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Gen Z's Shopping Paradox: Skipping Chipotle to Buy Coach Handbags

MarketDash Editorial Team
12 days ago
Generation Z is cutting back on fast-casual dining while splurging on designer brands, leaving retailers scrambling to decode their unpredictable spending patterns. The trend toward "affordable affluence" reveals a generation choosy about where every dollar goes.

Retailers are pulling their hair out trying to understand Gen Z's shopping habits, and honestly, who can blame them? This generation will penny-pinch on a burrito bowl but drop serious cash on a Coach bag. Welcome to the era of "affordable affluence," as PwC calls it—a concept that sounds simple until you actually try to predict what Gen Z considers worth their money.

The Fast-Casual Fade

The warning signs are flashing at restaurants that used to be Gen Z favorites. Cava Group (CAVA) CEO Brett Schulman didn't mince words on the company's Q3 2025 earnings call earlier this month: "The younger cohort, that 25 to 35… they don't have the steam that they had last year."

Chipotle (CMG) is seeing the same pattern. "A particularly challenged cohort is the 25- to 35-year-old age group," CEO Scott Boatwright said on the company's Q3 earnings call in October. "We believe that this trend is not unique to Chipotle and is occurring across all restaurants as well as many discretionary categories."

Both executives pointed to the usual suspects: rising unemployment, crushing student loan payments, and wages that aren't keeping pace with living costs. When you're juggling all that, even a $12 Mediterranean bowl starts feeling like a luxury.

The Designer Surprise

But here's where it gets interesting. While Gen Z is ghosting Chipotle, they're showing up for designer brands in unexpected numbers. Tapestry (TPR), which owns Coach and Kate Spade, just raised its fiscal 2026 outlook after crushing Q1 earnings expectations with 12% sales growth in North America.

CEO Joanne Crevoiserat told CNBC that new customers are driving much of this growth, and most of them are Gen Z. "The Gen Z consumer, specifically, is highly fashion engaged, spending slightly more of their budget on fashion," she explained. Even better for Tapestry, these younger shoppers stick around. Crevoiserat noted the company sees high retention rates among Gen Z, "maybe busting a myth that these customers, Gen Z customers, aren't sticky or loyal."

So they'll skip lunch to save money, but a handbag that makes a statement? That's apparently non-negotiable.

The Waiting Game

Still, PwC's data shows Gen Z is generally more focused on saving than spending. About 80% of Gen Z shoppers wait for items to go on sale before buying, while only around 20% are willing to pay full price. That's patience most retailers aren't used to dealing with.

The numbers for holiday spending look equally cautious. Gen Z expects to reduce holiday spending by 23% this year, according to PwC's Holiday Outlook 2025 report. Many in this generation say their financial situation has gotten worse over the past year, which tracks with everything the restaurant CEOs are saying.

But before retailers write off Gen Z entirely, here's the twist: only 28% of Gen Zers said they'd be willing to cut back on high-value items over the next six months to save money. The challenge for retailers isn't that Gen Z won't spend—it's figuring out what they consider valuable enough to justify opening their wallets.

PwC nails the core problem: retailers need to identify what Gen Z deems high value and figure out how to position their products in that category. It's not about price points or demographics anymore. It's about understanding a generation that views spending as a form of self-expression, where every purchase is a statement about what matters to them. That Chipotle bowl? Forgettable. That Coach bag? An investment in their personal brand.

Back to News

Gen Z's Shopping Paradox: Skipping Chipotle to Buy Coach Handbags

MarketDash Editorial Team
12 days ago
Generation Z is cutting back on fast-casual dining while splurging on designer brands, leaving retailers scrambling to decode their unpredictable spending patterns. The trend toward "affordable affluence" reveals a generation choosy about where every dollar goes.

Retailers are pulling their hair out trying to understand Gen Z's shopping habits, and honestly, who can blame them? This generation will penny-pinch on a burrito bowl but drop serious cash on a Coach bag. Welcome to the era of "affordable affluence," as PwC calls it—a concept that sounds simple until you actually try to predict what Gen Z considers worth their money.

The Fast-Casual Fade

The warning signs are flashing at restaurants that used to be Gen Z favorites. Cava Group (CAVA) CEO Brett Schulman didn't mince words on the company's Q3 2025 earnings call earlier this month: "The younger cohort, that 25 to 35… they don't have the steam that they had last year."

Chipotle (CMG) is seeing the same pattern. "A particularly challenged cohort is the 25- to 35-year-old age group," CEO Scott Boatwright said on the company's Q3 earnings call in October. "We believe that this trend is not unique to Chipotle and is occurring across all restaurants as well as many discretionary categories."

Both executives pointed to the usual suspects: rising unemployment, crushing student loan payments, and wages that aren't keeping pace with living costs. When you're juggling all that, even a $12 Mediterranean bowl starts feeling like a luxury.

The Designer Surprise

But here's where it gets interesting. While Gen Z is ghosting Chipotle, they're showing up for designer brands in unexpected numbers. Tapestry (TPR), which owns Coach and Kate Spade, just raised its fiscal 2026 outlook after crushing Q1 earnings expectations with 12% sales growth in North America.

CEO Joanne Crevoiserat told CNBC that new customers are driving much of this growth, and most of them are Gen Z. "The Gen Z consumer, specifically, is highly fashion engaged, spending slightly more of their budget on fashion," she explained. Even better for Tapestry, these younger shoppers stick around. Crevoiserat noted the company sees high retention rates among Gen Z, "maybe busting a myth that these customers, Gen Z customers, aren't sticky or loyal."

So they'll skip lunch to save money, but a handbag that makes a statement? That's apparently non-negotiable.

The Waiting Game

Still, PwC's data shows Gen Z is generally more focused on saving than spending. About 80% of Gen Z shoppers wait for items to go on sale before buying, while only around 20% are willing to pay full price. That's patience most retailers aren't used to dealing with.

The numbers for holiday spending look equally cautious. Gen Z expects to reduce holiday spending by 23% this year, according to PwC's Holiday Outlook 2025 report. Many in this generation say their financial situation has gotten worse over the past year, which tracks with everything the restaurant CEOs are saying.

But before retailers write off Gen Z entirely, here's the twist: only 28% of Gen Zers said they'd be willing to cut back on high-value items over the next six months to save money. The challenge for retailers isn't that Gen Z won't spend—it's figuring out what they consider valuable enough to justify opening their wallets.

PwC nails the core problem: retailers need to identify what Gen Z deems high value and figure out how to position their products in that category. It's not about price points or demographics anymore. It's about understanding a generation that views spending as a form of self-expression, where every purchase is a statement about what matters to them. That Chipotle bowl? Forgettable. That Coach bag? An investment in their personal brand.

    Gen Z's Shopping Paradox: Skipping Chipotle to Buy Coach Handbags - MarketDash News