Data from the SM Store, the department store unit of SM Retail, showed a 13-percent increase in Gen Z in-store purchases in 2024, reflecting a shift in consumer behavior, as young shoppers increasingly turn to physical retail for experiential buying.
According to Jonathan Ng, executive vice president at SM Retail, the uptick is part of a broader strategy to meet the evolving preferences of a new generation.
Focus on evolving consumer preferences
“Our strategy has always been ‘We’ve got it all for you.’ SM Store offers a broad product range that appeals to different market segments, making it a one-stop shop for all. We’re also placing greater emphasis on engaging with Gen Z,” Ng said.
While Gen X (ages 45–60) and Millennials (ages 29–44) still hold the largest purchasing power, SM Retail is making strategic investments to tap the influence and rising spending capacity of Gen Zs (ages 13–28), who now represent 38 percent of the Philippine population, based on recent data from the Philippine Statistics Authority.
A 2024 consumer behavior report by The Fourth Wall and Uniquecorn Strategies found that 31 percent of Filipino Gen Zs prefer shopping in brick-and-mortar stores, driven by the ability to touch, try, and instantly purchase products. This finding is supported by a January 2025 global report from Adyen, published by Retail Dive, which revealed that nearly 75 percent of Gen Z consumers worldwide shop in person at least once a week.
Experiential shopping
“Filipino shoppers, especially Gen Zs, are more experiential and tactile in their shopping preferences,” Ng added. “At SM Store, we are dedicated to evolving to meet these expectations, investing in modern store designs and enhancing customer service to stay ahead of the curve.”
In-store experience has become a major focus for SM Retail, which has rolled out initiatives like collaborations with lifestyle brands including Coffee Bean and Tea Leaf (CBTL) to elevate ambiance and encourage longer visits. The brand also prioritizes customer-centric features, such as personal shoppers and curated promotions, enhancing convenience and engagement.
Strong results
This renewed focus on Gen Z and in-store enhancements is not just a trend—it’s translating to strong business results. In 2024, SM Retail posted a net income of P20.9 billion, up 5 percent from the previous year. Retail revenues reached P434.5 billion, also up 5 percent from P412.9 billion in 2023.
As Gen Z continues to mature into a dominant consumer force, SM Retail’s proactive approach positions it as a key player in the evolving Philippine retail landscape. With innovation, inclusivity, and customer experience at the core of its strategy, SM Store remains a retail destination that resonates across generations. — Ed: Corrie S. Narisma
