Samjong KPMG "Over Half of Generation Z Purchase Products via TikTok, Instagram, and Other SNS"

by Kim Daehyun

Published 24 Jun.2024 08:57(KST)

KPMG Survey of 7,000 Asia-Pacific Consumers

The mobile-friendly Generation Z (born from the mid-1990s to the late 2010s) is emerging as a major consumer group in the commerce market. More than half of Generation Z were found to purchase products through social networking services (SNS) such as TikTok and Instagram.

On the 24th, KPMG Asia Pacific (ASPAC) and GS1 announced this in their report titled ‘Disruptive Commerce, the New Paradigm Leading Distribution Flows in Asia Pacific.’ This report is based on a survey of about 7,000 consumers from 14 Asia Pacific countries, including Korea, China, and Japan, with about half of the respondents being Generation Z.

Six notable key trends in the distribution and consumer goods market were identified as ▲the rise of Generation Z ▲artificial intelligence (AI) ▲loyalty strategies ▲omnichannel (shopping methods spanning online and offline) ▲digital payments ▲and sustainability.

In particular, Generation Z is leading the future growth and direction of the distribution industry. Social commerce platforms like TikTok and Instagram are influencing Generation Z’s consumption. The majority of Generation Z in the Asia Pacific region mentioned that social commerce (63%) and live commerce (57%) are important factors enhancing their shopping experience.

How Generation Z Uses Technology in the Asia-Pacific Region [Provided by Samjong KPMG]

While AI technology is contributing to improved customer experience and increased sales, it is mainly being utilized in the ‘product recommendation’ area. In Taiwan, Indonesia, India, Hong Kong, and Vietnam, more than 50% of respondents expressed ‘satisfaction’ with AI-based recommendations. Other respondents pointed to demand forecasting, supply chain management, and marketing content development as areas where AI could be applied.

Amid diverse purchasing methods, on average, 45% of respondents preferred ‘omnichannel.’ Thirty-one percent stated that they mainly purchase goods online. Those who preferred offline shopping accounted for 24%.

Regarding platform selection, ‘price competitiveness’ was the most important factor at 57%, followed by ‘product variety (54%)’ and ‘fast and reliable delivery (46%).’

Getting to Know 'Generation Z' [Data Provided by Samjong KPMG]

Digital payments are also growing. The main online payment methods in the Asia Pacific region included e-wallets (52%), mobile banking apps (49%), COD (Cash On Delivery) (39%), debit/credit cards (36%), and contactless debit/credit cards (34%). In countries including Korea, Australia, New Zealand, Japan, and Singapore, debit/credit cards are still primarily used, while in China, Alipay’s market share reached 92%.

Sustainability has also emerged as an important factor. Since 2020, there has been a clear demand for supply chain transparency, with 86% of Generation Z consumers stating that they “prefer brands that clearly implement sustainability.”

Shin Jang-hoon, Vice President and Leader of Distribution and Consumer Goods Industry at Samjong KPMG, said, “The distribution market in the Asia Pacific region is showing growth and is gradually reaching pre-COVID-19 pandemic levels. It is necessary to provide reliable information across the entire supply chain to all stakeholders, including consumers.”