As Gen Z‘s footprint in the Indian workforce expands, so does their collective economic influence. Comprising over 40% of the nation’s population, this demographic is on track to drive 46% of India’s total consumer spending—reaching a projected $1.8 trillion by 2035, according to research by Boston Consulting Group (BCG) and Snapchat. This massive shift in purchasing power is coinciding with the rise of AI-driven retail, which is transforming the shopping experience into a highly personalised journey for every consumer.
And with growing financial power comes a spending surge. BCG predicted that every second rupee spent by Indians would be by Gen Z by the next decade. In fact, the multi-generational households dominating India report that the $860 billion consumer spending is driven largely by Gen Z. And as more brands, platforms, and campaigns call out to Gen Z as the next big consumer segment, the focus has shifted towards the principles they stand by.
To better understand this growing Gen Z preference for personalised and interactive experiences, Amazon India shared its insights in response to queries from Financial Express Online.
How Gen Z uses AI to decide what they wear
While fashion is more than just clothes, it is a social choice made by individuals; AI-integrated platforms have changed the narrative of this selection. In fact, the Indian Fashion Retail Outlook 2025 report from BlueWave Consulting revealed that India’s retail market is projected to reach $140 billion by 2030, fueled by an AI forecast, managing both consumers and businesses.
“Gen Z increasingly approaches fashion and beauty as a combined expression of identity,” said Nikhil Sinha, Director – Fashion, Amazon India.
Speaking to financialexpress.com in an email interaction, Sinha shared, “We are seeing a clear shift in how younger customers engage with fashion — from traditional keyword-based search to more visual, conversational, and assisted discovery journeys.”
This shows how exploration patterns and the search itself are changing into a dynamic rather than static shift in consumer behaviour. In fact, a 2025 survey conducted over 1000 consumers in the US, UK, and Australia, by Commerce, revealed that 33% of Gen Z prefer AI platforms for product research. However, in India, 72% of Gen Z looked up to creators and influencers for shopping inspiration in 2024.
Adoption of AI – Beyond baskets
While a large section of the retail population is moving towards AI to search, does it help make the final decision?
Imagine the holiday season, you are rummaging through your closet to find that one outfit that won’t just be ‘corporate casual’ for your vacation or scrolling through endless apps to find the right gift for Mother’s Day, that’s where AI flips the script.
According to a recent September 2025 report from PayPal, it helped reveal that 61% Gen Z shoppers in the US have used AI to help with purchases over the last year. Half of Gen Zers and 49% of millennials would hand over gift-buying responsibility to AI if it meant avoiding stress, according to a November Mastercard and Harris Poll survey, it revealed.
Supporting these insights, Amazon India’s Sinha further told financialexpress.com, “Today, 1 in 3 Gen Z shoppers on Amazon Fashion are using [AI] to search for trend-driven fashion and styling inspiration, indicating a move toward more intuitive, AI-led discovery.”
Moreover, Sinha added, “Beyond discovery, [AI] also helps customers make more informed decisions — providing contextual insights such as product details, comparisons, and price history visibility over the past 30 to 90 days, helping customers assess value and timing of purchase more effectively,” and shared how AI impacts the basket business for consumers.
In fact, in January 2025, Capgemini revealed, “Two-thirds of Gen Z and millennials want hyper-personalised content and product recommendations, powered by Gen AI,” the demand of which has increased from the previous 25% in 2023.
“Consumers today want personalised shopping experiences, enhanced by AI and generative AI. In addition, they expect fast and efficient deliveries and have become more conscious of their purchasing impact,” said Lindsey Mazza, Global Retail Lead at Capgemini.