Alpha has always had access to advanced technology, making them incredibly skilled at navigating digital platforms. They expect seamless integration between online and offline experiences and have a strong preference for personalized interactions. Retailers who fail to meet these expectations risk becoming obsolete in a rapidly evolving market,” says Heuman.
Understanding Generation Alpha
As understanding Generation Alpha is necessary for future growth in retail, the JC Williams Group is collaborating with consulting firms globally to gain research into the next generation. Partners from North America, Europe, South Africa, and Asia are collaborating on this research project, which will be conducted through a survey that has yet to begin. Heuman says the company aims to gather data that will help retailers innovate for the digitally savvy and sustainability-focused generation. Since the JC Williams Group cannot directly reach the target demographic, parents will complete the surveys.
“By targeting parents in our surveys, we aim to capture an accurate picture of Generation Alpha’s preferences and behaviours. We believe that by examining the preferences and behaviours of this generation, we can offer valuable data to help retailers stay in the market,” says Heuman. “Our research to date that has been done in our participating countries have all been desk work on the demographic breakdown as well as a little bit of the psychographic and how they behave in their respective countries. Countries have given a little bit of perspective on their countries Generation Alpha’s makeup, behaviour, and shopping trends.”
Generation Alpha’s shopping behaviours
Generation Alpha is already influencing the shopping behaviours of their parents and will be shaping future retail trends.
Heuman says currently, the generation’s influence is through their parents’ shopping habits – which also indicates these shopping trends are also persistent with older generations and are not solely on Generation Alpha. Along with parents staying updated on trends, Heuman says this generation is also influencing parents.
“We are seeing that they are already influencing their parents. We are seeing it in some interesting ways, which is a bit different from past generations. Generation Alpha has a large influence on entertainment choices, the types of food and delivery services their family uses, the technology they adapt at home, and hygiene products. Their focus on health, wellness, and sustainability is guiding their parents’ purchasing decisions significantly.”
Technology integration
Generation Alpha will be demanding retailers to integrate technology more extensively. Heuman says retailers must adapt by using artificial intelligence and machine learning to enhance shopping experiences and to provide in-depth personalization: “They expect a seamless integration between online and offline experiences and have a strong preference for personalized interactions.”
Social media involvement
This group is using social media starting at a younger age, unlike previous generations, and make shopping decisions on recommendations from people online.
To keep up with this demand Heuman says as Generation Alpha spends a significant amount of time online, retailers must start interacting more with consumers on social media such as YouTube, TikTok, and Instagram.
“They are used to creating these relationships through technology and are comfortable with never meeting people. They may develop friendships online or relationships in the future as well, so what it kind of means for retailers and how this all translates to shopping behaviours, is the first would be channel agnostic.”
Saying no to fast fashion
Heuman says Generation Alpha cares more about quality and sustainability than fast fashion, leading consumers to support brands that prioritize high-quality, eco-friendly products designed to last.
“So when we are talking about the values and opinions on things like this, there is a huge push from this generation into climate consciousness and they are also really focused on health and wellness. There is also a lot of focus on mental health, which I would all call that sort of just the sustainability of humanity, trying to reverse the damage of past generations. Because of this, there is more of a focus on quality products rather than frequency and fast fashion.”
From this increasing trend, Heuman says consumers will see more retailers leaning towards second-hand clothing options: I think we are going to see some new revenue savings going into that and then retailers are recapturing a lot of that revenue they would be losing through the Facebook Marketplace and the Kijijis of the world.”
Expecting seamless channel integration
As Generation Alpha has grown up with technology in their hands, this group will not separate online and offline shopping channels – they will expect a seamless integration: “They want to shop whenever and wherever they want. If it is in-store, if it is online, they are going to be channel agnostic.”
To ensure retailers keep up with these demands, Heuman says retailers must pay closer attention to the emerging shopping behaviours of Generation Alpha – something most retailers have not placed enough emphasis on. By keeping up with new technologies available, engaging more on social media, marketing with influencers, focusing on sustainability, and providing a seamless omnichannel experience, retailers can meet Generation Alpha’s expectations and continue to grow brand loyalty.
“When we are talking about the digital side of Generation Alpha, because they are already born into it, they do not have the same hesitancy that previous generations have had towards advanced technology,” says Heuman. “So I think retailers have a really great opportunity with this generation, as they are coming into the purchasing ages, to be able to make tech integration that other generations may have shied away from slightly, but Generation Alpha is already seen adept with that and are willing to adopt technologies.”
Are retailers behind?
As Generation Alpha is only a couple of years away from working and as they continue to mature, their influence in retail will continue to grow. Heuman says retailers who have not already transitioned, are behind and need to prepare now to adapt to the generation’s needs and preferences.
To stay on top of the next generation entering into the workforce soon, retailers need to adapt to new technologies quickly, stay updated on consumer values such as sustainability, and continue to evolve products to be more durable and sustainable.
Heuman says embracing technological innovation, sustainability, personalization, and social media engagement will be key to meeting the expectations of Generation Alpha and maintaining their loyalty for the future.
“Retailers need to start thinking about this generation today. The fact is, strategy takes time but also the oldest of these kids in all the countries we have covered are only about a year away from working. They are going to have purchasing power within the next year and a half. I think the first step is for retailers to start thinking about this generation, because a lot of them are not even on their radar yet.”
Stay tuned for a follow up article on the survey results of JC Williams Group’s research which will provide a more in-depth look on what Generation Alpha is looking for and how they will influence the retail landscape moving forward.
