Stay up-to-date on the latest food retail news and trends
Subscribe to free eNewsletters from Supermarket News
Sponsored By
Store Brands 2014: Managing Millennials
Generation Y shops traditional supermarkets often, wants value and is receptive to store brands, according to a new PLMA survey
Carol Angrisani
January 27, 2014
5 Min Read
Millennials are overwhelmingly aware of, and regularly buy, store brands, according to a new Surveylab survey conducted for the PLMA for publication in Supermarket News.
Nearly all (96%) Millennials are aware of store brand products; 36% buy them “frequently” and 53% buy them “occasionally,” according to “My Generation and Grocery Shopping,” a just-released online survey.
STORE BRANDS 2014
An SN Special Report
The survey polled more than 1,500 Millennials (52% women, 48% men) nationwide. More than three-quarters identified as the primary grocery shopper in their household, while the balance said they share that task with another adult in the household.
Millennials — the children of the post-World War II Baby Boomer generation — are the population segment born between about 1980 and 2000. At 80 million strong, they are expected to become the country’s most powerful consumer group by 2016.
They are thrifty and looking for value when they shop for groceries, likely a result of growing up at the height of the economic downturn and uncertain job market.
Only 44% of survey respondents reported they have a full-time job, while 21% have a part-time job and 11% are looking for work. Twenty percent are full-time students.
While their employment status is not surprising considering their young age — which ranges from teens to early 30s — it nevertheless sends a message about how they spend their money, said Brian Sharoff, president of the Private Label Manufacturers Association.
“Their down-to-earth attitude toward what they can buy is important to understanding what retailers can sell them,” Sharoff said.
Millennials like store brands
Perhaps a result of their finances, Millennials like store brands. Seventy-one percent said “value for the money” is the main reason why they purchase store brands as opposed to the national brand. Moreover, 77% of those who report they buy store brands “frequently” cite “value for the money” as a reason they opt for these products over national brands. Other reasons given include “sales and coupons” (43%), quality (28%) and “trust and confidence in the retailer” (24%).
Respondents were asked to directly compare store brands with national brands on a variety of product attributes. A strong majority agreed that store brands are as good as, if not better than, national brands. The majority also said store brands perform as well and taste as good as national brands.
More than half agreed that store brand packaging is as good as or better than national brands. Nearly half said the same about store brand promotional activities.
Nearly 60% agreed that they would like stores to carry an even larger selection of store brands.
Millennials shop often for groceries: more than three-fourths go to a food store at least once a week. Men are more inclined than women to shop several times a week: 26% vs. 22%.
Millennials prefer supermarkets
Traditional supermarkets are their channel of choice.
Eight in 10 said supermarkets are the store type they choose for their regular grocery shopping.
“Retailers, therefore, need to reexamine their usual emphasis on the housewife or working mother, and give some additional attention to niche marketing to those born between 1980 and 2000,” said Sharoff.
Mass merchandisers such as Walmart and Target were next at 66% (respondents could select more than one answer).
Follow @SN_News for updates throughout the day.
Despite their focus on value, Millennials shop less frequently at dollar stores (21%) and discount chains like Aldi (14%). Also lower on the list are neighborhood grocery stores (14%), farmers’ markets (13%)and convenience stores (8%).
Affordability, value and pricing are the most important reasons why Millennials choose a particular store in which to do their regular grocery shopping. When given 14 choices (they could select more than one), 56% said when doing their regular grocery shopping it is “very important” that the store has “products that are affordable.” Close behind as “very important” factors were “products that offer the best value” (47%), “lowest prices every day” (46%) and “frequent sales and discounts” (44%).
Among other “very important” factors: “The store is a convenient place to shop” (44%), it has the “best selection of products” (43%), it has a “good selection of store brand products” (31%), the store is a “desirable place to shop” (30%) and the “store is well-known to me” (27%).
While Millennials are satisfied with store brands, they welcome improvements. More than half (53%) said improved quality would motivate them to buy even more store brands this year. About 45% said they would make more store brand purchases this year based on “my overall satisfaction with store brands in the past.”
Millennials would also purchase more store brands if there was more variety (38%), new and innovative store brand products (31%), a greater variety of store brand package sizes (30%), more store brand organic products (26%) and more trial packs of store brands (25%).
While they are the nation’s most technologically connected demographic group, they do not significantly patronize online portals for grocery shopping.
More than half have bought health and beauty products online. But only 25% have purchased groceries online.
While Millennials plan to make more online purchases in the future, groceries will not be the main reason why. When asked to forecast their online buying over the next five years, Millennials said they expect to increase their purchase of clothing and shoes (37%), books, DVDs and music (33%), health and beauty products (24%) and travel services (24%). Just 19% said they expect to buy more of their regular household groceries online.
About the Author
You May Also Like
