Gen Z health and beauty spend shifts from luxury to essential
Gen Z are the biggest spenders on health and beauty, with many now counting it as an essential part of their everyday spending rather than a luxury, according to RSM UK’s Consumer Outlook.
RSM’s survey of 2,000 consumers found that almost three-quarters (72%) of Gen Z count beauty, grooming or wellness as essential spending, versus 60% across all age groups, while 26% of Gen Z say it’s not essential but they’ll prioritise it over other discretionary spending.
Almost a third (30%) of Gen Z are spending more on beauty, grooming and wellness compared to last year, nearly double that of all consumers at 17%. This averages out at £45.20 a month on beauty, grooming and wellness products compared to £32.40 across all consumers. Over a third (35%) of Gen Z spend more than £50 a month, and within that, 5% spend over £100 a month.
Jacqui Baker, Partner and Head of Retail at RSM UK, said: “Health and beauty is no longer a luxury, it’s increasingly becoming an essential part of consumers’ everyday spending. It’s the one area that consumers refuse to cut back on and has consistently outperformed other retail categories which have experienced a slowdown in spending.
“This could stem from the “lipstick effect”, where consumers prioritise small, feel-good indulgences during times of economic downturn and weak confidence. However, the lipstick effect doesn’t exist across the board.
“The rising popularity of health and beauty is particularly prevalent among younger consumers, who as the first truly digital-native generation, grew up in a world shaped by social media and image-led platforms. It’s also driven by higher-income consumers who continue to invest in their personal wellbeing and appearance, while lower-income households remain constrained by financial pressures.”
Robyn Duffy, Consumer Markets Senior Analyst at RSM UK added: “While the health and beauty world is resilient, it’s growing at a rapid pace, with new innovations and changing consumer behaviours making it extremely competitive. Businesses that are best placed to succeed will be those investing now for the consumer of tomorrow, rather than simply serving the consumer of today.”