According to a Bloomberg Markets report published just over a year ago, Americans spent more money on restaurants and bars than on grocery stores for the first time ever. The report goes on to suggest that generational shifts are to blame.
Understand what’s behind the trend.
“Millennials are more willing than previous generations to spend money on dining out; and they appreciate the social aspect of sharing a meal together,” writes Gerry Hays in a recent Business.com story.
One could argue that this trend has been slowly climbing with every generation as industrialization took hold. Some credit the birth of the fast food industry to the opening of the first automat in 1912 and their popular slogan “Less work for Mother.” As more and more women entered the workforce, time to prepare meals plummeted as disposable income rose.
Millennials, representing the largest consumer purchasing power in history, have simply amplified what’s been going on for a hundred years. But don’t let that paint a bleak picture.
Rethink what consumers are really saying with their dollars.
It’s not enough anymore to simply talk about time pressures and increased spending money.
- Millennials are the most multi-ethnic and culturally curious generation to date. They have a far broader palate and are more willing to try new things than their parents.
- They are also very sociable; however, don’t assume that means dining out all the time. According to research conducted by the Research Institute for Cooking and Kitchen Intelligence (RICKI), Millennials cook at home with friends much more often than other generations — 63 percent report “always” or “frequently,” as opposed to only 25 percent of the same frequency reported by Baby Boomers.
These are exactly the consumer profiles and habits that grocery stores can accommodate.
- Offer and promote a range of world cuisine not only in the produce section, but also in the wine, deli, spice, and frozen sections as well.
- Redefine the deli experience by offering additional specialty stations such as cheese shops, sushi bars, and freshly prepared ready-to-eat meals. In fact, there has been “explosive” growth in fresh prepared foods, which is expected to continue, according to Supermarket News.
- Broaden the cachet of your frozen food selection. Brands like Devour, Evol, Amy’s, and Saffron Road are revolutionizing the so-called TV dinner.
- Exploit shelf-edge tags and signage to cross-promote menu and recipe items that appeal to this youthful, cross-cultural demographic throughout your entire store.
In the end, it all boils down to relevance. It’s the age-old wisdom of knowing who your customers are, what they want, and how to provide it.