Next-gen shoppers: How Israeli Gen Z integrates Al, digital payments, and social influence
Visa survey shows digital payments dominate while social media and influencers drive purchasing decisions.
A recent consumer survey indicates that approximately 90% of Generation Z individuals in Israel use Artificial Intelligence (AI) for shopping-related purposes. Concurrently, digital payments, including digital wallets and mobile applications, are identified as the primary payment method for roughly 70% of these respondents , both online and in physical stores.
These findings emerge from a survey conducted by Visa, in collaboration with Geocartography Group. The study focused on the shopping and payment habits of Israeli Generation Z, encompassing individuals aged 16-28.
Generation Z is becoming a pivotal force, expected to significantly impact future commerce due to their digital fluency and unique shopping habits. Characterized by high AI adoption for shopping (nearly 90%), a preference for digital payments (70%), and significant influence from social media (70% buy based on recommendations, 54% due to influencers), they navigate a hybrid retail landscape. This generation also demonstrates strong social and environmental awareness, with two-thirds believing their consumption can drive change and over half preferring socially conscious brands. While mobile phones are integral to their lives and shopping journeys, they often combine online and physical store experiences.
Digital payments are used extensively by this demographic. Respondents utilize mobile apps for payments over 11 times a month, and contactless cards are used more than 9 times monthly. When making online purchases, 95% prefer using credit cards. Nearly 7 out of 10 respondents consider digital payments online to be safe or relatively safe. Approximately two-thirds (66%) express confidence in their ability to manage finances digitally, understand economic concepts, and compare prices. About 80% feel capable of finding and understanding financial concepts and researching risks such as online fraud, with men showing slightly more confidence than women (68% vs. 59%).
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The survey highlights the integration of AI into shopping habits, with about 90% of Israeli Gen Z respondents using AI tools. Their primary applications include comparing products and gathering additional information. Approximately one-third use chatbots as shopping assistants, and men tend to use AI for shopping slightly more than women (40% vs. 33%). About half (50%) trust AI recommendations as much as, or more than, suggestions from friends and family. Gery Lasky, Visa's Global CEO in Israel, stated, "AI is on the rise to become an essential 'personal shopping assistant,' and Visa is working together with key players in the field to integrate secure payments with AI assistants – a move that will revolutionize e-commerce as we know it today."
Social networks play a role in this generation's purchasing habits. Around 70% have bought products based on social media recommendations, with women reporting higher rates than men (79% vs. 58%). More than half (54%) admit to making purchases influenced by influencer promotions, with women again showing a higher propensity (69%) compared to men (40%). Mobile phones are considered an integral tool; about 74% report discomfort or disconnection if separated from their device for even a few hours. 81% view their mobile phone as a vital tool throughout their shopping journey. Over half use their phone for most, if not all, payments, and 57% multitask while shopping online.
Beyond technology, Israeli Gen Z demonstrates consideration for social and environmental issues. About two-thirds (67%) believe their consumption habits can influence environmental change, and over half (57%) prefer brands that support social or environmental causes. Approximately 24% investigate brand values like sustainability when considering expensive purchases.
Regarding shopping channels, over half (55%) of Gen Z combine online and physical store shopping. Only 12% prefer online shopping exclusively. Reasons cited for online purchases include convenience, better prices, and a wider product selection. For specific product categories, physical stores remain the preferred option. Israeli Gen Z largely prefers to buy groceries (85%), shoes (80%), and household goods (76%) in physical stores. Conversely, they are more likely to purchase tickets for shows (82%), vacations, and flights (84%) primarily online.
