By Tom Poole, senior vice president, emerging payments at Capital One
Shopping has never just been about transactions, especially for Gen Z. Today, younger spenders choose to shop as a form of identity, culture, and expression. As Gen Z now commands $360 billion in spending power, their preferences aren’t just causing a shift — they’re helping to reshape the modern retail experience.
This evolution, however, does come with its fair share of risks.
What’s shaping the Gen Z shopping experience
The shopping experience is becoming increasingly fragmented and fast-paced. For Gen Z, choice is everywhere, from social platforms and emerging retail experiences to direct-to-consumer channels and content creators.
At the same time, a preference for convenience has ushered in one-tap payments. This allows shoppers to do less while buying more. But this expanded ease has also come with hidden risk. It’s now harder for shoppers to track spending, have a good idea of the value they’re getting, and to spot scams.
These issues aren’t solely applicable to Gen Z. We all must adapt to the forces reshaping shopping habits to restore security, control, and confidence in a rapidly changing retail environment. The best solution lies in intelligent tools like customer-backed products that protect the shopper without interrupting their experience.
The rising risks of online shopping
Today, Gen Z are heavily reliant on social media for brand discovery. Nearly 70% of Gen Z consumers are discovering new products on social media platforms. More specifically, 30.4% of them discover new products on Instagram and 23.2% discover on TikTok. While this path to discovery is opening consumers up to new brands, it’s also exposing them to new vulnerabilities.
The advent of generative and agentic AI has increased the potential for fraud and scams. Some studies show that blocked user-generated content alone rose by 22% in Q1 2024 compared to Q1 2023. Furthermore, more than seven in ten consumers reported an uptick in AI-enhanced scams on platforms including creators to resale markets, pop-up platforms, and emerging social channels.
The good news is that online shopping doesn’t have to be high-risk. As the level of risk has increased, so has the sophistication of solutions.
Why virtual solutions matter more than ever
Gen Z shouldn’t have to overhaul their behavior to remain safe. Instead, they should have access to security that adapts to them without interrupting their shopping experience.
That’s where virtual cards and virtual card numbers (VCNs) come in. These tools deliver a trio of benefits that ensure shopping not only becomes more secure but also remains easy and convenient.
Here’s how VCNs can help change the game:
Security: A way to mitigate fraud risk is to avoid using real cards. Capital One’s virtual cards add an extra layer of protection because credit card numbers aren’t shared with merchants.Convenience: Capital One provides customers with multiple ways to access VCNs. Not only are they always available through the Capital One mobile app, but your Google Chrome browser can autofill your VCN when checking out online. Whether your physical card has been stolen or lost or you simply don’t have access to it, customers still maintain the option to shop online whenever they want.Control: Customers can lock and unlock their virtual cards at any time and impose spending limits to help with personal budgeting or take the guesswork out of shopping in a foreign currency. These features make virtual cards a fully customizable payment method that’s independent from a physical credit card.
Shopping with VCNs can ensure that financial confidence and security are not trade-offs for fast and convenient shopping experiences.
A new baseline for financial security
When consumers know exactly where their money is going, they feel more empowered to spend it confidently. Online shoppers, especially Gen Z, want simplicity and security, and Capital One is focused on ensuring that the evolving shopping landscape comes with new protections.
Intelligent tools like VCNs are setting a new standard for safer online shopping, allowing consumers to maintain control and confidence so they can shop anytime, anywhere.
Read more about Capital One’s Virtual Credit Cards.
This post was created by Capital One with Insider Studios.
