With Gen Z in Canada starting to come of age, our spending power is already significant, and brands should start to better understand our needs.
Defined as those born between 1996 and 2012, Generation Z now commands $143 billion in buying power according to a January 2018 white paper “The Power of Gen Z Influence” by Barkley US.
Often, THINK GEN Z is frequently asked by companies why they should be targeting Gen Z and how much is our generation really spending? With a lack of Canadian data on Gen Z, we thought we would look to our neighbours south of the border to help monetize this amount. To help brands gain perspective on the significance of our generation's spending power, we applied some of Barkley findings to our own stats in Canada.
According to Statistics Canada, there are 6.8 million Canadians born between (1996 and 2012) compared to 62.8 million in the United States from USDA data. This means that the Gen Z cohort in Canada is 10.8% of the size of that in the United States.
As a rough estimate, if 62.8 million Gen Z spend $143 billion in the US then 6.8 million Gen Z would spend one-tenth (or 10.8%) in Canada equating $15.4 billion/year.
An important side note, this estimate is based on what Gen Z is directly spending their own money on. This figure does not take into account the big influence that we have over our families or household total spend.
In Barkley’s 2018 white paper, they conservatively used the assumption that Gen Z influences 50% of their household spending on food, apparel, and services in their estimate.
In a recent poll of our Think Gen Z Network, 81% cited that they significantly influence their family’s spending, especially in the food, personal care, household goods categories.
Barkley’s white paper estimates that combined direct and indirect spending for Gen Z in the US is $333 billion. If we once again apply our quick formula that would mean that Gen Z direct and indirect spending power in Canada is approximately $36 billion.
Businesses need to realize that each year, approximately 400,000 Canadian Gen Z’eds will be joining the workforce and you will see our spending power continue to grow exponentially.
Is your business ready to capture a share of the Canadian Gen Z wallet? Need help learning about our post-Millennial generation's unique consumer buying behaviour and what makes us different from previous generations?
Contact THINK GEN Z today at info@ThinkGenZ.com to help increase your bottom line.