By the early 2030s, the population of millennials in the United States is expected to peak at 75 million. At the same time, the income of Generation Z will have surpassed that of millennials. With that date rapidly approaching, now is the time for food retailers to begin preparing for those significant demographic changes, as well as for the shifting purchasing habits that accompany both age groups.
According to new research from Kroger’s 84.51˚ retail data science, insights and media arm, that involves not only understanding upcoming demographic changes in the US population but also how Gen Z and millennial shoppers approach food, grocery shopping and the grocery shopping experience.
The shifting role of food for younger generations
“One thing we are seeing is the increasing roles that food plays in people’s lives,” said Maria Arand, director of customer strategy for 84.51˚. “If you go back several generations, you’ll see that customers are used to thinking of food as sustenance and for nutrition but what we’re seeing with millennials and Gen Z, as well, is this increasing reliance on food. Food is increasingly viewed as meeting not just that basic sustenance need but truly as medicine in solving health concerns – even beyond issues like diabetes or heart disease that we usually associate with food with to issues such as mental illness.”
In addition to the health aspect, millennials and Gen Zers view food as having a deep connection with their community and relating to everything from environmental issues to social justice while also connecting it to family and events, Arand said.
“Food is servicing all of these roles,” Arand said. “It looks a little different for everyone but we’re seeing that consistently increase.”
Shoppers are carrying a heavier mental load
As a result, millennials and Gen Z shoppers are noting that food carries with it a certain mental burden aspect, 84.51˚ research found.
“Not only are our lives getting busier, the role of food is getting more and more important, putting more and more stress on the moment of shopping and consuming food,” Arand explained. “The stress that we’re seeing is directly related to the different demands of food. Family dynamics are more complicated. There’s no longer that average, nuclear family of two parents, two kids, one’s at home, one’s working. It’s much more complicated. Millennials are taking care of not just children, but their parents, too. And all of that creates a lot of pressure on food, which can add to the mental load of grocery shopping.”
That mental load is something food retailers will have to be sensitive to as millennials and Gen Z shoppers grow into the dominant market force over the next several years, Arand said.
“What we’re hearing from shoppers is this kind of ask or plea to ‘Make my life easier. Make shopping easier. Make cooking easier,’” Arand said. “So when we think about retailers and brands, there’s a huge opportunity to make lives easier across all of the moments of that shopping journey.”
When retailers hear that, they frequently immediately go to product-based solutions such as assortment of offerings, convenient meals and simple options, Arand said.
“That can be a piece but remember consumers are planning and that is a huge burden. In a lot of our research, the planning is really the biggest unsolved burden for shoppers because when they describe it they say, ‘We sit down on Sunday and plan meals for the week and when we get to the third meal or the fourth meal, we’re just out of ideas and we just give up.’ And when they get to the end of the week it’s even more stressful. Thursday night rolls around and you don’t have a meal in your fridge and you don’t have anything to prepare. I think that’s a huge, overlooked opportunity. Retailers are innovating in that space but that’s the largest unmet need that we hear.”
Millennial and Gen Z shopping trends
Yet, it can be difficult to pinpoint a single solution to meet these shoppers’ needs, as 84.51˚ data shows that even among millennials and Gen Zers there are divergences in shopping methods and preferences. For instance, like their Generation X and Baby Boomer counterparts, millennials shop in store more often than they buy online for pickup or delivery, whereas Gen Z shoppers are more likely to place online grocery orders for pickup.
Then there are the most frequently purchased items for each group. Millennials most frequently purchase bagged snacks, baked breads and fluid milk products, whereas Gen Z is more likely to buy crackers and miscellaneous baked goods, refrigerated Asian foods and processed cheese, 84.51˚ found.
Of equally interesting note are the items each generation isn’t buying. Millennials are least likely to purchase dry sauce and gravy mixes made with natural ingredients, South American foods and frozen juices made with natural ingredients. Gen Z, on the other hand, is least likely to buy natural/organic/cage-free eggs, crabmeat and beef sausage and ground beef products.
A one-size-fits-all approach won’t cut it
As a result of the myriad of these consumers’ needs, food retailers are responding with a variety of solutions. According to the 2024 Report on Food Industry Contributions to Health & Well-being from FMI – The Food Industry Association, 82% of food retailers and suppliers employ dietitians throughout their companies and nearly 20% have in-store registered dietitians to assist shoppers in making purchases that align with their dietary and overall health needs. In addition, grocers are increasing their foodservice options, according to FMI’s Power of Foodservice at Retail 2023 report, as one in every four shoppers is replacing restaurant meals with foodservice options found at their local grocery stores.
“We hear from customers that they like that simplification, but they also like the control,” Arand said. “For some customers, convenience means, ‘I still want to cook at home, so just pre-slice it for me, or pre-season it for me.’ For others, they just need to be able to come home from work and throw something in the oven from the freezer and then for others, they don’t even have time to do that. They need something that’s prepped and ready-to-eat. And I think we’ve seen innovation in all of those spaces, and we’ve seen consumers reacting well to a lot of that innovation. It just feels like we, as an industry, have a lot of opportunities still to address the needs of customers.”
Recent related stories:
- Want your children to do better in school? Eat dinner with them
- Q&A: A day in the life of an award-winning grocery store manager
- The Fresh Market leader shares lessons learned from stock boy to store manager
_____________________________________
If you liked this article, sign up to receive one of SmartBrief’s Food & Beverage newsletters. They are among SmartBrief’s more than 250 industry-focused newsletters.