India’s Gen Z’s Collective Spending Power To Reach $2 Tn By 2035: Report
With a population of 377 million, Gen Z is already driving 43 per cent of the country’s consumer spending
Highlighting the growing economic influence of India’s Gen Z (people born between 1996 and 2010), the collective spending power of the country’s Gen Z has reached USD 860 billion and is expected to surge to USD 2 trillion by 2035, according to a report by Snap (parent company of Snapchat) and Boston Consulting Group (BCG).
With a population of 377 million, Gen Z is already driving 43 per cent of the country’s consumer spending, as per the report titled ‘The USD 2 trillion opportunity: how Gen Z is shaping the new India’. The report added that Gen Z’s direct spending will amount to USD 250 billion in 2025.
As per the report, this dynamic cohort is impacting significant spending across categories such as 50 per cent of total spending on footwear, 48 per cent on dining, 48 per cent on out-of-home entertainment and 47 per cent on fashion and lifestyle.
The way the spending is distributed shows that currently, out of Gen Z’s total spending power of USD 860 billion, approximately USD 200 billion comes from direct spending—money they earn and spend themselves—while USD 660 billion comes from influenced spending, which includes purchases influenced by their recommendations or preferences.
“India is a young nation with a 377 million Gen Z population which will shape the future of India's growth in the next two decades. Gen Z will be the biggest contributor to India's consumption growth driving USD 1.8 Trillion worth of direct spend by the year 2035,” stated Pulkit Trivedi, Managing Director, India, Snap Inc.
The report highlighted that one in four Gen Z are already in the workforce and by 2025, every second Gen Z will be earning. As per the data, 45 per cent of businesses recognise Gen Z’s potential, but only 15 per cent take action to actively address them indicating a huge opportunity.
“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,” stated Nimisha Jain, Senior Partner and Managing Director at BCG India.
The findings of this report are based on primary research done with about 1000 parents to assess the right degree of influence and around 1200 Gen Zers and millennials to discern their defining values and purchase behaviour.
