Ah, yes. Millennials: everything you thought you knew is wrong, and everything you thought was right is about to change. In some variation or another, this headline gets repeated throughout the year as writers try to explain the attitudes, cultural nuances and, perhaps most importantly, spending habits of the most maligned and ambiguous population to ever live in the U.S.
However, this recent Business Insider piece, "Everything you know about millennial spending is about to change," covers two major issues that will be affecting the demographic cohort. The first is that Millennials are starting to become parents, and that will send shockwaves throughout the retail and restaurant industries. The second covers the Millennial focus on healthy eating.
According to marketing platform Crowdtap, more than 60 million Millennials will become parents within the next decade, representing 80% of the generation. The cohort, once known for renting homes instead of buying and dining out instead of creating their own meals, will likely undergo a paradigm shift when faced with the realities (including financial) of parenthood. The spending earmarked for happy hours and vacations will likely shift towards mortgages and car payments.
And they have a lot to spend: according to Exponential, the generation spends $170 billion a year and could start spending $200 billion annually by 2017. However, traditional fast-food eateries should take note: they won't spend their hard-earned dollars just anywhere. The industry's titans are losing market share to up-and-comers like Panera Bread as these spenders are looking for healthier options. This is only poised to get more intense as the generation has young ones to look after, as well.
Starbucks is considered to be one of the few major players in the industry to keep its image intact with the generation, offering kid-friendly snack options like fruit squeezes and organic food snacks. The other industry veterans aren't taking it lightly: McDonald's, Chick-fil-A and Wendy's are actively searching for ways to improve the health image of their food, often by eliminating preservatives and offering organic products.
Grocery and retail stores are also taking notice. Target, Walmart and Kroger are among the stores looking to find ways to tap into the generation's spending. Walmart and Kroger have expanded their organic food selections recently, and Kroger has also expanded its private-label products to focus on healthy foods with lower prices. And as has been previously reported, Whole Foods Market's 365 by Whole Foods banner is specifically tailored for the generation.
So, is everything changing? If you've been reading and relying upon the media reports for all of your information, then yes, it would appear so. However, the generation is following in the footsteps of its predecessors, just at a slower rate. Like their parents before them, Millennials tend to focus on other things when they become parents themselves. Turns out they aren't so unique and different, after all.
Chris is a business writer and market analyst that focuses on the Markets, Legal and Washington sections of the Food Institute Report. In addition, he assists in compiling data for various Food Institute publications throughout the year. He invites you to contact him via email at firstname.lastname@example.org to talk about anything food-related.
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