The influence of WOM and Peer Interaction in the Decision-Making Process of Generation Z within the family

Abstract

Generation Z is the first generation who has grown up in the middle of an era of developed information technology, being one of the most critical users of social networking sites (SNS), constantly engaging in online exchanging of information and conversation between peers. The study of this generation’s consumer behaviors is an opportunity for marketers to get to know their preferences, identify the major influences on their decision-making process, and understand how to target them more effectively.

In this paper, we designed a survey to study the effect of peer interaction and word-of-mouth (WOM) on the different stages of Generation Z’s decision-making process, and to understand how this generation’s preferences are formed. Data was analyzed through Confirmatory Factor Analysis and Structural Equations Modeling. Results showed that peer interaction positively influences Generation Z’s decision-making, most predominantly in the first stages of the process, while the influence of WOM was not statistically supported. Other factors should be considered in the future, to uncover the different determinants of generation Z’s decisions, so that marketers can develop more accurate strategies to best target this younger generation.