A battle of holiday spending habits - Gen Z vs. Millennials

Did you know that there are more than 72 million Millennials in the United States? That’s almost 22% of the nation’s population. And considering these 26-41 year-olds make up the largest adult demographic with the highest employment rates (plus an estimated $2.5 trillion in annual spending power), it’s no surprise why retail sellers and brands go to such great lengths to attract Millennial consumers.¹

But what about Gen Z, the youngest generation of adults, ages 18-25? Most of these individuals are starting to enter the workforce and with their spending potential on the rise, marketers have grown eager to reach this elusive and tech savvy bunch. However, Gen Z consumers are no easy win – they have become notorious for their differing tastes and difficulty to please when compared to their older counterparts. 

With the holidays on the horizon, we explored some of the nuances between Millennial and Gen  Z shoppers via our eBay Ads’ Annual Holiday Survey. We wanted to understand if and how each demographic might approach the season differently as it relates to planning and spending, so that our sellers can prepare effective ad strategies for the most wonderful time of the year. 

Here’s what we uncovered. 

Millennials are more budget conscious when it comes to their holiday spending 

Without a doubt, Millennials are more budget conscious when it comes to spending. They are known to prioritize savings, and according to Bank of America’s 2020 Better Money Habits Millennial Report, nearly one in four Millennials that are saving have at least $100,000 or more, a number that’s up 16% since 2018.²

This trend aligns with our survey insights, which found that 75% of Millennial shoppers consider good value for money to be their biggest priority when shopping for gifts this year (compared to 65% of Gen Z shoppers).³

Further, we found that Millennial shoppers are more likely to be on the hunt for deals this holiday season in comparison to their Gen Z counterparts, with more than half of Gen Z shoppers (55%) planning to spend more on holiday shopping and celebrations than last year, and only 39% of Millennial shoppers intending to do the same.⁴

For Gen Z, the holidays are worth the splurge considering that only 2% of Gen Z respondents believe celebrating in the most cost-efficient way is a top priority. 

Gen Z shoppers start their holiday spending sooner, but both groups prefer to do their purchasing online

When Gen Z consumers are ready to buy something, they don’t think twice, they just do it. In fact, feedback from our survey of online and eBay shoppers revealed that in July, 72% of Gen Z respondents had already bought festive items and gifts in preparation for the holidays, while only 46% of Millennial shoppers had done so.⁵ These pre-purchased goodies include festive clothing and accessories, holiday wrapping paper and more. 

The one commonality between both demographics? Their affinity for buying their holiday items online. As it turns out, holiday shopping online is a no-brainer for both groups, with a majority of Millennial and Gen Z shoppers (83% and 87% respectively) planning to do most of their gift purchasing digitally this year.⁶

This aligns with overall US shopping behaviors (consumers spent a record of $204 billion online during the holidays last year, up 8.6% YoY) and points to the importance of planning a seamless ad strategy across the entire holiday season that increases visibility of your goods to digital shoppers whenever they’re ready to buy.⁷

Millennials and Gen Z consumers shop eBay for different items and brands 

On average, every hour during the holiday season Millennial shoppers bought the following items on eBay⁸:

• 353 Cell Phone Cases, Covers & Skins 
• 286 pairs of Men’s Athletic Shoes 
• 138 Men’s Hats 
• 119 Women’s Fragrances
• 103 Vitamin & Minerals 
• 97 Video Game Controllers & Attachments 
• 82 Dolls & Doll Playsets 
• 9 Holiday Stockings & Hangers 

On average, Gen Z shoppers used these keywords most during the holiday season⁹:

• christmas decorations
• christmas tree
• film camera
• gucci shoes
• heater
• iphone 13 pro max
• jbl
• new balance 550
• nike tech fleece
• pokemon celebrations
• shift knob
• vivienne westwood

Data-led insights like these enable retail sellers and brands to take meaningful action when it comes to their ad campaigns. From helping them determine what to sell and promote, to informing more effective listing titles (keywords), to improving upon advertising bid strategies.

Millennial and Gen Z shoppers pay attention to ads during the busy holiday season

It turns out that investing in guaranteed visibility brings an undeniable advantage to sellers during the busy holiday shopping season. 

More than half of Millennial and Gen Z shoppers (63% and 58% respectively) report they are likely or highly likely to purchase a promoted item during the holidays.¹⁰

Search also plays a significant role during the holidays, as 74% of Millennial shoppers and 83% of Gen Z shoppers reported that they are likely or highly likely to go on and purchase items that they view at the top of their search.

Another method to help attract these value-driven shoppers? Offer them some perks. A majority (65% across both age groups) agreed that deals, coupons and free shipping will influence their holiday purchases on eBay throughout the holiday season¹¹.

These findings show the tremendous value of investing in a tailored ad experience that can serve up the right item, promotion or deal at the optimal time – when shoppers are ready to make a purchase. 

To read this year’s full survey report and find tips around how to act on these shopper insights, download our 2022 eBay Ads Holiday Guide here.