There is no denying that the fashion industry is facing an uncertain year ahead, as leading fashion brands seem to have reached a bump. Opportunities for growth remain on the horizon, but the economic instability and changing consumer behaviours and interests mean that change should be smartly endorsed by these brands, including the target audience they have long bet on!
According to “The State of Fashion 2025” report co-published by McKinsey & Company and the Business of Fashion (BOF), fashion brands have long focused on young consumers. This focus is partially justified by data that highlight their increasing spending power compared to youth in previous decades.
But this improved financial state is perceived differently by the youth themselves. Gen Z suffers from “Money Dysmorphia,” a condition where someone is negatively or unrealistically insecure about his/her finances. Youth are facing increasing economic pressure and growing financial uncertainties. They are also accumulating debt faster than any other generation. Deloitte’s 2024 Gen Z and Millennial survey shows that globally, around one third of Gen Zs (30 per cent) feel financially insecure and over half (56 per cent) are living pay cheque to pay cheque
Moreover, and despite their financial capabilities, youth are becoming more difficult to sell to given the changing relationship they have with fashion brands. Their growing interest in fitness and their pursuit for comfort led to the emergence of athleisure, which became a new daily apparel for many consumers. According to the Global Web Index, 68 per cent of Gen Z customers in five markets wear athleisure multiple times per week.
In Saudi Arabia, this generation makes up around one-quarter of the total population, the second largest after the Millennials. Referred to as “Digital Natives,” Gen Z is the first generation growing up digitally literate. Saudi Gen Zs are the least loyal consumers. According to the Global Web Index (GWI), only 28.4 per cent of Gen Z in Saudi Arabia are loyal to brands they like, compared to 56 per cent among their global peers, and they don’t feel connected, as only 14.8 per cent feel represented in the brands communication. Additionally, young consumers feel overwhelmed by the volume of brands trying to target them. Globally, 80 percent of Gen Z shoppers feel they are exposed to more brands and ads than any other generation, and perhaps it is this exposure that pushes them away.
Gen Zs continue to be the primary target of many fashion brands
Still, fashion brands consider Gen Zs as their target consumers. According to “The State of Fashion Sector in Saudi Arabia 2024” report, the fashion industry in the Kingdom is thriving. Currently, the sector stands at USD 30 billion market opportunity, projected to reach USD 42 billion in 2028. Youth have long been considered the consumers of today and tomorrow, but they are redefining Saudi’s fashion preferences by combining global trends with a profound respect for cultural heritage. As such, luxury and non-luxury brands are trying to find balance between international appeal and respecting Saudi culture to appeal to these young but opinionated consumers. A report by the Future Laboratory and Together group found that “a significant 95 percent of affluent Saudis aged 18-34 believe it’s important to support and engage with Saudi-first businesses, celebrating local craftsmanship and design”. As such, luxury brands like Dior, Gucci, and Louis Vuitton are creating exclusive collections for the Middle East and international brands, like adidas, is investing in meeting the needs of the young shoppers in the country while respecting their culture and identity. But is this enough to drive sales?
Amid the challenge to drive sales from younger shoppers alone, an eye towards targeting a once-dimmed generation – the consumer group aged 50 and above, named the “Silver Generation” – cannot be overlooked if fashion brands are to thrive.
The “Silver generation” opportunity
A growing consumer group aged 50 and above, named the “Silver Generation,” in reference to their grey hair, of fashion consumers is emerging. Globally, this group has a higher share of global spend at 38 per cent in 2024. It represented 25 per cent of the global population in 2020, but longer life expectancies are driving this age group to grow more rapidly compared to any other age group.
In 2050, the Silver Generation is expected to represent more than a third of the global population. Even countries with a large young population will observe a similar trend. In Saudi Arabia, the share of the population aged over 50 will almost double between 2025 and 2050, accounting for one fifth of the total population according to the United Nations World Population Prospects 2024. “The State of Fashion” report view the “silver generation” as more affluent, resilient, and spends more on fashion. Therefore, brands must cater to their growing needs.
GWI data analysed by Webedia shows that the Saudi Silver Generation are experience-driven, as 64 per cent are willing to spend more money on experience. They also prioritise personal looks, with around half (49 per cent) expressing that they like to take care of their appearance. They tend to be more loyal to brands than the average Saudis, (35 per cent vs 31 per cent) and more than half value brands that are reliable (63 per cent), authentic (57 per cent) and innovative (48 per cent), while less are trend-driven, with one-third looking for brands that are trendy/cool. They prioritise functionality and are quality driven, as 55 per cent would be most motivated to promote a brand that is of high-quality.
An inevitable generational shift for brands
For brands to win and achieve intergenerational appeal, they need to tailor their marketing, channel, and product strategies by rethinking customer segmentation and diversifying the product portfolio. They must recognise values and interests that connect customers across different age groups and develop products that cater to both the young and older generations. For the Saudi market, as brands focus on the youth as the main drivers of growth, they need to start planning for a future where the older and more affluent generation will make up a larger portion of the population.
By Yasmine Koujou, Senior Data and Research Specialist at Webedia Arabia
