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Planted 02021-10-08

Explaining the rise of Shein in the time we’re told Gen Z customers buy for a higher-order purpose.

They’re looking beyond tangible products and actually trying to understand what is it that makes the company tick. What’s its mission? What’s its purpose? And what is it actually trying to build for us as a society? Bo Finneman, McKinsey partner

They want to actively share their opinions, collaborate, and co-create with brands. In the process, they expect brands to be highly responsive to their needs. Pragmatic and alert to unfounded hype, Gen Zers also want brands to be transparent, trustworthy, authentic, and relevant. Retailers or consumer goods companies must establish an environment of trust when reaching out to this unique generation of consumers. What do Gen Z shoppers really want?, IBM

This model of “Gen Z” cannot explain the rise of Shein–an intangible company that works in the shadows and is the opposite of transparent, trustworthy, and authentic.

So, how can we explain the rise of Shein in the time we’re told Gen Z customers buy for a higher-order purpose?

Because people like us do things like this.

Because ideas that spread, win.

Because the lowest monetary price spread fastest.

And because it plays in the shadows–it works hard to hide how selfish it is and how opposed it is as a company and category to the oft touted higher-order purposes.

So, how to explain the rise of Shein?

Shein has been able to hide their social-costs that enable the low-cost, and that low-cost differentiation helped them spread throughout youth like wildfire.

Business Insider got it right.

When deciding where to shop, their primary motivator is price. Since they frequently document their life on social media, they feel a pressure to always have new clothes. That is fueling growth in unconventional forms of shopping, like rental and resale. Being unique — and balancing that with saving money — is a defining trait of this generation. Business Insider

Generational segmentation

Segmentation is valuable when segments achieve homogeneity–a sort of similar cohesion.

Generational homogeneity almost certainly doesn’t exist.

In Puncturing the Paradox: Group Cohesion and the Generational Myth, Harry Guild of BBH Labs, reports “The truth is that these ‘generations’ are simply random collections of people who share no special connection beyond being born within two decades of each other.” And ends with, “Let’s grow up and stop playing the generation game.”

“Gen Z” is not a meaningful segment.

How Pew Research Center will report on generations moving forward