Supermarket News Mentions First Insight | Study Finds Gen Z Still Prefers National Brands, But Shifts Spending Across Categories
A new study by global retail platform First Insight finds that Gen Z consumers continue to prefer national brands across consumer packaged goods categories, even as many adjust their spending habits to balance cost and quality.
The report, “Is Gen Z still choosing your brand? Here’s what’s quietly changing across CPG”, is based on responses from 2,151 consumers ages 18 to more than 80.
Researchers found that Gen Z ranked national brands as their top purchase choice in every category tested, ahead of store brands, premium products and direct-to-consumer alternatives. However, 59% of Gen Z respondents said they reduce spending in some categories to afford higher-priced items in others. Staples such as food, beverages and household goods are among the most common areas for cost-cutting, while health and wellness and beauty products are more likely to receive premium spending.
About 31% of Gen Z respondents said they are most likely to purchase store-brand food and beverages to save money, and 24% said the same for household goods.
The study also found differences in how generations perceive brands. Gen Z respondents were less likely than baby boomers to identify national brands as the most noticeable option when shown product images. For example, 68% of boomers said a national brand stood out first in a household cleaner comparison, compared with 44% of Gen Z. Similar gaps appeared in categories including facial cleansers, dog food and vitamins.
Despite this, Gen Z still ranked national brands highest when asked about purchase preference.
The report suggests that national brands may be losing consumer attention at earlier stages of decision-making. In one example, the skincare brand CeraVe was identified as standing out to 52% of Gen Z respondents, but only 33% expressed interest in learning more about it. By contrast, the direct-to-consumer cleaning products company Blueland was initially noticed by 18% of respondents, while 30% said they wanted to learn more.
Researchers said this pattern indicates reduced engagement rather than outright rejection of established brands. Ratings for “least likely to choose” showed minimal differences between Gen Z and the broader population.
The findings align with earlier research from the company showing that 45% of consumers reported permanently switching from national brands to store brands when product quality met expectations.
Price and quality remain the primary factors influencing purchasing decisions, though their importance varies by category. Price was the leading factor in food, beverages and household goods, while quality ranked highest for skincare, beauty and health and wellness products.
The study also found that discount retailers are playing a larger role in grocery shopping. Forty-two percent of Gen Z and Generation X respondents and 40% of millennials said they had purchased food or beverages from chains such as Dollar General and Dollar Tree in the past month, compared with 25% of boomers.
Subscription-based purchasing is more common among younger consumers. About 75% of Gen Z and 72% of millennials reported having at least one product subscription, compared with 45% of Generation X and 31% of boomers. Among those who subscribe, discounts, exclusive products and convenience were cited as the primary motivations.
The report also identified three common Gen Z shopping patterns: they focus on value, they prioritized identity-driven purchases such as eco-friendly or premium goods and they rely on familiar brands, particularly in categories like pet food.
Researchers noted that similar behaviors are present among millennials, who report comparable trade-down habits and show high interest in subscription services, particularly in food and beverage categories.
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