FMCG Brand Acceptance and Loyalty Among Gen Z in Indonesia

Gen Z are “conquering” the world. According to KPMG Malaysia Head of Consumer & Retail Ngu Heng Sing, Gen Zs make up 25% of the global population; and come 2030, they are expected to have a total consumer spending of $12t [1]. And as one of the most fiercely competitive industries, FMCG brands are on average rated higher among Gen Z compared to older age segments [2].

Nevertheless, some reports from numerous studies and news said that Gen Z’s buying habits are intriguing and quite distinct from those of previous generations. For instance, whilst Boomers and Gen X value quality and experience when choosing products, Gen Z prefer brands that advocate for social equality over anything else [3], which match their characteristics; the most important things for them are human rights, mental health, sustainability (e.g. preventing climate change, and so on), education, and their unique identity [4].

Hence, to discover this phenomenon further, Snapcart conducted a study about Gen Z in Indonesia’s habit and behaviour in shopping and choosing daily necessities brands like FMCG products that they use and/or consume every day. Can you guess how loyal they are to these brands? Check out the results of this study below.

Some research reported that some Gen Z are either still living with their parents and financially dependent on them, or already married. Thus, we asked our 2.424 respondents (50% Gen Z aged 12 – 20 y.o. , and 50% Gen Z age 21 – 27 y.o.) whether they shop FMCG by themselves or not, and we discovered that in Indonesia, only 13% of Gen Z do not purchase these goods on their own because daily necessities are usually purchased by a family member. Nonetheless, 69% of them stated that they participate in the process of selecting the FMCG brands to purchase.

Gen Z’s Ideal Brand Criteria

Even though in the previous paragraph many studies said that emotional reasons have driven Gen Z to buy or not buy certain brands, but this study discovered that rational considerations like price, product quality, and discounts/promotions still affect many Indonesian Gen Z in choosing brands. On the other way, being a religious generation and breaking the society’s stereotype [4] [5], a lot of Gen Z in Indonesia (39%) prefer to buy an FMCG halal certified products.

Whilst price, halal, and product quality become the main factors for Gen Z in purchasing FMCG, we figured out that people’s recommendations also play a significant role for their shopping decisions.

Despite the fact that Gen Z are digital native who are very active on the internet, accessing social media, and do Google research [4], most of them (39%) think their family and friends’ recommendations are more trustworthy than anyone else’s. You can check the details of this data on the infographic above.

How Loyal Are Gen Z?

Since Gen Z are well known as a “can’t be tied down” generation, many peop options, even if they have a favourite brand in order to find cheaper and/or hig le ask this question as well, and some studies abroad indeed have proven that majority of this generation in some countries like US and UK would check out other brand her quality brand(s) [6]. However, what about Gen Z in Indonesia?

Our research found that Indonesian Gen Z’s level of brand loyalty is quite similar with Gen Z from other countries. As the infographic above illustrates, most of this generation in Indonesia (43%) said they tried using and/or consuming a new FMCG brand every once in 1 – 3 months. Their reasons also quite similar with Gen Z who live on the other side of the world; finding higher quality (27%) and/or more affordable products (15%). Only 22% who remain loyal to their favourite FMCG brand(s).

Additionally, this study also figured out that Gen Z are not less loyal to all types of FMCG. There are top 5 FMCG product brands that are often being switched by this young generation, as shown on the graphic below.

The Influence of Ads

In this research, we found out that there are 9% of Gen Z said they purchase any FMCG brand(s) to buy because of interesting advertisement(s). According to the infographic, majority of this generation want to try purchasing the advertised brands because it sells a product that they need (53%), and 21% of them think the brands have the same values and style as theirs.

In sync with the previous info about Gen Z in a digital world, we figured out that Gen Z did in fact see these enticing advertisements on social media. Moreover, many of them discovered that watching ads on TikTok is significantly more entertaining rather than on any other social media platforms.