Gen Z Consumer analysis: Tokyo, Japan and New Delhi, India

Consumer Analysis Within the Tokyo, Japan and New Delhi, India Market

18004196 BA Fashion Marketing Year 2 Researching Consumer Behaviour and Psychology Word Count: 4,194 1

Executive Summary

Gen Z in Tokyo, Japan Japan is considered to have the oldest population in the world with a median age of 48.4 (Worldmeter,2020). However, Tokyo, known as the Japanese street style capital, is known for its youthful population and culture. As the generational categories in Japan are defined differently, Generation Z is considered to be a part of the ‘Satori Generation”, meaning the enlightened generation. Furthermore,

Meet Woke Gen Z

this cohort is not homogeneous in any way, being deeply divided into six segments. A majority of woke

Generation Z is a cohort that is the most racially and ethnically diverse generation in history. These digital natives grew up with technology and have very little recollection of a world without smartphones.

Gen Z falls into three of these segments: brand-conscious followers, premium shopaholics, and value researchers.

Furthermore, due to the technology in their lives, they are on track to also be the smartest and best educated generation in history.

Gen Z in New Delhi, India

In terms of political activism, this generation is not sitting on the sidelines. They are constantly pushing the government to fix social and economic issues while showing their activism through organizing mass protests and voicing their opinion on social media. As this generation is highly connected, they are more aware and educated on social issues around the world. However, this generation is deployed divided into two categories: Gen We vs. Gen We.

India, unlike Japan, is considered to be the youngest population in the world with an average age of 26.8 (Worldmeter,2010). New Delhi, is a key pillar within the fashion industry, has become a prime location for luxury malls and retailers such as Uniqlo, GAP, and Ralph Lauren. 27.5 million of this cohort call New Delhi home. This generation places a high emphasis on image and social status, which show through their shopping habits of buying luxury items moreover seeing them as an investment. Furthermore, this group, who prefers to shop in physical retailers, wants a retail experience tailored specifically to them and are not persuaded to make a purchase by ads.

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Meet Woke Generation Z Generation Z, a cohort born between 1995 and 2010, is the youngest, most ethnically-diverse and largest generation in history; compromising for more than one-third of the global population (Deloitte, 2019). It is crucial to understand that although this cohort has some similar characteristics among them, they are a deeply divided group that can be categorized into two segments: ‘Gen Me’ and ‘Gen We’. Gen, Me is a highly visible and researched group that is currently being targeted by the majority of fast fashion brands. This cohort is cultivated by aspirational lifestyles portrayed by high-profile influencers while following mass trends and ‘hype culture’. On the other hand, Gen We are a cohort that takes a more unfiltered approach to life while being extremely politically active. Another alias for this group would be ‘Woke Gen Z’, the cohort that we will be analyzed within this report.

Woke Gen Z is a group that is highly ambitious and goal-oriented while focusing on collective progression rather than individual success.

Subsequently, growing up in a global recession has caused this cohort to value safety and financial security with many turning to entrepreneurship and other resourceful ways to support themselves.

According to the 2017-2018 Global Entrepreneurship Report, almost two-thirds of Gen Z stated that they

(Generation Z Instagram Survey, 2020)

plan on starting their own business in the future (Babson, 2018).

Furthermore, this is a highly socially conscious generation, prioritizing mental health, sustainability, equality, and safety. This consciousness plays out as political activism through not only social media but offline as well.

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(Generation Z Instagram Survey, 2020)

Tokyo, Japan Woke Generation Z

Tokyo Population Total - 37.8 Million Gen Z - 12.4 Million

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COUNTRY PROFILE Japan has a population of 126.6 million with a decreasing growth rate of -0.2% annually. The Japanese population is essentially the oldest in the world, with a medium age of 48.4 years old in 2020.

Japan is also one of the most densely populated countries in the world, with 91.8% of its population living in urban cities (CIA.gov, 2021).

(Amazing Japan, n.d.)

Tokyo specifically, makes up for 37.8 million of the total Japanese population and a nominal GDP of $1.8 billion USD. The immediate threat to the current Tokyo economic growth is the COVID-19 pandemic which has affected tourism, international exports, and forced the postponing of the highly anticipated 2020 Tokyo Olympic Games.

If the pandemic is not contained by 2021, the local

culture, influencing global fashion trends.

This unique city is able to combine the past, present, and future in all its art forms. The textile and manufacturing industry employs 431,000 employees with world famous brands emerging from this culture such as Comme des Garcons and Bape.

economy will suffer greatly, as JPY1.35 trillion ($12.6 billion USD) has already been spent in preparation for the Olympics (Global Data, 2020).

Tokyo is considered the Japanese street style capital, known for its vibrant and youthful fashion

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Political

Japan is a constitutional monarchy in which the Emperor Naruhito plays a ceremonial role.

All political power is vested in parliament, with an election every three years.

Japan has recently been negotiating a large-scale free trade agreement, known as the Trans-Pacific Partnership (TPP), with 11 nations.

In 2019, Japan ran into disputes due to a South Korean court ruling that ordered Japanese companies to compensate South Korean wartime labour. Japan considered this move unjustified and

Economic

Manufacturing contributes to 19.2% of GDP in Japan and employs 16.6% of the workforce (Japan Country Profile, 2020).

The Tokyo Metropolitan area contributed approximately 35.3% to the nation GDP in 2019, having expanded 1.6% since the previous year. This is essentially due to an increase in business investments, public spending, and a well performing labor market.

The immediate threat to the current Tokyo economic growth is the COVID-19 pandemic which has affected tourism, international exports, and forced the postponing of the highly anticipated 2020 Tokyo Olympic Games. If the pandemic is not contained by 2021, the local economy will suffer greatly, as JPY1.35 trillion ($12.6 billion USD) has already been spent in preparation for the Olympics.

Social

Due to migration from surrounding cities, Tokyo has experienced a population growth 0.3% over the previous five years (2015-2019) Japan has been suffering a decline in birth rates with an continuously aging population.

Between 2015 and 2019, the old-age population increased by 2.7% while the young-age population declined at an annual rate of 0.3% and the working aged population declined at a rate of 0.5% at the same time.

Technological

Japan has always been an early adopter and leading innovator within the technology sector.

At the heart of this is Tokyo, ranking number two in the Innovation Cities Index 2019, launching the world’s first banked-backed cryptocurrency exchange (VCTRADE), and its implementation of the 2020 Tokyo Smart City Development Plan.

Japan has one of the fastest evolving digital markets In the world. The overall Japanese internet penetration rate reached 93.5% as of June 2019

Legal

According to the OECD, in 2018, Japan’s total tax wedge was lower than the OECD average; standing at 32.6% of the total labour cost.

On the Economic Freedom Index of 2019, Japan had a score of 72.1 out of 100. This ranks Japan as the 30th freest economy out of 180 nations in the world. An overall score is well above the world and regional average.

Japan is an average performer in terms of product market regulation (PMR), with a PMR indicator of 1.44 in 2018. This easing of regulations indicates an attractive landscape for investments in various sectors while opening up avenues of employment.

The Tokyo Metropolitan Assembly (Tokyo’s governing authority) is implementing, in 2020, a four year plan created in 2016 called “New Tokyo. New Tomorrow. The Action Plan for 2020” This plan will essentially aims to turn Tokyo into a sustainable and smart city Japan is the seventh largest emitter of greenhouse gasses however, during the first six months of 2020, the nation’s CO2 and energy emissions have dropped by 7.5% compared to the previous year.

Japan was an early adopter of the Ecological Footprint concept Prime minister, Yoshihide Suga, has pledged to cut Japan’s greenhouse gas emissions to net-zero by 2050 in his first policy address to parliament.

Japan signed the Paris Agreement, dedicated to fighting climate change and mitigating green house gas emissions.

The GDP of Tokyo Metropolitan area is forecasted to reach JPY210.0 trillion ($ 2.2 trillion USD) by 2025

(Global Data, 2021) 9

Environmental

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(Vogue, 2019)

Generation Z Japan is considered to be home to the oldest population

more realistic, conservative, and tend to be risk-

in the world, with only 11.4% (United Nations, 2021)

averse. Along with this, there is a diminished sense of

fitting into the Generation Z category. Within Japan, the

desire for materialistic items among this cohort while

categories of generations are relatively different than in

shunning excessive cultural expectations.

western psychology, with a more specific approach that is largely based on changes in macro-economic trends over

There are five main aspects that are associated with

time. Categorized as the ‘Satori’ (enlightened) generation,

the social behaviour this specific cohort: advocating

this is a cohort of individuals born from 1997 onward

for gender equality, accepting diverse presentations

who have achieved a sense of enlightenment (Francis,

of gender, taking an alternative stance on social

2019). Parallel to the Generation Z cohort described by

activism, prioritising cost performance and placing

western countries, this generation is tech-savvy having

less emphasis on romantic relationships.

been exposed to technology their entire lives. However, unlike their western counterparts, this generation is

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Consumer Lifestyle & Identity According to McKinsey, the Gen Z cohort in Japan can be segmented into six categories: brandconscious followers, premium shopaholics, ethical confidence, value researchers, quality-conscious independents, and disengaged conformists. A majority of this cohort fall into the classifications of brand-conscious followers, premium shopaholics, and value researchers. This speaks to how nonhomogeneous this cohort is.

Brand conscious followers make up the largest

between wanting to fit in and wanting to stand out,

segment of the Japanese Gen Z cohort, at 24 per cent.

causing them to look for brands that are both popular

This consumer is not necessarily loyal to any specific

but have certain items that allow them to show their

brands, they prefer variety and follow trends closely.

unique style. This cohort is also the most likely to feel

Furthermore, they do not necessarily love shopping

a sense of achievement and recognition through

either, in Japan more than half of this segment stated

social media. This cohort would be a target for high-

that they hate shopping but 57% stated that being

end brands as they are more willing to pay extra to

on-trend is important for them. This trait essentially

get what they want. Brands should essentially provide

manifests into this cohort finding more efficient ways

convincing stories as to why their products or services

of shopping such as buying online. For brands, this

deserve to cost more.

(McKinsey, 2020)

Cultural Norms Based on Hofstede’s six cultural

best (masculine)

versus enjoying

events such as weddings or funerals,

dimensions, Japan ranks highest

what you do (feminine).In terms of

what people wear and how they

uncertainty avoidance, Japan is one

behave is prescribed in great detail by

to

of the highest-ranked in the world.

etiquette books (Country Comparison

this

This can be due to its ecological

- Hofstede Insights, 2021) .

indicates that the Japanese society is

climate being constantly threatened

driven by competition, achievement,

by

and success. This is essentially a

forcing the Japanese to learn ways

value system that starts in school

to prepare themselves for uncertain

and continues through professional

situations. This plays out not only for

life. Fundamentally what sets this

emergency preparation but drives

apart

society

a culture of maximum predictability

is what motivates the Japanese

with highly ritualized lifestyles. For

people; which is wanting to be the

example, during important social

in

masculinity

and

avoidance.

When

masculinity

on

it

uncertainty comes

segment being the largest one makes them a key resource. They tend to be early adopters of not only new

Value researchers have the highest degree of brand

products but new services and experiences. However,

loyalty. 80% of Japanese respondents prefer to choose

they are a tough audience to achieve loyalty from, as

brands that they are familiar with over a new product.

they do prefer variety, as stated.

However, this is not blind loyalty, as a majority of them

this

scale,

natural

disasters

essentially

will research for the best deals online before buying.

Premium shopaholics love to shop. They take the

Due to their cautious is crucial for brands that are

time to do research online and compare brands or

targeting this group to put more effort into their sales

items. Two-thirds of this cohort are also willing to pay a

promotions and customer-relationship-management.

from

a

‘feminine’

premium to get exactly what they want when they can afford to. Additionally, this group is stuck in a parallel (Country Comparison - Hofstede Insights, 2021)

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Online Shopping Behaviour

Technology

Overall, Japan places fourth in the world for the total size of retail e-commerce. According to the IMRG (Interactive Media in Retail Group), the e-commerce sector in Japan is expected to grow on an average of six per-cent annually between 2018 and 2022. Du to the COVID-19 outbreak, there has been a spike in motivation to shop

1 As

this

generation,

globally,

online as people are spending more time in their homes. Within the category of e-commerce, retail

are

is at the forefront of this dynamic expansion, due

digital natives; the Japanese cohort

to retailer strong commitment to developing both

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is no different. They rely on the digital

mobile commerce and e-commerce capabilities;

world for learning, shopping, and

targeting the younger consumer.

entertainment. Across Japan, almost

Leading

e-commerce platforms within this market are

one-third of Gen Zers spend six hours

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or longer a day on their phones.

Amazon, Rakuten, and Yahoo.

However, along with this, they do (Passport, 2020)

hold the belief that society spends too much time on their phone and that

In-store Shopping Behaviour

technology gets in the way of social

What Social Media is Used For

relationships. 75 per cent of Japanese Gen Z believe that people overshare

Although e-commerce is gaining popularity within Japan, Generation Z continues to prefer the brick and mortar shopping

on social media and 49 per cent

experience. Due to this, many online stores, such as Net-A-

(Mckinsey, 2020) are concerned about

Porter, have a hard time finding success in Japan as the reach

the use of their personal data. Due to

of departments stores stands at 70%, well above the reach of

this, they carefully manage their online

e-commerce websites at 27% (McKinsey, 2017). This could be

identities and what people or brands

due to the cultures already exquisite experiential and social

they interact with digitally.

retail landscape. According to Consumer Overview in Japan

by Passport, Generation Zers top motivations to shop in-store include wanting to see the item before buying it and the ability to make an immediate purchase.

(Passport, 2020)

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Psychographics

Political Activism As Japan lowered the voting age from 20 to 18 in 2015, there has been a spike in youth involvement within the political realm. According to data from the House of Chancellor’s election in 2016, the voting turnout of 18-year-olds was 51%; supporting the countries right-leaning liberal Democratic party. The most pressing political issue gen Z in Japan are focusing on would be advocating for gender equality. Various social movements such as #WeToo and #KuToo have proven that this cohort, like many globally, believe men and women should have the same opporunities whether that be in the home or workplace.

In retrospect, this generation in Japan is less politically active than Gen Z in other parts of the world. They tend to avoid political protest and shy away from sharing their political opinions on the streets, which could be due to the more conservative nature of the Japanese culture. Instead, they prefer to take to social media to share their opinions and demonstrate support for various political movements.

Shopping Behaviour Although the overall shopping behaviour of the Japanese Gen Z consumer is more conservative than the rest of the global cohort, with less frequent purchases, they still value following trends and can sometimes be likely to make impulse purchases. When it comes to shopping, this cohort has relatively specific needs that will make or break their buying decision, these include: relevance and speed, a balance between quality and price, video marketing on social media, sustainable yet affordable, and a value proposition that is localized

(Fineboys, 2014)

Maslow’s Hierarchy of Needs is quite different in an Asian context, where interpersonal relationships and social interactions are more valued, on average than individual self-

Shopping Attitudes

actualization needs. In the Asian context, the need for self-actualization is replaced by social

Due to the COVID-19 outbreak, Japan consumers have been embracing e-commerce, however, they are not ready to give-

needs of status, admiration and affiliation. Autonomy and independence are not as important

up on store-based retailers. According to Passport, 36% of Gen Z like to shop in stores that create a unique experience, staying loyal to brick and mortar retailers that provide an innovative and immersive experience (Passport, 2020).

or at least do not have the same connotations as in the West.

Furthermore, 34% of this cohort stated that their preferred mode of shopping is visiting shopping malls (Passport, 2020).

The VALS framework (values, attitudes, and lifestyles), is a system to categorize consumers by

to cater to this group.

This essentially means that it is crucial for brands to find the balance between in-person and digital experiences in order

psychological and sociological theories. In Japan, their youth would fit into the category of ‘self-adaptors’. This essentially means that this cohort has a high level of self-expression and desire personalized experiences. Furthermore, they respond highly to fashionable display, social activities, daring ideas, and exciting, graphic entertainment (VALS™ | VALS™ Types |

Gen Z Decision Making Process

Experiencers | SBI, 2021).

Key Characteristics *

Prioritizing cost performance

*

Opting out of adulthood expectations

*

Taking an alternative stance on social activism

*

A heightened sense of realism

*

Advocating for gender equality

*

Romantic Resistance 17

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PRIMARY RESEARCH Survey Results “I prefer to shop in-store because it can feel more like fateful for each item compared to buying online.

Online shops can choose f rom a

Trends Discovered

huge amount of clothes while relax-

In-store Vs. Online

ing at home but that is indirect and I often feel regret. I want to buy something I wear for as long as possible so I want to actually touch and f it

Parallel to the secondary research con-

before getting them. There is a limit to see at the store but again that is

ducted, the survey found that Genera-

more like ‘meant to meet’ so I can

Ethical Consideration

Political Views:

love them more especially at vintage

tion Z continues to prefer shopping in-

Liberal with the most concern around

stores” (Generation Z Consumer in Japan, 2020).

store versus online. This is because they

All respondents stated that they aim to

social justice for all gender identities,

have more faith in a product when being

shop sustainably and are willing to spend

ages, and sexualities.

able to visually see it in person and try it

more on sustainable clothing, especially

on.

if they agree with the values of the com-

Most Used Platforms:

pany. It was mentioned that they also

“I’m bad at following the trends.

Trend Adaption

But I like to see the past magazine’s

prefer to shop for clothes that will last a

Pinterest

long time as throwing out clothing is not

Instagram

the preferred choice.

Top Buying Motivation:

street snap such as FRUiTS and Zipper so sometime my stylings are referenced f rom their styles(I

Most respondents stated that they do

think that is 1990~’s street snap at Harajuku” (Generation Z Consumer

Price

not actively follow trends due to wanting

in Japan, 2020).

to stick to their own style. Two respondents voiced that they mainly research trends of the past between the late 70s to 90s. This essentially speaks to the

“I do care about values and ethics matters when purchasing my favourite designs, I am willing to spend extra when it’s sustainable or when I agree on their values” (Generation Z Consumer in Japan, 2020).

high level of individualism and uniqueness that this cohort values.

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Favourite Item

Bought from Favourite Retail Store

Most Recent Purchase

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Bought But No Longer Like

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Customer Prof ile Sakura Takahashi 22 Years old Lives at home with parents in Tokyo Studies communications and media at the Tokyo Institute of Technology Works part-time at Uniqlo

“I am worried about climate change and try to make a positive impact on the environment”

Style: Minimalistic and chic, wears mostly neutral colours Activities: Socializing with f riends online and in person, Shopping, browsing online, studying, watching Tv, socializing with family Preferred shopping places: The mall, shopping centres, and online

“I do follow influencers, however, I am not necessarily influenced by their fashion”

Future work aspirations: to work abroad and f rom home, heaving a flexible work schedule Exercise: Prefers stress reductions activities such as yoga and meditation Favourite Brands: Vinted, Beams, Grapevine K3, Ganni, Zara

“I would be lost without Internet access”

Monthly clothing budget: 300 Yen

“I love trying new

Influencers followed: @asahisasaki, @hikari, @mademoiselle_ yulia

products and services”

Top Instagram Accounts: @songofstyle, @atmargueritestreet, @mikageshin_off icial,

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Consumer Insight “I prefer to shop in-store because it can feel more like fateful for each item compared to buying online.

* Prioritizing cost performance *

Taking an alternative stance on social activism *

Advocating for gender equality *

*

Romantic Resistance

Opting out of adulthood expectations *

A heightened sense of realism

Shopping Influences

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New Delhi, India Woke Generation Z

New Delhi Population Total - 19 Million Gen Z - 27.5 Million

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COUNTRY PROFILE India is a unique country with an economy constructed of traditional village farming and handcrafts adjacent to an ever-growing modern industry of mechanized agriculture and manufacturing. This country is made (KT759, n.d)

up of twenty-nine states and seven union territories, Is home to 19,500 dialects and languages and 1.3 billion people (India Populations (2020) - Worldmeter, 2020). India is considered to be one of the fastestgrowing economies in the world with a national GDP of 2.8 trillion USD, set to overtake the United States economy by 2030; however, due to the current Covid-19 Pandemic, this growth has slowed down. According to Passports India Country Profile, it is predicted that the real GDP of the Indian economy will regress to 13.6% in 2021 (Passport, 2020).

and accessories grew to make up 28% of all organised retail; ranking India at #2 on the 2019 Global Retail Development Index (Global Retail Index, 2019).

New Delhi specifically, being India’s capital, contributes approximately 121.5 billion USD to the Indian nominal GDP (Global Data, 2019).

The fashion industry plays a key role in India’s economy, with manufacturing providing work for approximately 35 million people (Eghbal, 2020). By 2022 it is projected that India’s apparel market will be worth 59.3 billion USD, making it the sixth-largest In the world (McKinsey & Company, 2019). Once the Indian government permitted overseas foreign investments in single-brand retailers in 2012, apparel

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This city offers a unique and diverse shopping experience due to its mix of international fashion brands, independent shops, luxury malls, street bazaars, designer boutiques, and state emporiums. New Delhi has become a prime location for international retailers, having witnessed the launch of global brands such as GAP, Uniqlo, H&M, Ralph Lauren, and Zara.

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Political

India is the largest global democracy The Citizenship Amendment Act of 2019 led to mass protests and violence in many regions of the country.

In 2019, the Indian government revoked autonomy to the regions Jammu and Kashmir, essentially weakening the already unstable relationship between India and Pakistan.

Economic

New Delhi accounted for 4.1% of the country’s GDP in 2019, with an economic expansion of 9.8%.

The total foreign domestic inflow (FDI) in the New Delhi region stood at $84.4 billion USD between 2000 and 2019 (Department for Promotion of Industry and Internal Trade | MoCI | GoI | Ministry of Commerce and Industry | GOI, 2020).

The GDP of New Delhi is predicted to grow, between 2020-2025, at an average annual rate of 10.7% due to government investments in infrastructure, banking, and financial service industries. However, due to the global pandemic, the overall Indian economy is expected to retract by 9.6% in 2021. (World Bank,2019) The unemployment in New Delhi is expected to increase to 2.1% by 2025 Corporate tax is the lowest in the world at 22% for existing countries and 15% for new manufacturing companies

(Global Data, 2021)

India’s key exports are petroleum products, jewellery, pharmaceutical products, transport equipment, machinery and readymade garments 31

Social

Technological

The total population of New Delhi, 19 million, accounts for 1.4% of India’s total population.

This is predicted to increase, between 2020 and 2025, at an annual rate of 1.3% reaching 20.5 million by 2025.

India is one of the fastestgrowing IT markets in the world while being the largest outsourcing destination for global IT. This country accounts for approximately 55% of the market share in 2017-18.

New Delhi is the only city in India with four universities, essentially attracting a younger population

The total number of internet users reached 560 million in 2019, with an internet penetration rate of 40.9% as of June 2019.

India is a multi-ethnic, multilingual, and multi-religious country.

India still suffers from poverty and according to the World Bank, 1 in 5 people in India are still poor (Poverty headcount ratio at national poverty lines (% of the population) - India | Data, 2020).

India has the largest population of social media users in the world, with 310 million Facebook users in 2020 (Statista, 2020)

Legal

India is a part of the International Labor Organization, which offers protections for employees including the Payment of Wages Act (1936), Employment Act of 1946, The Industrial Disputes Act of 1947, the Payment of Bonus act of 1965, and the Payment of Gratuity Act of 1972.

Due to the growth of foreign trade, the Indian government passed the Foreign Trade Act of 1992 in order to facilitate imports and exports.

In order to regulate foreign exchange transactions and investments abroad, India passed the Foreign Exchange Management Act of 1999 In 1995, India founded the World Trade Organization, updating business laws regarding copyright, patents, and trademarks to meet the Agreement on Trade-Related Aspects of Intellectual Property Right In 2012, India legalized foreign investment in retail, essentially attracting more investors to the India economy.

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Environmental

India is the world’s third-largest emitter of greenhouse gasses due to its large scale coal power plants and rice and cattle farms.

When signing the Paris Agreement in 2015, India pledged to reduce its greenhouse gas emissions 3035% by 2030. It also plans for 40% of electricity capacity to be renewable or nuclear by 2030.

In 2002, India hosted the UNFCCC (United Nations Framework Convention on Climate Change) in New Delhi, adopting the Delhi Ministerial Declaration promising to adopt the technology needed to cut greenhouse emissions.

(Cosmique Studio, n.d.)

Generation Z According to the latest United Nations figures,

2018 election (Beniwal and Pradhan, 2018).

India is home to the worlds largest youth

Much like many gen Z members globally,

populatio; with 27.5 million citizens under the

in India, this group is more critical of the

age of 25 (United Nations, 2021). Roughly 27% of

government

this population fits into the Generation Z cohort.

While they advocate for gender equality,

This cohort is pioneering a new way of life,

same-sex marriage, multi-faith marriage,

creating a new culture varied with modern and

and blurring religious, class, and community

traditional values. For example, many members

lines that uphold their current caste system;

belonging to this generation listen to Desi Hip

this generation still values various cultural

Hop, Hindu Rap, and modernized Bollywood

traditions. This includes continuing to have

anthems. Politically, this cohort is more involved

their parents approve potential spouses.

than

generations

before.

than their millennial predecessors, with over 130 million first time voters in India during the 33

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Consumer Lifestyle & Identity The Indian Gen Z consumer prefers to spend

New Delhi has met their lower-tiered needs

money

various

of psychological, safety, and love/ belonging

brands as well as seeking premium well-

needs, they are ready to move on to the

known branded items. They see this as an

needs associated with self-esteem In line

investment in their statue and image, as

with Maslow’s theory of human motivation,

they place importance on what others think

this consumer is in the stage of ‘Esteem’.

of them while furthermore being interested

Various

in the latest trends and styles. According

achieving this level of self-esteem including

to Maslow’s Hierarchy of Needs, a person

respect of others, internal acceptance,

does not feel a higher need until the needs

confidence, and achievement. With the

of their current level are satisfied. Within

relatively new rise of luxury shopping malls

the Indian retail landscape, this theory is

in New Delhi, this consumer can meet their

prevalent as consumerism is becoming a

external self-esteem needs by simply being

way of life for the Generation Z cohort. As

seen shopping there.

by

experimenting

with

this cohort within the urban environment of

components

are

involved

in

(Cosmique Studio, n.d.)

Cultural Norms

Culture

(Passport, 2020) 35

is

considered

an

distributed unequally” (Country

which can be due mostly to

external factor when it comes

Comparison

the

to consumer behaviour; with

Insights,

various cultural values having

score within this dimension

model, India can be described

a direct influence on buying

indicates an appreciation for

as

habits. Based on Hofstede’s six

a top-down societal structure

collectivist

cultural dimensions, India ranks

system. This essentially creates

characteristics. This can be

the highest in ‘power distance’.

a dependency on the boss or

reflected through Generation

This is defined as “ the extent

power holder for direction and

Z’s

to which the less powerful

purpose. On the other hand,

belonging and family values.

members of institutions and

India scored lowest within the

organizations within a country

indulgence category, meaning

expect and accept that power is

that it is a culture of restraint;

-

2021).

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Hofstede India’s

high

country’s

population.

a

largely

Based

country

high

and

value

on

with

rural this

both

individualist

of

social

Online Shopping Behaviour

Technology

Due to the COVID-19 pandemic, there has been a rise in the appetite for online shopping among the, not only among the generation Z cohort but the country as a whole. Online shopping rose to 64% from 46% over the past six months (Majority of Indian consumers may shift to online shopping in next 9 months:

1

Survey - ET Retail, 2020). Along with this the US, UK, and China are popular destinations for online shopping. This could be due to the lower cost of items

By

2030,

the

internet

will

be

from those China while on the other hand, the US and UK market attracts

democratized in India with more than

the more luxury customer. Top buying motivations

2

1 Billion Indian users. There are three

among the Generation Z cohort for shopping online

key enablers of this: the third wave of

include: finding the best price, certain items not

the telecommunication revolution, the

being available locally, and having the ability to

increase in internet users, and mobile-

3

first consumers. Currently, India has nearly

700

million

internet

compare prices, product information, and reviews.

The top used online shopping platforms

users

among the India youth are Amazon

across the country(Total internet users in India | Statista, 2021); indicating a

(Passport, 2020)

large market opportunity within the

What Social Media is Used For

digital space. With technology being at the forefront of Generations Z’s lives,

Retailing within India takes place predominantly in physical stores, 95% (Retail

they are the ones driving this digital transformation

within

the

in India: Interesting Facts and Emerging Trends | RE: Retail, 2020). This is

Indian

significantly due to consumers wanting the opportunity to touch their items

economy, making it one of the most

while also receiving instant gratification as shipping services in India are not

progressive countries in the world in

as advanced. The New Delhi Gen Z consumer does most of their shopping

adopting the technology. According to

the

TCS

Youth

Survey

In-store Shopping Behaviour

on the high streets and in shopping centres. As technology is a large part of

(2016),

this cohorts daily life, brick-and-mortar retailers are integrating the digital and

smartphones are the most common

physical experiences, attracting a consumer to visit not just to buy but to be

used among Indian yoth followed by

immersed into an entirely new dimension. Top motivations for this group to

laptops and personal computers.

buy in-store include avoiding shipping costs and to source new products or

37

(Passport, 2020)

trends.

38

Political Activism

Psychographics

This cohort is more politically conscious than their predecessors, advocating for stronger leadership in India void of corruption. This generations of political concerns would include employment issues, India-Pakistan tensions, gender equality, and environmental sustainability.

During the May 2019 election, there were approximately 130 million first-time voters in India, voting for concerns such as job creation and employment rates. Furthermore, due to the highly religious nature of this country, Gen Z has a mix of bother conservative and liberal attitudes with the majority voting for the Bharatiya Janata Party (BJP).

Women’s equality is one of the main concerns of India youth. The women’s movement has been witnessing a spike in engagement, advocating for reforming customary practices such as the ‘dowery system’ and the ‘triple talaq’

Shopping Behaviour As this cohort is not likely to be in the mindset of planning for the future, their shopping habits reflect a pattern of spending rather than saving. This is also heavily due to their concern of image, as they see shopping as an investment in their social status. Furthermore, they enthuastcially enjoy trying new products and exprimenting with various brands while actively seeking premium and well-known branded items. As this cohort places high importance on materialistic possessions, they are also likely to highly prioritise tailored cultural and personalised shopping experiences. Based on Consumer Types in India, 99% of respondents stated that they want products and services that are uniquely tailored to them (Passport, 2020). Furthermore, Indian Generation Z wants to engage with brands to influence product innovation and have are first when it comes to trying new products.

(Rawpixel, n.d)

Shopping Attitudes Values, Beliefs, and attitudes The VALS (values, attitudes, and lifestyles) framework is a system for grouping consumers according to psychological and sociological theories

As many Indian consumers are concerned about the impact of COVID-19 on their household incomes, they are becoming more cost-conscious when shopping, however, there is still a large demand for branded goods versus non-branded.

Based on the Indian Consumer Overview report by Passport, 71% of Generation Z respondent stated that they prefer

to predict their behaviour and buying decisions. When it comes to the Indian Gen Z

branded good, compared to 42% globally (Passport, 2020). Furthermore quality, safety, and trust have become more

consumer, a majority of this cohort falls into the category of ‘experiencer’ (Raj and

from companies or brands that they trust (Passport, 2020).

important when deciding which brands to purchase from; 78% of Generation Z respondents stated that they will only buy

Sait A K, 2015). The young and enthusiastic consumers within this segment thrive on variety and are motivated by self-expression. This need for self-expression is portrayed through their consumption habits such as spending heavily on clothing, fast food, and music

Gen Z Decision Making Process

Key Characteristics *

Wanting everything

*

Loving physical activity (are sensation seeking)

*

Being the first in and first out of trend

*

Seeing themselves as very sociable

adoption

*

Believing that friends are extremely important

*

Going against cultural expectations

*

Being spontaneous

*

Staying up to date on the latest fashions

*

Having a heightened sense of visual stimulation

39

(Passport, 2020) 40

PRIMARY RESEARCH Survey Results

“I prefer to shop in-store because I

In-store Vs. Online

Trends Discovered

have a great eye and enjoy f inding unique things.”

(Generation Z Consumer in India,

2020).

In

line

with

secondary

research

Ethical Consideration

Political Views:

conducted, this cohort prefers to shop

No strong political views other than not

in-store mainly due to the convenience of trying items on and f inding unique items. This could also be due to the cultural retail landscape in India being

Only one of the respondents stated

agreeing with the current government

that a companies ethics and values

of India

matter when they are deciding to make

Most Used Platforms:

a purchase. This shows how uniquely

dominated by physical retailers.

diverse this cohort is. One respondent

Pinterest

stated that her ethical shopping habits

Instagram

are dependant on her budget at the

Trend Adoption

Buying Motivation:

time due to being a university student.

“I do follow fashion trends if I

Price

absolutely love them” (Generation Z Consumer in India, 2020).

Both respondents stated that they do indeed follow trends but, only if they f it with their own personal style. This speaks to previous f indings surrounding

Whether the style suits them “I feel so much better when I buy something

sustainable

versus

when I buy fast fashion” (Generation Z Consumer in India, 2020).

this cohorts emphasis on image, the reason for following trends could be due to their want to f it in with society and stay relevant within fashion.

41

42

Favourite item

Recent Purchase

Describes my Style

Bought but No Longer Like

43

44

(Vogue, 2017.)

Customer Prof ile Sahana Agarwa 21 Years old Lives at home with parents in New Delhi Studies sociology at the University of Delhi

Style: simple and modern, sometimes including a statement piece Activities: Knitting, Photography, Traveling, Watching movies;/ TV, Connecting with f riends virtually

“I do follow influencers and I am influenced by their fashion”

Preferred shopping places: The mall, shopping centres, and online Future work aspirations: To work start my own business that allows me to make a positive change in the world

“Targeted ads based on my online activity invade my privacy”

Exercise: Prefers stress reductions activities such as running and yoga

“I would be lost without Internet access”

Favourite Brands: Yves Saint Laurent, Da Milano, Monte Carlo, Zara Monthly clothing budget: 29,902 Indian Rupee

“I love trying new

Influencers followed: @ juhigodambe, @thatbohogirl, @aashnashroff

products and services”

Top Instagram Accounts: @gianvitorossi, @studiohimaniarora, @priyankachopra

45

46

Consumer Insight “I prefer to shop in-store because it can feel more like fateful for each item compared to buying online.

* Wanting everything *

Being the first in and first out of trend adoption *

Going against the current mainstream

* *

Staying up to date on the latest fashions

Loving physical activity (are sensation seeking) *

*

Seeing themselves as very sociable

Believing that friends are extremely important

Shopping Influences

Mobile Shopping

47

Friends

Family

E-commerce

48

Company Ethics

Social Media

Japan: Generation Z Reccomendations * Prioritize cost performance *

Be fully transparent with ethical practices and company values * *

*

Offer immersive brand experiences

Allow customers to be apart of innovation processes Do not categorize this cohort into one category as they highly value individuality

*

Sell the brand through influencer marketing, not specific products

(Cosmique Studio, n.d.)

When marketing to Japanese youth, it is crucial to remember that this generation is not homogeneous. They are deeply divided and possess unique characteristics and world views that are related to the specific environment in which they grew up. When it comes to shopping preferences, this technologically advanced generation still prefers to shop in-store to be immersed in a brand’s full experience and culture. Furthermore, they are highly conscious of price and receiving value for their purchases so it is critical to provide a justification for higher-priced items.

Voices of East Anglia, n.d.

49

50

India: Generation Z Reccomendations * *

Sell experiences not products

Rethink influencer strategies to sell the brand not the products

*

Gain their trust through company transparency and a strong corporate social respondibility policies *

Place an emphasis on the in-store experience *

Integrate technology with physical retail

(Rawpixel, n.d)

India, considered to have the youngest population in the world, is home to 427 million of the Generation Z cohort. Within New Delhi, 27.5 million of this cohort reside. This consumer places high importance on experiences and image meaning that not only is merchandising and website layout important, but packaging as well. They enjoy trying new products and experimenting with different brands, both premium and high street. When it comes to influencing the cohort, it is important to keep in mind that they can spot inauthenticity and targeted ads from a mile away so, capturing this audience will demand making them feel as if you are talking directly to them.

51

52

(Rawpixel, n.d.)

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56

Appendix Tokyo, Japan Survey Answers: Participant A

Generation Z Instagram Survey Results

57

58

Tokyo, Japan Survey Answers: Participant B

59

Tokyo, Japan Survey Answers: Participant C

60

New Delhi, India Survey Answers: Participant A

61

New Delhi, India Survey Answers: Participant A

62

Tokyo, Japan Wardrobe Audit: Participant A New Delhi, IndiaWardrobe Audit: Participant A

Favourite Item Favourite Item

Bought from Favourite Retail Store

Most Recent Purchase

63

Recent Purchase

Describes my Style

Bought But No Longer Like

64

Bought but No Longer Like