US: How 'Millennials' are changing food 'as we know it'
Move over Boomers, the Millennials (aka Generation Y) are taking over. And that shift will potentially change the food system as we know it, says a new research report out of the US.
The report recently released by Jeffries Alix Partners, “Trouble in Aisle 5”, looks at the impact the generation born between 1982 and 2001 (otherwise known as the ‘Millennials’) will have on the grocery market as they continue to mature into people with money and families.
At the same time the purchasing power of the Baby Boomer generation is slowly fading, the report says, and the group will have less impact on what is available at the supermarket.
“Indeed, the maturation of the Millennials and the aging of the Baby Boomers, in our opinion, appear poised to rapidly transform the food-at-home industry, long thought of as a bastion of stability. This transformation has the potential to create a chaotic marketplace that markedly changes where and how consumers shop for groceries, as well as what products they bring home.”
Yes, Millennials still prefer cheaper food, and want it to be convenient. But they are also more willing to pay for fresh and healthy food, and are willing to go to great lengths to find it. And they are also more aligned with the “food movement” and love things like organic farms, small batch jams and artisanal cheese.
This shift – by millions of people – could change the market place forever (don’t forget – they will be teaching their children to eat this way too) as power is shifted from large mass market companies and brands to “the little guy” selling online or at the local corner store.
Key points made by the report:
- The Millennials have much less brand loyalty and are more willing to engage in different distribution models to find food. This generation is not afraid to purchase food online and to look outside of the traditional grocery store to find what they want. Boomers on the other hand were more brand loyal and shopped at the grocery store for everything.
- Millennials are less married to the ‘one stop shop’ concept of grocery store shopping.
- Specialty (ethnic, organic / natural, and fresh) sellers – in shops and online – will benefit from changes in preference.
- Branded processed food manufacturers will be “losers” in the new food paradigm.
- Millennials – while focused on paying as little as possible for products – are also much more willing to pay more for specific attributes in food, such as organics / natural, ethnic and specialty foods.