Purchase Behaviour of Generation Z - Literature review Example

ABSTRACT The purchase behaviours differ from one age group to the other. Though several studies about purchasing behaviours exist, little effort has gone into studying the purchase behaviour of generation Z. An assessment of generation z is therefore, overdue. This study focuses on generation Z which comprises of people born between 1990 and 2010. In this study, a number of researches have been examined on generation Z purchase behaviours, narrowing down to the determinants of their purchase decisions. The study also tries to establish how generation Z responds to challenges facing the environment in today’s world. The purpose of this study is to investigate the following issues; to determine the general purchase behaviour of generation Z, to understand their behaviour towards shopping malls, to determine their behaviour with regards to the environment and to consider the impact of social media on their purchasing decisions. TABLE OF CONTENTS ABSTRACT 1 Introduction 3 Generation Z general purchase behaviour 3 Generation Z buying behaviour towards shopping malls 5 Environmental considerations 9 The impact of social media on generation Z purchase behaviours 11 References 14 Introduction With the emergence of the digital era, the young consumers have played a significant role in online shopping. The increased use of internet by generation Z increases marketer prospects. Generation Z, also called digital natives refer to those people born between 1990’s and 2010. Notably, Generation Z comprises people who are dependent and more comfortable with technology after having been brought up in a globe with ever present technology. In addition, they are ever connected through constant communication by means of social networking channels such as face book and twitters. Moreover, they are able to multi task on quite a number of online products through the use of sophisticated devices. In an effort to enhance close contacts with customers, companies are adopting technology- based sales and marketing for instance mobile internet, text messages, social networking among many others. Further, they have enhanced their virtual presence by developing high value products bearing basic interactive designs and that can multifunction. Interestingly, the Z generation is more conscious about the environment forcing companies to produce green products and services that have reduced environmental effects if not harmless to the environment. This literature review sheds more light on generation Z general products and services purchase behaviour giving more emphasis on their behaviour towards shopping malls, environmental issues and impact of social media on facilitation of their behaviours. Generation Z general purchase behaviour Online trade has an immense potential for marketers. This indicates that, the digital natives are the greatest buyers through online services. Rule & Ferguson (1986) observed that age and internet buying had a positive relationship. According to their study, digital natives were reported to have purchased more linen through online. Further, the study carried out by Ferle et al. (2000) indicated that young purchasers shopped for more products online and were highly likely to buy online due the element of convenience. According to Rule & Ferguson (1986), there are four main factors including reliability, web design privacy and customer service that highly attract Generation Z to online purchases. Omelia (1998) observed website design as one of the significant factors that attract digital natives to online purchases. Zollo (1995) agreed that elegant designed websites attracted the target audience. Shim (1996) affirms that a more appealing website makes the youngsters to visit the site often and even stays longer after logging in. Another factor that highly influences the digital natives to be more inclined to digital purchases is reliability. Moschis (1976), say that reliability measures the clients’ perception if the sellers honor their promises. Nonetheless, generation Z online purchasers expect to get the right quantity and quality of ordered goods while at the same time expecting the supplier to observe the lead time. However, for online transaction to pass the reliability test, online service providers must observe the time frame agreed with the buyer. Further studies by Moore & Moschis (1981), reveals that, a significant relationship exists between consumer motivation and trust. Nevertheless, the apparent level of trust by the purchasers stimulated positive behaviour and attitudes on the side of sellers (Goff, 1999). Seemingly, the trust that the generation Z online purchasers holds on online store is seen as direct trust in the store. However, Strong (1996) supports the effectiveness of the third party trust through the use of public key encryption infrastructure and certification bodies that guarantee financial security. Nonetheless, Kaiser et al., (1998) supported the necessity of having trust on online business. They claimed that, the buyer must hold trust on the online transaction medium. Generation Z buying behaviour towards shopping malls Shopping malls creates an avenue through which the teens socialize with friends while being entertained and perhaps visiting the website. A research, which was done by Bandura, (1977) suggested that the marketers require according the teenagers particular attention on products and services consumption given their psychological and demographic characteristics. Despite most youths being jobless, they hold more disposable income earned from part-time jobs and parental allowances when compared to adults who holds their excess income for savings. Overtime, shopping malls have substantially developed and now offer diverse social and entertainment facilities. As observed by Bloch, Ridgeways & Dawson (1994), expanding the mix of various facilities offered, the malls have nowadays positioned themselves as centres of cultural events and entertainment centres. Digital natives consider malls as avenues where they can spend more time. Taking note that adolescence is the highest time for new discoveries and self identification, many teens are spending significant time in shopping malls (Peattie & Crane, 2005). As pointed out by Wilson and MacGillivray (1998), teenagers show strong psychological need to be accepted and recognized by their age mates. The teens emphasize on life style preferences, fashion, leisure activities and music because of peer pressure. Moreover, teens consider shopping malls to have a greater impact as it gives them an opportunity to socialize with others, give their expressions and a sense of independence (Zollo, 1995). Nonetheless, shopping malls tend to be favourable avenues through which teens can afford an environment of entertainment, socialize with others and more importantly solve their psychological stress and loneliness (Bloch et al., 1994; Omelia, 1998). Therefore, giving close consideration of the role played by shopping malls in meeting the teens diverse needs, the marketers should critically analyse their consumption behaviour. According to Kang et al. (1996), the shopping mall motivation differs based on age group. The teenagers portrayed social experience and browsing motivations as the drivers to visiting the shopping malls. Motivation of shopping at the malls can be classified as either hedonic/ experimental motivation or utilitarian motivation. According to Zollo (1995), utilitarian motivation refers to the satisfaction of functional needs for instance purchase of goods and services, convenient shopping, reduction of costs that may have otherwise spent on shopping from different roofs among others. On the other hand, hedonic or experimental motivation concerns satisfaction of expressive or emotional needs including relaxation, gratification and fun (Bloch, Ridgway & Nelson, 1991). Hedonic needs according to various literatures could be achieved from browsing, entertainment, social experiences and ambience. In understanding consumer behaviour, early researchers concentrated on consumer socialization factors for instance peer, family and media (Omelia, 1998; Moore & Moschi, 1981; Moschis & Moore, 1979). Further research, incorporated additional variable including brand choice, shopping orientation, shopping experience, entertainment among others. Notably, related studies revealed that teen consumers are more likely motivated to shop in pursuance of hedonic needs such as enjoying the crowds, food stuffs offered at shopping malls, browsing among others. Loneliness as observed affects significant section of the society. Commonly, loneliness is considered to be unpleasant experiences, subjective experience caused by social isolation or deficiencies of individual’s social relationships. However, to solve the loneliness puzzle, teens search for more satisfying social contacts and friends. As suggested by Bloch et al. (1991), shopping mall can form avenues for teens to fight the loneliness through socializing, entertainment, browsing or simply purchasing. More literature has supported retail setting as one of the avenues to facilitate social stimulation for the teens. According to Tauber (1972) shopping malls assist in achieving both personal and social motives. An individual may choose to visit a retailer when depressed, lonely or bored in search of either social contact or diversion. Negative feeling toward personalised retailing was found to be exhibited by most lonely consumers. However, previous research work has indicated that all retailers provide avenues for social participation for lonely teens thus avoiding isolation feelings. Nevertheless, Hirschmann (1984) established that experimental motivations to mall shopping bears negative relations to social isolation as lonely teens would hardly engage in shopping for novelty or sensory purpose. Also, important to note is that, during adolescence stage, power and presence of a family member reduces, and teens are yet to assume more demanding family roles. However, this translational period develops teens with more interest in media usage as a means of socialization (Goff, 1999). Moreover, after school, many teens go to their parents home and due to the aspect of being alone, they may spend considerable time on media. As observed by Lee (2007), Media teaches teen on values, behaviours, norms while at the same time fulfilling their other diverse needs including killing time, coping, relaxation, entertainment and more importantly identification with the youth culture. Notably, listening to music, watching television and reading printed materials was the strategy used by teens to cope after a stressful day in the school. Nonetheless, it is highly speculated that loneliness in teens causes more use of media. Therefore, presence of media exposes teens to varieties of products and services that could otherwise not be learned through friends or family members. Moreover, as teens seek to distance themselves from family members and influences of friends, media could act as the favourable agent through which their consumption choices can be influenced (Wilson & MacGillivray, 1998). As reported by Kang et al., (1996), roughly 76% of teens watch television while 24% listens to radio. According to Moschis (1976), media have been proved to significantly influence consumer socialization decisions, product evaluations, shopping behaviour, and brand loyalty among other consumer behaviours. The type of media was also found to significantly contribute in either positive or negative consumer behaviour. For instance, television watching led to undesirable consumer behaviour of increased willingness to consume, unlike newspaper reading, which allowed consumers to make ration consumption decisions through financial management (Lee, Lennon & Rudd, 2000). Shim (1996) investigation into teen’s consumption decision making established that, the influence of television commercials led teens to purchase expensive brands while at the same time seeking fashions besides shopping for entertainment and recreation. However, use of print media influence teens towards utilitarian behaviours such as purchase of high quality items while putting price into consideration (Shim, 1996). Further studies tried to establish how media usage swayed teen’s consumption choices. Moschis and Moore (1979) viewed that reading newspapers highly influenced brand preferences amongst the teens. Further, the authors observed that teens evaluated different products costing different prices, performance and other characteristics with a given brand name. Ferle et al. (2000) discovered that magazines and television had considerable influence on adolescent consumption behaviour. Seemingly, radio and television fulfilled leisure and entertainment needs, which magazines were largely used to provide health related and shopping information. Environmental considerations Overtime, green marketing has gained prominence in today’s modern world. Following the environmental backlash in 1990s, green marketing gained popularity, not only in western countries, but all over the world (Ottoman et al, 2006). Nonetheless, governments and people are increasingly getting worried by devastating effects on human as a result of environmental destruction. This has led the society to come up with mechanisms such as “going green” in a bid to stop further environmental destruction. By definition “going green” means production of items and services through processes that are environmentally friendly. This section examines the green consumer behaviours amongst adolescent consumers and the key factors that influence their purchase decisions. According to Peattie (2001), green marketing refers to product promotion or marketing while taking into consideration environmental effect thereof. During the emergence of the green tide, many marketers looked forward to generate favourable consumer response which could guarantee increased revenues, market share and goodwill. However, considering that environmental issues were one of the issues at public interest, emergence of green products disappointingly failed to meet the marketer’s expectations (Wong et al., 1996). Later on, the marketers learnt that the strong will to have green products and the great concerns for the environments did not translate to significant influence on purchasing behaviour (Wong et al., 1996). During 1990’s, consumers gained more knowledge and were now aware of the concept of green marketing. Strong (1996) noted that, overly critical consumers formed a new force that started to demand corporations to be socially responsible. As observed by Uusitalo and Oksanen (2004), the gradual development of green consumerism expanded to a concept called ethical consumerism, which involves buyer’s behaviours reliance on unjust and unethical global trade actions such as an infringement of human rights, suppression of labour unions, inequalities in trading, low paid labour among others. Despite the evolution of green products, little is understood about customers’ green buying characteristics. Further little if not none is known about generation Z green buying behaviour. Notably, adolescents forms a significant number of the society and thus crucial in environmental conservation. According to Ottman (2007); Tai and Tam (1997), teens are more willing to learn new innovative ideas compared to the older generation. The main idea about this section is to explore factors that motivate generation Z to participate in green purchasing behaviours. As observed by Hirschman (1984), social influence is one of the factors determining the teen green purchasing behaviour? Further, the study suggests that peer network encourages and reinforces a norm of a given environmental behaviour. As such the teen green purchasing behaviours were seen to possess social meanings. Further research suggests that interpersonal communication acts as one of the key aspects that affect the teens purchasing behaviour. It singles out effect of buzz marketing in which people recommend green products to their friends within their consumer group. There is behaviour where one follows a certain social circle making individuals be seen as abandoning their personal interests to comply with the larger social norms (Hofstede, 1980). Also, significant was the issue of environmental issues, which was also found to influence consumer purchasing behaviour. The study also establishes that teens green purchasing behaviour is more dependent on emotional engagement rather that rational assessment. Another factor that determines the teens green purchasing behaviour is the element of perceived environmental relationship together with the perceived effectiveness of environmental behaviour. In addition, the factor that individual’s action could impact positively in decision making to purchase green products. Last and not the least are the perceived natural environmental problems. Therefore, the more serious environmental problems are taken, the less are the chances of buying green products. Nonetheless, it is highly probable that elimination of emotional, cognitive and untimely behavioural responses affects the teen green purchasing tendencies. Rule and Ferguson (1986) argues that repeated view of pictures about environmental damage exposes teens the effects of environmental degradation thus suggesting. The impact of social media on generation Z purchase behaviours Advancement in technology has led to the invention of social media. Social media can be defined as a group of internet applications constructed on the technological and ideological foundation of web 2.0 which allows exchange of user generated content (Bakewell & Mitchell, 2003). The consumers are using social media such as face book and twitter to communicate with fellow consumers and sellers (Gupta, Armstrong & Clayton, 2011). In social media platforms, users create profiles and networks through which they communicate with other. Interestingly, through social media networks, not only consumers can chat with the sellers, but also companies have the ability to chat with their clients and also other companies (Mangold & Faulds, 2009). Social media facilities are famous for providing one to one interaction mostly between the seller and the customer hence enabling companies to enjoy the advantages of their client input in product development. Further, this medium is offering companies an opportunity of understanding their customers within a short period of time. Moreover, companies are nowadays increasingly using social media to interact with their clients (Gupta, Armstrong & Clayton, 2011). According to research carried out on generation Z usage of social media, most of the participant believe that the facilities provides a suitable medium to interact with their friends all over the world. However, most of this age group were found to spend most of their time in face book. Generation Z age group use of social media is highly influenced by pleasure. Based on company- consumer identification framework, an individual social identity can only be established when a consumer identifies with a given context around them. According to Strong (1996) such social category can either be sports team or any other grouping. Being active in face book or twitter would thus entail being part of a social category by virtue of doing so to copy friends. Most teens tend to like and follow companies through the social media particularly face book and twitter. Strong (1996) argues that when a teen finds a company attractive and believes the company possesses similar desirable identities, it will be highly probable that the company may identify with such individual and chances are high that one may end up buying commodities from that company. Seemingly, it thus imply that generation Z use social media to establish a sense of identity besides the image that one maintains while active in face book. Williams and Page (2011) argues that generation Z use social media for expressing their attitudes. Teens highly regard accept ace from peers and feels a sense of belonging. As such, social media identity tries to make sense of self by maintaining social identity that authenticity mirrors an individual’s true group belonging. Jansen et al. (2009), in their studies, indicated that generation Z use social media to communicate with various friends thereby influencing each other consumption decisions. According to Williams (2010), reviews and comments from known and unknown online friends influenced purchase decisions. Dhalen (2002) established that generation Z appear to be linked between a numbers of websites. By this, the face book page is linked to corporate websites thereby facilitating transportation from one web page to the other. As such, it proves that generation Z are highly applicable to transportation model, which needs users to follow some links that lead to other companies’ websites. This confirms that generation Z may be highly susceptible to product campaign if it proves to be more appealing to them. Conclusion The literature review has established that a number of factors influence the teens buying behavior. First, it is worth to note that this generation is technology savvy having been born when globe turned digital. However, it is not surprising to find that generation Z applies technology considerably in their buying patterns. Their buying decisions are substantially influenced by information obtained online unlike other generations whose buying behaviors were influenced either by parents or friends. Notably, social media has been single out as one of the main channels through which teens purchasing behavior is influenced. This is through suggestions from both known and unknown online friends. Nevertheless, generation Z is also highly sensitive to environment conservation and would prefer identifying themselves with organizations that are environmental friendly. References Dahlén, M. ( 2002). Marknadsföring i nya media – marknadföring i kubik. 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