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2013 Power 50: Generation Y, No. 7 in Associations/Government/Public Sphere
Generation Y, also known as Millennials, is ranked No. 7 in Associations/Government/Public Sphere of SN’s 2013 Power 50.
Jenna Telesca
July 15, 2013
3 Min Read
Generation Y is the food retail industry’s white whale. These 18- to 34-year old “Millennial” consumers spend $170 billion each year, according to a comScore report, but their shopping habits are pretty different from previous generations’.
Tamara Barnett, senior director of strategic insights at the Hartman Group, calls this generation “brand agnostic.”
And so Millennials have been a driving force behind the rise of private brands.
“They see private brands as a reasonable option in 90% of food and beverage categories. They’re pushing a lot of manufacturers and retailers alike to deliver quality without necessarily pricing things at an exorbitant rate,” she said.
Barnett pointed to Trader Joe’s as an example of a retailer who delivers the kind of shopping experience Gen Y is looking for. “They do a great job of providing a lot of really compelling offerings, but under their private brand.”
On top of being open to private brands, she noted, this generation is enthusiastic about global cuisines and trying new foods.
Millennials are also changing the way people buy food.
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“They’re also embodying this larger trend towards more frequent, near-term shopping often for more immediate consumption occasions than that traditional stock-up trip,” said Barnett.
Gen Y also shops around, Barnett said, to grocery stores, malls, farmers’ markets and online.
The Hartman Group expects online grocery shopping to grow with these young consumers.
“We really think there’s an opportunity for food manufacturers as well as food retailers to really capture that opportunity,” said Barnett.
Even when not purchasing items online, Gen Y uses websites to learn about products.
In the fourth quarter of last year, 53% of Millennials downloaded recipes from websites, versus 45% of 35- to 54-year-olds and 34% of consumers older than 55, according to an online consumer CPG report by eMarketer.
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Plus, 42% of Gen Y researched CPG products on websites, compared with 31% of Gen X and 17% of Boomers.
Quick-service restaurants are important to Gen Y, Barnett said, so retailers who have increased prepared food offerings and QSR partnerships like Jamba Juice and Starbucks are well positioned to attract these shoppers.
Millennials want more from the companies they buy from, too.
“Not only do consumers, particularly Millennials born between 1982 and 2004, want transparency, they want corporate conscience,” said Carol Christison, president and CEO at the International Dairy-Deli-Bakery Association at its trade show in June.
“They want businesses and companies to do the right thing and to help those less fortunate. This trend is becoming the new corporate currency.”
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