We still may be in the baby boom economy, but next year begins the transition to Gen X dominance, and companies would be wise to prioritize the needs and products that are important to those born between 1965 and 1980, NielsenIQ’s X Factor report advises.
Gen X, which numbers some 65 million Americans and 1.4 billion globally, represents about 17% of the population but about 25% of consumer spending.
“Currently, in the U.S., Gen X households (in total) spend less across almost all CPG categories than boomer or millennial households because there are comparatively fewer of them. However, they are big spenders when you look at dollars spent on a per-household basis,” NielsenIQ found.
“At the category level, Gen X households in the U.S. spend more than boomer households on all categories, except floral, and more than millennial households on pet care, floral, and household care.”
“What’s especially interesting is how Gen X approaches brands. They’re not chasing trends or swayed by social buzz the way younger consumers might be,” said Marta Cyhan-Bowles, NIQ’s chief communications officer and head of global marketing.
“[Gen X is] looking for brands that consistently deliver – ones that save them time, money, or mental energy.”
If a brand they’ve trusted stops meeting expectations or no longer offers clear value, Gen Xers aren’t afraid to make a switch. Loyalty, for them, is earned through performance, not promises, NIQ noted.
Gen X is expected to spend $15.2 trillion this year and $23 trillion by 2035, meaning companies have just a few years to capture Gen Xers’ loyalty.
“They’re in their prime earning years, and it shows – they’re leading the way in daily discretionary spending and are among the most reliable contributors to growth across high-value consumer segments,” Cyhan-Bowles said.
But as the sandwich generation, juggling responsibilities for elderly parents, work and their families, Gen Xers face mounting pressures. Cyhan-Bowles said those pressures add complexity to their spending decisions.
The report said Gen X’s spending habits reveal there’s room for premium yet practical products and innovations, and that retailers should focus on home care management and target Gen X’s need for “maintaining homes, supporting familial well-being, and safeguarding their valuable time.”
While other generations tend to embrace private-label products, Gen X leans toward branded products.
“For F&B manufacturers, this means developing products with formats and claims that speak to caregiving, longevity and convenience. For retailers, it’s about curating assortments and in-store experiences that reflect these needs, making it easier for Gen X shoppers to find solutions that support their multi-generational households and simplify their routines.”
The X Factor report noted Gen X represents the greatest return on investment in large-basket, multi-category spending across the grocery, household and wellness categories – the most profitable consumer segments.
Gen Xers typically look for functionality, value, health, convenience, and authenticity, the report said.
In lower-income areas and countries, Gen X prizes “affordability and accessibility, durability and multi-use utility, availability (wide-scale distribution), and functional wellness at affordable prices.”
Gen X will forever be haunted by the Great Recession, which took their homes and jobs, and cut into savings and retirement plans. A survey by the Mather Institute indicated that more than half of Gen Xers are frequently stressed by finances.
Only 35% said they thought they’d be able to support parents, and just 55% felt confident about supporting their children.
“Economic uncertainty has left a lasting mark, and Gen X is feeling it. With so many financial obligations, they’re prioritizing essentials and making more deliberate choices. For brands across the industry, that means showing up with real value and relevance – because Gen X isn’t just spending, they’re spending smart,” Cyhan-Bowles said.
Food for Thought Leadership
This Episode is Sponsored by: Performance Foodservice
How important is it as a food distributor to build a brand for foodservice – especially since consumers may never see or recognize it? Mike Seidel, vice president of procurement at Performance Foodservice Corporate, shares how the company views the development of its existing foodservice brands, including Roma and Contigo, and how they helped in the creation of its most recent Mediterranean concept Zebec.
