Consumer shopping preferences often mirror bigger themes at play, whether that’s conversations around the environment and sustainability or budget concerns and cost-of-living constraints. Often, these preferences and non-negotiables change from generation to generation and depend on the product category. For Gen Z and millennial shoppers, quality, sustainability and security are front of mind, particularly when buying jewellery and other luxury items. This begs the question – what should merchants be doing to cater to these preferences in order to stay ahead of their competitors?
Gen Z and millennials: driving the shift to accessible luxury
According to our latest data at Tink, Gen Z and millennials are purchasing the largest share of luxury items – averaging 16 and 14 items per year, respectively. These findings demonstrate a significant opportunity for high-end and luxury merchants to tailor their services to those who use them most.
Part of this is by noting their shopping habits – many millennials are in their peak earning years, and Gen Z are an emerging spending powerhouse*. Ignoring the growing influence of these demographics is a missed opportunity, as they are increasingly becoming the heart of the luxury market.
It’s vital to meet customers’ expectations and demands—especially in a competitive market where they’re looking for a special, bespoke experience. For example, cost-of-living pressures mean that consumers are being more discerning with their luxury purchases and are opting for products that combine quality with ethical production. Our research found that around three-quarters (73%) of millennials and 64% of Gen Z want to invest more in quality purchases that will last – that’s a lot. These generations are driving the shift to accessible luxury, prioritising quality and seamless shopping experiences from start to finish.
Security and trust are the bare minimum
Of course, luxury items like jewellery and other accessories are defined by their high quality and ethical production. But luxury extends beyond the physical item itself and covers the whole buying experience. Consumers want reassurance that their investment is both secure and going to the right place, rather than spending frivolously without confidence in the transaction.
Our research found that the majority of Gen Z and millennial consumers are willing to pay more for a trusted brand’s reputation. In a world where we are increasingly shopping online and it’s easier for newer brands to be present, consumers think twice about where they’re buying from and take a more considered approach, particularly when it’s a bigger purchase. This includes prioritising a seamless and secure payment experience.
Payment failure and fraud is a barrier for shoppers
Consumer apprehension around security for high-value purchase translates into hesitation at the checkout. For over half of the Gen Z (56%) and millennials (52%) shopping for higher-priced goods, there is a reluctance to make high-value online purchases due to a fear of payment failure and fraud. Ultimately, consumers don’t want the hassle of finding a product that they like and want to invest in only to be met with payment difficulties, or worse, falling victim to fraud.
Consumers want peace of mind when it comes to these kinds of purchases, and without secure and seamless payments, even the best product can be overshadowed by checkout concerns. To meet these expectations and to keep customers coming back time and time again, merchants need to enhance their payment systems.
Enter Pay by Bank
New and innovative payment methods like Pay by Bank offer a secure and trusted checkout option. In the fast-moving world of digital commerce, consumers need reliable, secure and speedy payment methods, which is what Pay by Bank provides. With robust security, consumers can safely make large payments at a time that’s convenient to them – an attractive offer.
When making large purchases, customers demand more than just a premium product, and they expect an exceptional experience too. This experience stretches from an expectation for a product’s sustainability credentials and quality to seamless and secure payments. And with Gen Z and millennials making up the largest consumer base for luxury goods, now is the time to listen to their needs and address their concerns. In competitive markets, high-end merchants need to make sure they’re investing in their businesses from the ground up – especially in their checkout experience.
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