What Is 'Phygital’ Shopping? Gen Z's New Favourite Trend

Gen Z in India is bringing a new change to the retail industry through a unique shopping pattern. According to a study by Snapchat, Gen Z buyers have created a blend of traditional shopping with digital experiences, creating what’s known as ‘phygital’. The Snapchat study titled “The $2 Trillion Opportunity: How Gen Z is Shaping the New India” offers insights into the spending patterns of people born between 1997 to 2012.

What is Phygital shopping?

The term ‘phygital’ is a portmanteau of physical and digital. It was coined by Chris Weil, former CEO of Momentum Worldwide, in 2007. It articulates how consumers engage with brands across multiple channels. Phygital experiences build upon the use of technology to create ways of engaging with consumers through convenient, personalised and immersive experiences.

The ‘phygital’ shoppers can easily switch from online to in-store shopping. For example, customers often browse products on their phones while in-store or use apps to check stock availability before heading to the store

Phygital commerce makes consumers have several procurement models, including click-and-collect In this, they purchase online and collect from physical stores.

The key technologies, like augmented reality (AR) and virtual reality (VR), may also be used to enhance the shopping process. Consumers may be offered virtual try-ons or receive product information in real-time.

According to the Snapchat report, Gen Z’s overall purchasing capability is expected to be an incredible $2 trillion by 2035 in India. This demographic, composed of 377 million people, currently spends $860 billion on consumer outlay which is more than 43% of the overall share of the total population.

Of this, $200 billion is spent by Gen Z through direct earnings, while an additional $660 billion is spent based on their preferences in families and friends.

Direct spending is also expected to increase to 250 billion by 2025, and according to estimations, may reach 1.8 trillion by 2035.

Yet, only 15% of the brands target Gen Z in their strategies. This poses a great value-add proposition for businesses to reinvent themselves and deliver customised experiences to Gen Z.