Image Credit: Veg Non Veg
52% of India’s population is now made up of Gen-Z (1995-2012) and millennials (1982-1994), with the share expected to hold till 2030.
As millennials fade into the wings, Gen-Z is taking centre-stage. This is a generation raised with 4G, who uses selfies more than mirrors and has never heard the tune of a dial-up modem.
Retailers, especially in fashion, seem to agree that this generation has unique needs and are addressing them through new brands.
Trent has seen significant success with its affordably priced, mass retail brand Zudio, which reported sales of Rs 1,100 crore in FY22, nearly a quarter of Trent’s consolidated revenue. Myntra has launched Myntra Fashion Forward (FWD), a Gen-Z Brand, complete with a virtual fashion influencer called ‘Maya.’ Reliance is bringing back Shein, the fast-fashion giant from China, whose 2022 revenue of US$ 24 billion, was nearly equal to Zara and H&M combined!
There are a host of independent brands in this space, like Urbanic and Newme. Gen Z-specific marketplaces have also sprung up. Capsul, founded by former Puma employees, Meenkashi Singh and Bhavisha Dave, is a marketplace for streetwear brands. While multi-brand sneaker /apparel retailer Veg Non Veg has been around for 5+ years now, sneaker reseller Mainstreet Marketplace, run by 24 year-old Vedant Lamba, just raised $2 million from some heavyweight investors.
I spoke to Gen-Z consumers, as well as founders, to find out how this generation is different and what that means for brands.
Scarcity as Strategy
More reviews mean more sales, right? Not for Gen-Z.
According to Sumit Jasoria, founder of fashion brand Newme, typical e-commerce axioms don’t hold true for this group.
“Gen-Z craves exclusivity. They hunt for ‘statement pieces’ that are unique, mirror their style, are affordable, and crucially, available in limited quantities. Many of our customers intentionally avoid highly-reviewed items, as they are terrified it will be worn by everyone else.”Sumit Jasoria, Co-founder & CEO, Newme
This sentiment was echoed by several Gen-Z shoppers.
Shopping was perceived as a personal quest, where others’ star ratings or reviews, bore little relevance.
“Imagine how awkward it is if someone else is wearing the same T-shirt. I really like Zara’s strategy because they make only limited stock and 2-3 similar designs,” says Dishu Dulani, a 21 year-old from Rajnandgaon, Chhattisgarh, who is currently doing her MBBS in Aurangabad.
Newme tackles this problem by releasing several design drops every week. Jasoria tells me they have a near-zero inventory model. Production is directed by a data science system that uses nine parameters to predict trends, and popular items sell out quickly. The idea is to make sure you don’t find the same piece next time you look.
Thrifting Has (Finally) Arrived
Every single Gen-Z consumer I spoke to, from Chhattisgarh to Bangalore, said they either loved shopping from thrift stores, had tried it out, or were open to it.
Reasons ranged from curation, unique items and global inventory, to sustainability and ethics. Limited edition pieces can also sell for a premium, despite being used. Surprisingly, although affordability was a factor, it was always mentioned last, and was quite clearly a feature and not the benefit.
Neha Reddy is a 23-year-old, who works as an analyst with a VC firm in Bangalore. She is confident of her personal style and shops at thrift stores and smaller marketplaces to find unique, one-of-a kind items.
“Instead of offering thousands of items like Myntra, thrift stores and focused marketplaces like Capsul offer curated selections. Over time each store develops a unique personality, almost like a brand and I’ve identified some that really match my style over the years and stuck with them.”Neha Reddy, 23, Analyst at Antler, Bangalore
Bhavisha Dave, co-founder, Capsul, says that they curate culturally-rich brands that resonate with the ethos of their buyers. While they stock international labels that come with corresponding price points, Dave points out that besides being conversation-starters, these pieces are eminently ‘re-sellable.’ “Our customers know that a T-shirt for Rs. 4000 from Carhartt WIP, (a brand that started as workwear, but is now one of streetwear’s top labels), could easily resell for Rs. 2000+,” she says.
Surprisingly, none of the people I spoke to had reservations about wearing ‘used’ clothes, and the idea of stigma seemed silly to them.
Perhaps the time has finally come for the Indian pre-worn industry, which has hitherto struggled?
Comfortable Living Many Lives
In the absence of Tik Tok in India, Instagram is not just the platform of choice for Gen-Z, it is a place where they can live an alternative life.
Many Gen-Zers aspire to be influencers and they understand how the algorithm works. “On social media, authenticity is valued and your account will only be surfaced if you stand out from the others,” says Shradha Anna, 23, marketer at a Bangalore-based, fashion marketplace.
This was clearly in contrast to the real lives of these young people, especially in small towns, where being different was frowned upon and would lead to parental pressure, or for the women, even harassment on the streets.
According to Jasoria, 70% of Newme’s customers are in Tier 2 and 3 cities and they often buy trendy clothes that can only be worn online, or on college campuses. “They will wear the clothes and post Instagram reels,” he says, “but then switch to more conservative attire when they go home.”
There are multiple WhatsApp groups where clothes can be exchanged after being worn a few times. The more intrepid post content from the trial rooms of malls, obviating the need to buy anything at all!
There is no getting away from the fact that this generation is markedly more expressive than the previous one. As Arman Mehra, a post-graduate student in Delhi, tells me, “My parents always wanted to blend in, I want to stand out.”
The THC Take
Does selling to this audience require a focused set of brands, and will incumbent brands be unable to make the leap?
Certainly, most Indian companies have chosen to launch separate ‘youth-focused’ brands, from Titan’s Fast Track, to Trent’s Zudio. However, global giants like Gucci, Maybelline and most notably, Nike, have successfully ‘aged down,’ to address shifting audiences.
Capsul’s Dave points out that thoughtful attitudes towards brand-building are the reason some global brands have managed to stay relevant. “When a Louis Vuitton does a collab with Supreme,” she says, “They are doing it to gain cred with Gen-Z – it’s not about immediate sales. To appeal to Gen-Z, you need a team that understands them, and that should be your starting point.”
I was heartened by the many conversations I had, and it was clear these young people are quick to see through inauthenticity and would not hesitate to call out bullsh*t. Brands need to engage with them deeply, before taking any decisions.