By 2025, the generation known as "Millennials" will make up three-quarters of the world’s workforce. Here are a few important things about their grocery shopping habits that every FMCG/CPG brand should take note of...
You can rant about participation trophies, entitlement, and avocado toast until your face turns blue, but millennials won’t be going away. In fact, by 2025 they’ll make up three-quarters of the world’s workforce. And they’ll continue to do things their way, regardless of how their elders feel about it. Here are 4 things every CPG brand needs to know about their grocery shopping habits to make the most of this lucrative market sector moving forward..
A fascinating report from the USDA on millennials’ food purchase decisions concluded that “millennial preference for convenience may be a principal characteristic of the generation.” This desire for convenience showed up in purchasing habits, as millennials were more likely than others to purchase prepared deli food, carryout, delivery, or fast food meals than their elders. 62% of those surveyed reported making such a purchase in the past week. Millennials also reported that they spent less time on food preparation and cleanup, spending 55 fewer minutes per week cooking and washing up than Gen Xers.
The researchers also noted that “Millennials allocate the highest budget shares to prepared foods, sugar and sweets, and pasta but the least to grains. The first three categories all require minimal preparation for consumption.” This generation simply has less time available to spend cooking, and prizes meals that can be consumed with minimal effort.
As NewHopeNetwork reports, “the clear over-arching trend with millennials is that spending on groceries is down, and that spending on food outside the home is up.” Similarly, the International Food Information Council’s 2017 report found that 55% of millennials said convenience was the top driver when purchasing food. This trend means that millennials might currently be less likely to purchase food online, as it is more convenient to grab prepared or fast food on the go. However, as the convenience gap closes and delivery times shrink, millennials will probably shift towards ordering meals from their smartphones and receiving them wherever they happen to be.
According to the Washington Post, millennials have new ideas about what’s healthy. While previous generations would’ve cited “low-fat” or “high-fiber” as key elements in a nutritious meal, millennials look for food that’s natural, organic, locally sourced and sustainable.
The Keto Diet is also changing beliefs about health. The meal planning system is very popular with this generation, and its philosophies have made millennials prize the health benefits of saturated fat in trendy coconut and fish oils, as well as cream and butter. Millennials are also much more likely to say animal protein is healthy, with 47% of them saying meat is good for the body, while just 26% of older cohorts agreed.
One disturbing trend in the literature on this topic is where millennials are getting their information on health and nutrition. According to the IFIC, 40% of millennials report that a friend or family member is their main source of information on nutrition, while older people are much more reliant on doctors and nutritionists. Millennials also get a lot of their information from bloggers and social media fitness personalities. Experts worry that fads and trends which perpetuate misleading and harmful ideas will be difficult to counter.
Sustainability is something of a magic word for millennials, and it deeply affects their purchasing habits and perception of products and companies. While they are more likely to think that meat is healthy, according to the USDA they buy less of it (and more nuts and other plant-based proteins) than older generations. Millennials are also more likely to buy organic and locally sourced food than their elders. This preference extends from individual products to brands, as Ecosphere reports that “87% [of millennials] would be more loyal to a company that helps them contribute to social and environmental issues.”
As a result of millennials’ purchasing choices, more and more companies are adopting sustainability strategies. A survey from the Economist Intelligence Unit found that 74% of US-based executives felt that good corporate citizenship would help increase profits at their companies. The practice of sustainability reporting has grown by 30% over the past four years according to Ecosphere, while 9000 corporations have currently signed the UN Global Compact, which commits them to environmental protection.
One way to signal a commitment to sustainability is to limit waste and the use of plastic in packaging. Studies have shown that 65% of millennials are opposed to the use of plastics in packaging. While the elimination of all plastics in packaging isn’t realistic at the moment, companies like How2Recycle that add consistent and transparent recycling information to packaging can take the stigma away from plastic use. Leading FMCG brands such as Nestle, Amy’s, and Nature’s Path Organics are already using the service.
As noted above, convenience is a key driver in millennial grocery shopping habits. A 2018 study on shopping trends by the Food Marketing Institute found that 43% of millennials occasionally or often bought groceries online. The figure for millennials with children jumped to 58%. As one mom put it “I expect to lean more heavily on my digital shopping skills in the future. For me, time is everything and it feels like I don’t have enough of it. I look forward to the day I purchase more perishable items online.” Even people who aren’t buying most of their groceries online are anticipating doing so, and their desire to save time makes them very optimistic about the potential of online shopping.
With so many consumers putting a premium on convenience and time-saving, voice shopping seems poised to explode. According to research from OC&C Strategy Consultants, groceries are the most commonly purchased category in voice shopping, and 20% of voice shoppers are buying them. Since digital-native millennials are already the most enthusiastic users of digital assistants, it’s safe to assume that as voice shopping becomes frictionless, more and more members of the generation will gravitate towards an even faster and easier way to buy groceries.
Now you know what millennials desire. Prepared, sustainable, healthy and organic food wrapped in an environmentally friendly package instantly delivered to them wherever they are via voice command. If you can find a way to give them what they want, the future is yours!