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But for now, let's get back to Generation Z, who are nearly all hooked into the subscription models. They dominate nearly everything they do, including when they first wake up. But it isn't just their phones. If it's a weekday, most people in Generation Z will either be heading to school, college, or work, and most of ... |
Music is yet another massive industry that has fully embraced the subscription model. At first, it just wasn't feasible. The rise of Napster and other file-sharing services made getting free music incredibly easy to access, as long as you knew how to use a computer. The problem was there really wasn't any way to moneti... |
Consumers got a rough deal as well. You see, most people don't actually listen to tons of new music all the time—they just listen to their favorite songs over and over. And as a result, Spotify's algorithms are designed around this, rarely promoting music people haven't heard already. Most people end up getting the sam... |
Even subscription services that let you make concrete purchases don't actually grant you ownership of anything. Sony clearly demonstrated this in 2023 when they removed tons of Discovery shows from people's digital libraries, even though they'd already bought them. |
In fact, we've actually lost so much with the subscription revolution, including the basic idea of ownership itself. Meanwhile, companies can abuse the many tricks that are now possible with this business model, as it's just so much easier to lure people into subscription models. Giving out free CDs or free samples of ... |
Some companies like Amazon set up traps by making a subscription the default option for some of their products. Meanwhile, they call it "Subscribe and Save," implying they're doing all of this to save you money. And it's a problem that's growing surprisingly fast. Unused subscriptions went from costing the UK £306 mill... |
The focus changes from the consumer making the active choice to buy something again to the consumer choosing not to continue paying. Even upsetting is easier with subscription services, as lots of companies artificially restrict features, gatekeeping them for a more expensive premium plan. And if that's not enough, the... |
These companies have learned that, despite the backlash, they often end up making so much more money from the people who stick around compared to the customers they lose. All this, and now so many companies are doing this, the actual service on offer has gotten so much worse. There was a short period in time where a Ne... |
So Generation Z are already on the back foot. Unlike previous generations, they don't own things like their music, and even without inflation, they're going to be paying far more than previous generations did for the exact same things. |
But unfortunately, subscription models aren't the only thing that's changing. Lots of the older members of Generation Z, after going through their morning routines, will end up at work. But lots of Generation Z is already checking out of the system, because no matter how much they work, it isn't going to make their liv... |
A Bank of America survey of their adult Gen Z customers showed that over half didn't even have savings to cover just 3 months of expenses. 46% have also had to rely on their parents or family financially just to get by. They're living paycheck to paycheck—one or two bad days could financially ruin them. They're the one... |
Since 2022, credit card balances for Generation Z have increased by more than 50%. The average balance for someone aged 22 to 24 in 2023 was nearly $3,000—26% more than it was for Millennials at the same age just 10 years ago. And at the same time, delinquency rates have also risen as well. |
These aren't signs that Generation Z are naturally careless or looser with their money compared to Millennials—more so, it's the conditions that have changed. They're simply squeezing them harder. It all means that a larger part of Generation Z are working just to pay off their debts and survive. There isn't any room f... |
Every young person knows just how hard it is to get a job in the modern world, especially when you're fresh out of school or university. Even the lowest-paying jobs are becoming even harder to get nowadays. In fact, it's not uncommon for companies to force people into multiple interviews, team-building exercises, and o... |
Sites like LinkedIn have monetized this process and make more money the harder the whole process is. Whole industries have sprung up to take advantage of the desperate people just looking for stable work. Eventually, if you're one of the lucky few that does get a job offer, then all it does is elevate you to the first ... |
The commute home is yet another example of this. It's another subscription service—again, this time though it's mandatory for all but the richest. Either you travel on public transport, which in some cities can cost as much as your rent, or you use a car—something that most Gen Z can only buy with credit. Today, even a... |
They've actually started integrating further subscription plans into the cars themselves. Until recently, BMW were planning to lock their heated seats behind a monthly paywall, even though the feature was already built into the car—showing the absurdly dystopian levels of how far the practice of blocking off things tha... |
Companies are always trying to erode the will of consumers to resist these creeping changes. They only roll them back when they get such a massive backlash that it will actually impact their sales. |
Once they're home, Gen Z are then confronted by yet another thing they won't own—which should be obvious at this point. If you don't have any hope of owning your own music or a car, then a house or a flat is definitely out of reach. The average price of a home in the UK has nearly reached £300,000, and similarly in the... |
But just on average, Generation Z first-time buyers will pay over £100,000 of mortgage repayments in the first 5 years—yet not that long ago, people only paid about £74,000 in today's money for exactly the same thing. And that's only if they can actually convince a bank to let them buy a home in the first place. |
But most people aren't buying homes in the middle of nowhere. If you're trying to make money and get a good job, you end up in a city where you just can never save any money. And these high rents mean that most people in Generation Z will never have enough savings for a deposit. And banks today want you to easily be ab... |
As your position and security in society is purely based on who your parents were, and as these assets' value rises, it means it will always be completely out of reach for most people in society—and only in reach for people who inherited it. |
I think a lot of people know there's fundamental intergenerational inequity, which is because salaries are taxed very highly, and wealth—particularly capital gains from your main property—are barely taxed at all. And that leads to, I think, a kind of absurdity—which is that one piece written about this is: it's not act... |
And now, as we're reaching the end of the day, most people from Generation Z will be relaxing with TV shows, films, and music—that most likely come from yet another streaming service and a subscription plan. But for lots of Generation Z, it goes even further than that. Many of them won't even own the TV they're watchin... |
It's all part of yet another evolution in the anti-ownership economy: buy now, pay later schemes. At first, nobody expected this to ever take off—even the supposed experts in the field. It all began in 2008 when three students from the Stockholm School of Economics competed in a university entrepreneurship competition.... |
Despite losing the competition, their confidence remained unshaken, and they founded the company anyway. And after months of work, they finally found investors to join. Three years later, their new company, Klarna, had already expanded from Sweden into the rest of Europe, and today they're aiming for an IPO valuing the... |
Now, this might be a great story for the founders, but it wasn't for the rest of the world. The rise of Klarna represents the rise of a new type of consumption: taking out debt for trivial purchases. These so-called buy now, pay later schemes are the apex of this entire problem. Debt and a lack of ownership fuel endles... |
And tragically, this isn't the only reason people use these loans. The more desperate often rely on them for groceries and everyday essentials. It means that lots of Generation Z don't even own the food in their own fridge. |
All the things we've discussed today are part of a global movement that's eroding the very idea of ownership itself. While Generation Z is bearing the brunt of it, it's still something that affects all of us. In many ways, it's a necessary consequence of inequality—the fact that a smaller and smaller proportion of peop... |
In another way, though, it's the evolution of consumer culture itself. Actual ownership is unnecessary when it's the experience of consumption that people crave. Modern services are completely focused on this—they make the user experience as smooth as possible. When you're paying, everything is there on demand; it's al... |
The only real barrier to not paying for digital content, for example, is that it's annoying and time-consuming. Most people don't care one bit about the ethics of it or the legality, because the laws are generally so rarely enforced. It's only the convenience that holds people back and pushes them towards the legal pai... |
To beat this, you have to rise above it. And while you can't change the wider economic realities or the appetites of the average consumer, you can change your own priorities. Because if enough people actually value true ownership, there will always be an economic niche in serving them. |
Every generation faces new challenges, and for Generation Z, one of theirs is to resist this tempting but exploitative world they've grown up in. |
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