Anushruti Singh
GenZ Economy in India: At 377 million strong, India’s Gen Z population isn’t just a force to watch—they are the force shaping the future of the economy. Born between 1997 and 2012, these individuals are already responsible for $860 billion in consumer spending, according to the latest joint report by Snapchat and BCG. But the real kicker? Their influence is set to skyrocket, driving $2 trillion in consumption by 2035, meaning every second rupee spent will come from a Gen Zer or be influenced by them.
This demographic not only loves spending but also influences buying decisions at home, making them a critical target for brands across industries. But winning them over isn’t as easy as following a millennial playbook. Gen Zers want something fresh, immersive, and personal—and brands that don’t get it will miss out.
Breaking down the $2 trillion spending power
Let’s talk numbers. Gen Z is already driving 43 per cent of India’s consumption, with industries like travel, dining out, and tech devices particularly benefiting from their enthusiasm. They are just getting started—one in four of them is already working, and this ratio is expected to double by 2035. This means more direct spending power and even more influence over household decisions.
Currently, out of Gen Z’s total spending power of $860 billion, approximately $200 billion comes from direct spending—money they earn and spend themselves—while $660 billion comes from influenced spending, which includes purchases influenced by their recommendations or preferences. By 2035, these figures are expected to change dramatically, with direct spending projected to reach $1.8 trillion, implying that every second rupee of consumer spend in 2035, will be driven by Gen Z.
It’s not just about what they buy but how they buy. Gen Z doesn’t differentiate between online and offline—they are “phygital” by nature, seamlessly blending their shopping journeys across both channels. A Gen Zer might start browsing online, try out a product in-store, and make the final purchase through an app, all while snapping selfies for approval from their friends.
Values that shape their shopping habits
What sets Gen Z apart from other generations isn’t just their tech savviness—it’s their core values, which deeply influence their behavior. Here’s a quick rundown of what they stand for:
– Optimistic about the future: 2 of 3 Gen Zers are confident of their finances, health and social environment showcasing their resilience and positive attitude.
– Authenticity is Key: 76 per cent of Gen Zers believe brands need to be genuine. If a brand is caught lying, they will not only drop it but make sure their friends avoid it too.
– Cause-Driven Consumption: Gen Zers are 2x more likely than millennials to join protests and engage in social causes.
– Inner Circle Matters: About 70 per cent of Gen Zers deeply care for connection with this inner circle, sharing every small detail of their lives with them. Shopping for them is a social activity. They rely heavily on feedback from close friends and creators.
– Trend Hunters: Brands don’t impress Gen Zers—trends do. They are 1.7x more likely than millennials to prioritise trends over brands.
Socialising, not just shopping
Shopping for Gen Z is a group activity. Over 65 per cent of them shop through real-time interactions—be it snaps from trial rooms, video calls with friends, or recommendations from creators they trust. For this cohort, creators are the new search engines. Nearly 70 per cent of Gen Zers use creator pages to discover products and trends, far outpacing the role of traditional search.
Commenting on the survey, Nimisha Jain, Senior Partner and Managing Director at BCG India says, “Gen Z is already driving 43 per cent of India’s consumer spending. It is important for marketers to take note that this generation is driven by unique values and beliefs and therefore have distinctive purchase behaviours, however we noticed that only 15 per cent of brands we spoke to are actively taking steps to tap into this opportunity. For businesses, understanding and authentically engaging with GenZ isn’t just good to have; it’s necessary for winning today and will be imperative for survival tomorrow,”
Brands, take note—if your marketing strategy doesn’t include collaborations with influencers or creators, you’re probably off their radar. The same report reveals that only 15 per cent of brands are actively harnessing this opportunity despite recognising Gen Z’s growing economic power.
Immersion is everything: Visuals drive the experience
Forget plain ads—Gen Z demands immersive visuals. This generation thrives on AR filters, GIFs, and interactive content. They are 1.4x more likely than millennials to engage with brands through AR experiences and expect their interactions to be fun and visually rich. For brands, offering AR tools like virtual try-ons or gamified challenges is no longer optional—it’s essential.
Case in point: A beauty brand recently saw 22x returns on ad spend by integrating an AR lens for users to experiment with new looks. These kinds of experiences appeal to Gen Z’s “see it, snap it, share it” mentality.
What brands need to do to win over Gen Z
The road to capturing Gen Z’s attention involves more than catchy slogans. Brands need to rethink every step of their strategy—from product design to communication. Here are the five key levers outlined in the report to align with Gen Z’s preferences:
1. Innovate Rapidly: Trends are fleeting, and brands must quickly adapt to them by co-creating with Gen Z and reducing concept-to-shelf timelines.
2. Enable Social Shopping: Incorporate features that allow Gen Zers to shop with their inner circle, both online and offline.
3. Offer Immersive Experiences: Use AR lenses and gamified shopping to engage them.
4. Build Omni-Channel Journeys: Ensure seamless integration across online and offline platforms.
5. Engage the Right Influencers: Leverage the power of micro and nano influencers who resonate with Gen Z values.
Time to act is now
India’s Gen Zers aren’t waiting to grow up—they are already shaping the economy, influencing brands, and driving trends. With consumption on track to hit $2 trillion by 2035, brands that fail to understand their values and behaviors risk becoming obsolete.
The report from Snapchat and BCG sends a clear message: The Gen Z wave is here, and only those brands willing to innovate will ride the tide. As Gen Zers embrace new experiences and demand authenticity, businesses must evolve quickly or risk being left behind.
Brands that recognise this opportunity early have a shot at not just surviving but thriving. After all, every second rupee spent in the future will have a Gen Z footprint—and if you don’t get on their good side now, someone else surely will.
