Younger Generations Projected to Drive 40% of Fashion Spending by 2035, According to BCG and WWD Report
Photo Credit: Boston Consulting Group (BCG)
BOSTON, October 29, 2025 (FASHION BEAUTY SCENE) – Management consulting firm Boston Consulting Group (BCG), in collaboration with fashion industry publication Women’s Wear Daily (WWD), has released a new report projecting that Generation Z and Generation Alpha will account for 40% of all fashion spending by 2035. The findings are based on a survey of more than 9,000 U.S. consumers and an analysis of over 50,000 social media posts.
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The report, titled How Gen Z and Gen Alpha Are Rewiring the Fashion Industry, highlights how these younger consumers are reshaping fashion through artificial intelligence (AI), social influence, and evolving definitions of brand loyalty. According to the report, Gen Z and Gen Alpha spend approximately 7% more of their disposable income on clothing and shoes compared to older generations.
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“Younger consumers represent one of the most powerful spending forces in fashion, yet they are also the hardest to win and keep. Their shopping patterns are fluid and unpredictable, driven by a search for brands that reflect their values and identities while maintaining cultural relevance. Winning them over represents a defining opportunity for brands to build long-term loyalty,” said Mrin Nayak, Managing Director and Partner at BCG, and coauthor of the report.
“This is a defining moment of opportunity for brands to engage a new generation of consumers in more meaningful ways. Gen Z and Gen Alpha are reshaping the fashion landscape through new expectations around authenticity, personalization, and digital innovation. WWD is proud to partner with BCG on this report to help the industry understand these shifts and translate insight into action and growth,” said Amanda Smith, CEO of Fairchild Media Group, which includes WWD, Beauty Inc, Footwear News, and Sourcing Journal.
The report found that younger consumers are 1.5 times more likely than older generations to discover brands through social media, viewing digital creators and influencers as equivalent to traditional celebrities. Micro-influencers with fewer than 100,000 followers have nearly the same influence on purchasing decisions as celebrities with over one million followers, with 22% of younger consumers citing micro-influencers as a key source for brand discovery.
According to the report, AI is also emerging as a major influence in fashion shopping habits. While millennials and older consumers use AI slightly more overall (58% versus 51%), Gen Z and Gen Alpha are more likely to use AI specifically for fashion shopping, at 41% compared to 34% of older generations. Younger shoppers use AI to identify trends, receive styling suggestions, visualize outfits, and compare prices, establishing AI as what the report calls a “trusted co-shopper.”
According to BCG and WWD, Gen Z and Gen Alpha show lower brand loyalty but higher product loyalty, favoring distinctive products over repeat purchases from the same brand. Nearly half of respondents in these generations expect personalized attention and customized recommendations from brands.
The report was presented during the WWD Apparel & Retail CEO Summit, marking WWD’s 115th anniversary.
For more information or to download the full report, visit www.bcg.com/publications/2025/how-gen-z-gen-alpha-rewiring-fashion-industry.
Source: Boston Consulting Group (BCG)
