Millennial shoppers challenge grocery stores to accommodate complex needs
Ready Pac assesses factors leading millennial shoppers away from traditional grocery and into alternative channels
The insatiable curiosity surrounding the Millennial generation (current age 18-35) is certainly not a new topic – but the importance of this complex demographic is growing, especially for grocery retailers. An apparent trend has surfaced, leading fickle (but abundant) Millennial dollars away from traditional grocery stores and into the hands of farmer’s markets, online and specialty retailers. A combination of factors, including health, status, convenience, freshness and ethics – all play an important role in these consumers’ purchase decisions.
This year, it was reported that Millennials buy only 41% of their food at traditional grocery stores – compared to Boomers’ 50% (Mintel). This gap is forecasted to widen as we look into the coming years. By 2016, Millennials will have the highest discretionary income in the US, and by 2020, there will be 64.1 million Millennials over the age of 25, an increase from just 17.1 million in 2010. For leading produce companies like Ready Pac Foods, Inc. there is a clear opportunity to win over this key demographic by engaging them directly through one of their core motivators: maintaining a healthy lifestyle – and making it seem effortless.
“Having grown up in an instant gratification society, these shoppers want what they want, when they want it” says Tristan Simpson, director of marketing and corporate communications at Ready Pac. In turn, data suggests Millennials have developed very little loyalty to retailers and brands which fail to recognize their desired attributes. Even though their spending power is limited overall, luxury items peak their interest, causing them to make up for their tendency to spend by cutting spending on items they perceive as less essential. Correctly identifying this cohort’s definition of luxury and essential is crucial in maintaining their loyalty. Within the food industry, it means providing healthy, ethical and value-added products in the most attainable way possible.
“We’ve been watching Millennial trends for quite some time,” says Simpson, “and our Ready Pac Bistro® and Bistro® Organic Bowls, in particular, strike a chord with these consumers because they check off so many things on their ‘must have’ list. The Bistro line is healthy, affordable, convenient, environmentally responsible and on-trend with the restaurant industry’s top-selling salad flavors.” Mintel’s Fresh Fruit and Vegetables 2012 report validates this brand-cohort connection, stating that Millennials are the most likely group to purchase organic and value-added produce, wherein packaged salad mixes ranked number one in purchase frequency.
In terms of organic growth and sustainability, Ready Pac’s brand profile has become even more Millennial-approved within the last year. Four new recipes within the Bistro® Organic line were introduced this year, includingOrganic Cranberry Walnut, Organic Chicken Caesar, Organic Southwestern Style, and Organic Honey Mustard Baby Spinach. At the same time, Ready Pac significantly reduced the amount of materials used in their Bistro® Bowls and clamshell salad containers; the latter of which earned them a finalist nomination for Best New Packaging at this year’s United Fresh 2013.