Gen Z customers want more than just a takeaway meal; they want a social space to visit, according to new industry data.
Lightspeed Commerce Inc. has released new research showing that even as AI and digital tools increasingly remove friction from dining, consumers are redefining the role of physical stores, not as places of convenience, but as places of connection.
Rather than serving purely transactional needs, many of which can now be handled online, consumers are gravitating toward retail spaces that function as places to gather, socialise, and spend time, signalling a shift in what brick-and-mortar stores are expected to deliver.
Lightspeed’s survey of 3,000 U.S. and Canadian consumers reveals a generational shift in how people shop. Three-quarters of 18–24-year-olds (75 percent) said that “third spaces”, cafés, lounges, or social areas inside stores, are important when deciding where to shop. That figure drops to 65 percent among 25–34-year-olds and just 33 percent among those over 65, underscoring how younger consumers are reshaping the role of physical retail.
As online shopping, AI recommendations, and one-click checkout become table stakes, Gen Z is redefining the value of in-person retail as a place to belong, not just buy.
The impact goes beyond experience. Two-thirds of all respondents (67 percent) said visiting stores with social or community features helps them feel less isolated, suggesting retail is increasingly filling a gap that might have been left by digital-first experiences optimised for speed rather than connection. That emotional lift translates into loyalty: 58 percent of shoppers said they’re more likely to return, and 57 percent said they’d spend more at stores that offer these spaces. Among Gen Z, the connection is even stronger, 83 percent said social retail environments improve their sense of connection, and 68 percent said they’d spend more as a result.
When it comes to what draws people in, coffee culture leads the way, with 73 percent of shoppers saying they find in-store cafés or lounges appealing, more than any other feature. Live music (69 percent) and pop-up markets (65 percent) also rank high, reinforcing demand for retail spaces that feel cultural and community-driven rather than purely commercial.
“Retailers today are competing on experience as much as product, especially as AI reshapes how people discover and purchase goods online,” said Dax Dasilva, Founder and CEO of Lightspeed.
“As technology makes buying easier everywhere, physical retail has a chance to focus on what technology can’t replicate: community, culture, and connection. Our research shows that spaces designed for people, not just transactions, don’t just drive sales, they help customers feel connected and keep them coming back.”
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