According to investment bank Cowen, by 2028, the share of millennials and buzzers in the global population will increase from 50 to 68%. These generations have their own consumer characteristics, which are in the hands of some companies.
Generations, raised in the digital age, grow up and increase income. Their consumer habits could lead to shifts in retail, ecommerce, catering, food and payment industries. These generations are a critical demographic for investors in consumer and technology companies.”, says Cowen..
In July, the investment bank surveyed 1,200 Americans aged from 18 to 34 years, to determine their consumer preferences. According to the results of the survey, Cowen singled out companies, who can benefit from the rise of millennials and zoomers among shoppers.
Amazon. The e-commerce giant is a popular store among young people. More 60% of respondents named the site as the most preferred place for shopping. According to Cowen, before buying, consumers search and study the product on Amazon, even if they are going to go to a physical store.
PayPal. Young shoppers are increasingly using digital payment systems, study showed. PayPal remains the most popular digital wallet among millennials and zoomers: 51% of respondents used the platform to pay for goods in the last three months.
Chipotle Mexican Grill. Poll, young people try to choose places with dishes made from natural ingredients. Ability to order online and delivery are other important factors. In the food service industry, Cowen highlights CMG: the restaurant emphasizes the naturalness of the ingredients in advertising, and also develops a digital sales channel.
Lululemon. As found out in the investment bank, Lululemon clothing has become more popular among young people. So, in 2019 4% of respondents named the store as their favorite brand of casual wear. IN 2021 — 9%.
Poshmark. The used clothing market is growing fast. The younger generation pays more attention to sustainability, that's why he buys used clothes more often. According to the survey, in the last year, the number of young clothing buyers, shoes and accessories in the secondary market grew by a third. Here, Cowen analysts single out Poshmark, an online platform for buying and selling new and used clothes.. Most users of the service are women and representatives of generation Z.
Poshmark went public 14 January, and already on the first day of trading, the company's shares went up by 140%. But after the promotion of the service began to fall. Poshmark is currently trading at 76% below the January high.
In the second quarter, the company's sales increased by 22%, up to 82 million dollars, and an operating loss of 3 million due to high advertising costs. Unlike other companies on the Cowen list, Poshmark's capitalization is very small - about $ 2 billion.
Promotions of companies popular among young consumers
| Since the beginning of the year | From the maximum | |
|---|---|---|
| Amazon (AMZN) | 4,7% | −9,7% |
| PayPal (PYPL) | 14,6% | −13,5% |
| Chipotle (CMG) | 32,0% | −6,5% |
| Lululemon (LULU) | 15,9% | −7,7% |
| Poshmark (POSH) | −76,3% | −77,1% |
