As Gen Z and Millennials become more price-conscious and focused on experiences, value now takes precedence over brand loyalty
As digital retail expands, consumer perceptions of price and shopping habits are changing significantly, particularly across different age groups. In today’s fast-changing retail landscape, Generation Z (Gen Z) and Millennials now display a strong preference for online shopping, guided by value, seamless online experiences, peer reviews and trust rather than by legacy brand names.
With over 377 million individuals, Gen Z (born between 1997 and 2012) is now the largest generation to ever live in India. Far from being a homogeneous group, Gen Z inclines more towards convenience than loyalty. A study by Sciative Solutions, a player in artificial intelligence (AI)-powered pricing intelligence, revealed that 66 per cent of Gen Z and 68 per cent of Millennials (born between 1981 and 1996) are inclined to prefer online websites rather than conventional brick-and-mortar stores
The ease of online comparisons, economic challenges and shifting consumer values are making Gen Z and Millennials increasingly price-sensitive and less brand-loyal, with only 12 per cent of Gen Z and 14 per cent of Millennials willing to stick with a brand no matter what it costs.
Sense Of Value Awareness
In terms of pricing behaviour, both generations share a high sense of value awareness. The Sciative Solutions’ report highlighted that both Gen Zs (46 per cent) and Millennials (43 per cent) are open to paying more if value is delivered through better service or exclusivity. The willingness to pay a premium hinges on tangible benefits that the brand or marketplace offers.
With superior customer service, which includes faster delivery, hassle-free returns, as well as exclusive product drops, these value additions enhance overall satisfaction and justify the price premium, especially when the shopping experience feels more personalised and convenient.
Highlighting a shift in how young customers perceive value, the report added that though 68 per cent of Gen Z are prioritising price at their initial purchase, 80 per cent would be willing to pay a premium if they are certain about the quality, illustrating a contrast between sensitivity towards price and long-term value.
Surging Spending Power
A separate report by Snap Inc. and Boston Consulting Group (BCG) titled ‘The USD 2 Trillion Opportunity: How Gen Z is Shaping the New India’ stated that Gen Z’s Collective spending power reaches an impressive USD 860 billion, surging to USD 2 trillion by 2035. With one in every four Gen Z are already in the workforce, by 2025, every second Gen Zer will be earning, the Indian economy is set to leverage this exciting phase, the report added.
Out of Gen Z’s total spending power of USD 860 billion, approximately USD 200 billion is contributed through direct spending. The rest USD 660 billion is termed as ‘influenced spending’, which includes the purchases influenced by their recommendations or preferences.
Declining Brand Loyalty
While both Gen Z (69 per cent) and Millennials (66 per cent) consider price a critical factor in their purchase decisions, brand loyalty is relatively weak across both groups. Only 12 per cent of Gen Z and 14 per cent of Millennials remain brand loyal regardless of price, reflecting a more price-driven mindset, as per the report by Sciative Solutions.
“Affordability now often outweighs traditional brand allegiance. These consumers prioritise transparency, social responsibility and genuine value over premium branding, leading them to readily switch brands when alternatives better match their financial and ethical preferences,” highlighted Anshu Jalora, the Founder and Managing Director (MD) of Sciative Solutions.
These younger shoppers are highly open to trying new products, especially when they offer competitive pricing and good quality. This shift in consumer behaviour is lowering entry barriers, making it easier for newer brands to break through. The report explained that with 95 per cent of consumers quickly switching platforms if another offers a better experience, this proves that loyalty today is driven more by value than habit.
Rising Trend For Online Shopping
While Gen Z has been naturally inclined toward online platforms due to their digital upbringing, Millennials are now embracing this shift as well. With rapid technological advancements, the surge in ecommerce and quick commerce platforms is evident. A report by Bain & Company and Flipkart, titled ‘How India Shops Online 2025,’ revealed that India’s electronic retail market has scaled to an impressive USD 60 billion in 2024.
In 2024, more than two-thirds of all e-grocery orders and one-tenth of e-retail spend happened on quick commerce platforms. Quick commerce is forecasted to grow by over 40 per cent annually until 2030, fuelled by expansion across categories, geographies and customer segments, as per the stated report.
“The Indian market is distinct in its consumption and growth patterns. The surge in quick commerce is fuelled by a dense and busy urban population, increasing purchasing power, convenience-driven assortments and affordable labour. Urban centers have a higher concentration of affluent consumers willing to pay a premium for convenience,” Soumya Chatterjee, Director Customer Success – India, GfK- a NielsenIQ (NIQ) company, told BW Businessworld earlier.
Sharing A Price-sensitive Mindset
Having grown up in a hyper-connected world, Gen Z automatically looks towards digital sources for buying necessities. Gen Zs place the highest importance on discounts and promotions, followed closely by product availability when making purchase decisions. On the other hand, Millennials are more cautious, with customer reviews being the top influence on their shopping decisions.
Indicating a price-sensitive mindset, across both Gen Z and Millennials, a majority (over 45 per cent) perceive discounts as very important. With increasing visibility and accessibility making pricing highly transparent across brands and platforms, shoppers actively compare prices before making a purchase, giving rise to a discount-driven mindset.
“Today’s young Indian shoppers are incredibly savvy. What looks like price-hopping is actually smart shopping. At Culture Circle, our verified marketplace shows this daily – customers research extensively before investing in authenticated luxury. They have price-checked across platforms, studied our authentication videos and consulted friends about their purchase,” stated Devansh JainNawal, Co-founder and Chief Executive Officer (CEO), Culture Circle
Personalisation Aiding Growth
With India’s non-metro cities beginning to align themselves with the mainstream growth trajectory and there being a clear inclination towards online shopping, personalisation becomes one of the key elements when it comes to catering to the needs of the customers on a platform. The role of generative AI (Gen AI) also becomes crucial in this case.
“Many platforms are focusing on regional festivals, local preferences and culturally relevant marketing campaigns to resonate with consumers in these towns. Ecommerce platforms are responding by increasing their listings of local brands and offering products that resonate with these buyers,” explained Swagat Sarangi, Co-founder, Smytten and Smytten Pulse.
With both Gen Z and Millennials remaining highly price-sensitive, future success will depend not just on offering competitive pricing but also on ensuring platform consistency, product availability and seamless shopping experiences to meet evolving customer expectations.
