The millennial generation is leaving its imprint on the world in many different ways — one of which is how it’s influencing modern food culture. We’re seeing a fundamental shift where convenience and affordability are now taking a backseat to quality.
Millennials are the catalyst for this new movement, and the food industry is collectively taking notice. Genevieve Aronson writes at Nielsen that millennials currently drive nearly half (47 percent) of the total US GDP and influence upward of $1 trillion in total consumer spending.
This translates into massive purchasing power, and millennials are definitely a key group that deli owners and cafe owners will want to cater to. In this post, we will explore the relationship between millennial consumers and quality foods, and look for answers to some pressing questions:
Alicia Adamczyk at Forbes argues that most millennials value quality over convenience. She references a survey from Consumer Reports that shows millennials are far more likely to seek out higher quality foods than their Gen X and Baby Boomer predecessors.
They’ll often go out of their way for a quality meal and are willing to pay more for it. Monica Watrous at Food Business News puts a number on that, too: About 70 percent of millennials are willing to pay extra for quality.
As a result, we’re seeing a trend where fast-casual restaurants are thriving because they offer premium ingredients. Even though these establishments are a little more expensive than traditional fast-food powerhouses, they’re having success because they’re positioned for millennial consumers and their desire for quality. Further, the team at Gordon Food Service explains that freshness is the biggest determining factor in quality, and 41 percent of millennials will pay more for fresh foods.
One of the main reasons why this age group is so dead-set on quality is because they tend to value experience over material things. The enjoyment they get out of an amazing dining experience is well worth the extra money.
In other words, they don’t view food as merely utilitarian. It’s an experience.
For decades, big name global brands have wielded the power. But that’s quickly changing with millennials having the lion’s share of purchasing influence. We’re now seeing small/local brands dominating the premium market.
Ann D’Adamo at Women’s Marketing says millennials love small food brands because roughly half of this generation considers themselves foodies. In turn, there’s an inherent preference for small-batch, high-quality and unique foods.
Small food brands are excelling at creating small-batch, craft products that are of considerably higher quality than what most mainstream brands are offering. This translates into a perception of better quality that really resonates with millennials. As a result, small brands have almost half of the entire premium market.
Being authentic is another big selling point these days. Colby B. Jubenville makes a great argument in The Washington Times in which he says that a brand doesn’t have to be amazing in order to connect with millennials. It just has to be authentic.
But what makes a brand authentic? The Watershed team breaks it down to five key elements:
By this description, it’s clear that millennials like brands that stick to their guns and have a purpose. It’s about more than just making a buck. Millennials are especially interested in brands that support a cause and are upfront about what’s in their product. They don’t want to have to “read the fine print.”
Consumer Reports states that Americans are spending more than $680 billion to dine out every year. Considering that Generation Y accounts for a substantial percentage of that number, deli and cafe owners will want to do everything possible to meet this demographic’s wants.
Therefore, they must address the demand for quality. Although the concept of “quality” can be somewhat nebulous in a vacuum, analyzing current trends shows us exactly what millennials are looking for.
Some specific factors include organic, GMO-free foods that are sourced from sustainable farms. Millennials are big on healthy, nutritious foods, and they don’t mind paying extra for those foods. They also tend to feel a connection with smaller brands who possess authenticity that many of the larger brands lack.
It’s clear that appealing to millennial consumers requires a different approach than might be taken with Baby Boomers or even Gen Xers. Gaining a competitive advantage is largely contingent upon delivering the quality that millennials are looking for and appealing to their core values.