Retailers Target Gen Alpha as AI Reshapes Shopping

During the holiday season, retail leaders and parents converge around a priority: identifying what children desire this year. Their inquiries may range from pinpointing trending toys to understanding broader expectations for the shopping journey. As the earliest members of Generation Alpha, born circa 2010, begin to obtain driver’s licenses, the industry’s focus is moving away from Generation Z and toward the next wave of consumers.

Currently, both Gen Z and Gen Alpha are under scrutiny. The boundary between these generations is blurred, and they share numerous traits. Teenagers from both groups are budget-conscious, tech-savvy, and fond of in-store shopping. Despite limited financial resources, they significantly influence family purchasing decisions and have been exposed to AI from a young age.

“First was millennials, which were sort of the first digital generation. Then there was Gen Z, which was the first social media and iPhone generation, and now it’s Gen Alpha, which is going to be known as the AI generation,” said Matt Britton, founder of AI consumer intelligence platform Suzy and author of “Generation AI: Why Generation Alpha and the Age of AI Will Change Everything.”

“They’re the first generation to grow up with AI in the household, and it’s rewiring their brains in a way that’s going to make them distinct,” Britton said.

Opening the Internet’s ‘New Front Door’

Still, it would be a mistake to treat all members of Gen Alpha the same way. Like any generation, there are different cohorts with different preferences within the demographic’s borders. One group was focused on influencers and self-expression; another on celebrities and pop culture characters; a third on trends and appearances; and a fourth on the environment and social concerns.

However, this is not entirely accurate, and there is no single approach that suits all Gen Alphas or Gen Zs.

New Front Door for Discovery

The shopping experience for young consumers has undergone a significant shift. Traditional search engines are no longer the primary means of discovery. Instead, AI chatbots are taking over, making it essential for retailers to develop a full AI strategy. Matt Britton explains that the old method of searching on Google, seeing an ad on Instagram, and then making a purchase on Amazon is no longer the dominant approach.

Britton states that ‘the internet now has a new front door.’ Retailers must invest in new discovery channels, such as AI-powered gift finders. For instance, Target launched an AI holiday gift finder in 2025, and Kohl’s introduced a similar tool earlier this year.

Issues with actually buying products — such as ChatGPT encountered with the debut of its Instant Checkout shopping experience — are likely short-lived, according to Britton. What becomes more important in this environment is one of retail’s fundamental rules: building an emotional connection with shoppers outside of the transaction. AI doesn’t understand the emotional reasoning that drives purchases “because AI has never had its heart broken or felt envy or jealousy,” Britton said. “When you think about authenticity, think about content and the creator economy and how your brand is perceived — I think that happens still largely outside of the world of AI.”

The reliance on AI is not unique to Gen Z and Gen Alpha. A study by Attentive found that two-thirds of shoppers have used AI to make a purchase in the last three months, rising to 80% for Gen Z shoppers. AI reinforces the desire for personalized experiences among these groups, who have grown up with tailored recommendations and products.

They’ve adopted cocreation and see products as a method of self-expression, Gen Z Planet founder Hana Ben-Shabat said via email. Anything that can tap into that desire for creation and personalization will likely play well with young shoppers, she noted. Not all of the methods for connecting with a chronically online generation have to be driven by AI, either. Retailers can also invest in tools that allow kids to more easily save products from social media sites and other places they frequent and share those with parents, Ben-Shabat said.

They do not fully comprehend the risks associated with AI, despite being accustomed to using it.

Using stores to ‘break the mold’

As embedded as digital tools are in young shoppers’ lives, there is also a growing fascination with all things Y2K. And there’s almost nothing more 2000s than the mall. Like Gen Z before them, Gen Alpha has a penchant for in-store shopping. Look no further than the Sephora kids phenomenon to see the enduring interest in physical retail for young shoppers.

E.l.f. Both brands are capitalizing quickly on new trends. Piper Sandler’s annual Taking Stock With Teens survey found E.l.f. Cosmetics topped the list of cosmetics brands that teens are shopping, while Sephora was the No. 1 beauty destination for that group.

Human Connection vs. Screens

Shoppers are using large language models, but they are starting to realize the technology knows them a little too well. In this context, physical stores offer a way to “break the mold” and make different choices, Miller said. Gen Z, the youngest generation JLL studied, are the most eager to opt out of things like personalized recommendations. About 45% of them said that online recommendations limit what they are allowed to like.

When they shop in person, they are more interested in getting away from their devices than using more screens and technology in a store setting. “We want it to be sensory. We want it to be tactile. We want to have human connection,” Miller said.

Overstimulation caused by in-store screens and other tech is a serious deterrent for shoppers across generations, according to Miller. JLL found that 72% of consumers left a store earlier than planned because they were overwhelmed. This metric jumps to 81% for the neurodivergent population. Miller sees that only growing as people’s everyday lives become more stimulated.

Piper Sandler’s teen survey, released last fall, listed Nike, Brandy Melville and Coach as some of the most popular apparel and accessories brands for the cohort. Nike just this summer launched a new fleece line marketed at young shoppers. Coach has talked extensively about its efforts to court Gen Z through personalization and unique store experiences.

Global Trends Matter Most

Earning teens’ roughly $2,200 in annual spend is a complex effort. It requires staying on top of what is hot, which is changing even faster nowadays as young people are more connected to global trends. “And it’s probably coming from all different corners of the world, not just from the U.S. or locally.”