SM Investments Corporation’s (SM Investments) retail arm, SM Retail, Inc., is reaching new consumer markets, particularly the rapidly growing Gen Z demographic. Data from the SM Store, the department store business of SM Retail, reveals a 13% increase in in-store purchases by young shoppers in 2024, signaling a shift in consumer behavior and a rising preference for physical retail experiences.
Jonathan Ng, Executive Vice President at SM Retail, shared, “Our strategy has always been ‘We’ve got it all for you.’ SM Store offers a broad product range that appeals to different market segments, making it a one-stop shop for all. We’re also placing greater emphasis on engaging with Gen Z.”
This increase in Gen Z shoppers reflects the growing purchasing power of this demographic. Mr. Ng added, “While Gen X and Millennials still lead in terms of purchasing power, we’re strategically investing in Gen Z as they become an increasingly influential consumer group.”
Gen X, ages 45 to 60, are those born between 1965 and 1980, and Millennials, ages 29 to 44, are born between 1981 and 1996. Gen Z, ages 13 to 28 or born between 1997 and 2012, currently makes up 38% of the Philippine population according to the recent census by the Philippine Statistics Authority.
With 41 million Gen Zs, SM Retail is well-positioned to capitalize on this segment. A 2024 study by The Fourth Wall and Uniquecorn Strategies revealed that 31% of Filipino Gen Zs prefer shopping in physical stores, valuing the experience of products they can see and touch.
This trend mirrors a broader global shift. A January 2025 report by Adyen, published by Retail Dive, found that nearly three-quarters of global Gen Z consumers shop in-person at least once a week, viewing it as an integral part of their lifestyle.
“Filipino shoppers, especially Gen Z, are more experiential and tactile in their shopping preferences,” Mr. Ng explained. “At SM Store, we are dedicated to evolving to meet these expectations, investing in modern store designs and enhancing customer service to stay ahead of the curve.”
SM Retail has also focused on enhancing the customer experience through strategic partnerships, such as its collaboration with Coffee Bean and Tea Leaf (CBTL), designed to create a more enjoyable in-store environment. This focus on in-store discounts, convenience, and the ability to quickly own products aligns well with Gen Z’s preferences.
“SM is all about excellent customer service,” Mr. Ng emphasized, noting the presence of personal shoppers who are always ready to assist customers.
SM Store continues to innovate, evolving its merchandise selection, store layouts, and overall customer experience to meet the demands of an ever-changing retail landscape. This commitment to excellence is reflected in SM Retail’s solid financial performance. In 2024, the company posted a net income of PHP 20.9 billion, a 5% increase from the previous year, with retail revenues growing 5% to PHP 434.5 billion, up from PHP 412.9 billion in 2023.
SM Retail’s ongoing growth and its ability to engage with different consumer segments reinforce its leadership position within the Philippine retail sector, contributing significantly to the strong financial performance of the group’s parent company, SM Investments.
