Retailers Eye GenZ’s Money With a Big Push Onto College Campuses

Coffee shops and bookstores are college-campus staples. Now retailers selling apparel and candles are looking to get in on the action too. 

Companies eager to capture Generation Z’s spending power hope campus locations will draw younger consumers to their goods and establish their brands with tomorrow’s adult spenders, with mall-based stores and other chains planting their banners in collegiate settings. 

Teen fashion retailer Pacsun and creams and candles purveyor Bath & Body Works (BBWI) last month announced forays into hundreds of campuses. Pacsun is setting up pop-up shops to market “must-have” styles to students. Bath & Body Works said it’s opening more than 600 campus stores nationwide, “marking its largest distribution effort outside its own retail locations.”

The move “allows us to reach our Gen Z customers where they are and when they need us most,” said Betsy Schumacher, chief merchandising officer with Bath & Body Works.

Convenience store chain Wawa opened a standalone store in the heart of Villanova University’s campus last month. Its counterpart Buc-ee’s now sells some products at stores at Texas A&M.

“Collectively, students have huge spending power,” said Neil Saunders, retail analyst and managing director at GlobalData Retail. “Retailers want to tap into that.”

Retailers Are Looking to ‘Follow the Money’

The spending heft of Gen Z, the fast-growing shopper demographic, is projected to grow to an estimated $12 trillion by 2030, according to market research firm NIQ.

“Retailers are looking for locations where they can follow the money,” said Walter Holbrook, a retail-industry consultant. “Gen Z, all of a sudden, now have their charge cards and they’re ready to spend some money.”

Colleges are also seen as good for building brand recognition and loyalty, according to Saunders. 

“Students have spending power in the here and now, but they are also the consumers of the future,” said Saunders. 

On Georgia Tech’s campus in Atlanta, for example, Amazon (AMZN) has on-campus lockers for delivery pick-up. Its Prime Student offering, meanwhile, advertises half-price membership for shoppers aged 18 to 24. The company, said Barry Thomas, senior thought leader with Kantar.is building “potent shopper rituals with the Amazon brand on campuses.”

Retail experts say many brands are looking for creative ways to expand their footprints that have a shot at attracting younger consumers less hardwired to shop at malls than previous generations but who haven’t given up entirely on the in-store experience.

Some companies have taken note of places where they send a lot of deliveries and determined that those locations could support a store, according to Holbrook.

“Retailers are getting creative about where they open new shops and the audiences they try to address,” Saunders said.