Tomorrow’s generation of consumers will completely upend the fresh produce business as we know it. Here’s why produce managers and marketers need to be prepared today.
Just when we had the Millennials figured out, the generation to follow them is already poised to bring even bigger changes to the produce business. And a multi-billion-dollar market segment depends on understanding what makes them tick.
Considerable market research has been devoted to Millennials – those 20- and 30-somethings who make up a giant segment (almost a third) of all U.S. shoppers. Obviously they represent a lot of buying power, and we’ve seen how their likes and dislikes have already caused a significant shift in what gets grown and sold worldwide. They’ve not only influenced our food choices, they’re literally responsible for changing the way we eat. But when it comes to the cohort of consumers coming next – those 23 years old and under, who make up Generation Z -- we are just starting to understand how they’re different, and why these differences matter. The kicker is, the more we know about these consumers, the less predictable the market appears to be. But important new clues are emerging from the latest research, which can help us meet their needs. Remember, Generation Z makes up a full 1/4th of the population – this crowd will only continue to grow, and they’re going to be hungry.
What already know some of the characteristics of Generation Z. We know they’re technology savvy, socially-engaged and health-conscious. We know they also have short attention spans -- but they’re spending more of their money on food than any generation before them. Generation Z has contributed to a 20% growth in fresh food sales over the last several years, and some of the latest findings help explain why:
Generation Z is ethnically diverse; nearly 50% identify as non-Caucasian. Diversity contributes to the existing trend among younger consumers who enjoy exploring global, ethnic cuisines; Generation Z seeks out authentic, innovative food experiences. For produce managers, this means a wider array of tastes and origins should be part of the produce mix, with spices and add-ons displayed nearby.
Generation Z is a fully ‘digital’ cohort that expects transparency in ingredients, which dovetails with their concern for resources, where their food comes from, and a desire for ‘real,’ sustainable, high-quality, healthy products. This is reflected in their wide adoption of organic produce, and the increasing amount of budget they dedicate to fresh produce. But they are not brand loyalists – they’ll readily switch to something they think is healthier or cheaper. Produce managers should keep these preferences in mind when choosing which products to sell, and how they’re presented. A wide selection of organic and standard lines, plus a variety of packing and portion options, will ensure these consumers will find something they’ll actually buy.
And even though this is a digital generation (and perhaps because of it), Gen Z is not as interested in convenience as they are in ‘real’ experiences. They do not shop online as much as Millennials do – they want to touch, smell and taste foods before they buy. This translates to buying fewer convenience-products, too. Pre-packaged meals and snacks won’t appeal to them as much; they’re more likely to prepare meals at home. This means how products are positioned in-store is all-important. Snacks in the form of fruit clamshells, salad kits that they can modify at home, and plenty of cut samples for them to try – these should all be a bigger part of a store’s offerings. Fruit will be the number one area of growth when it comes to ready-to-eat-snacks, so produce managers must have a strategy in place to meet that growing market.
Besides knowing the likes and dislikes of Generation Z, it’s important to realize how they’re changing food culture overall. In a nutshell, tradition has gone out the window – the food economy is being driven by changes in consumption and rapidly evolving social forces. Planning, shopping and cooking are no longer dictated by moms, but are decentralized and fragmented. The next generation will never be completely predictable, but they will be leading the way regardless.
Generation Z: They may be young, but they’ll be shaping the fresh produce market landscape for years to come.
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