Talkin’ ‘bout our (next) generation.

I’ve been to a number of conferences over the past year and inevitably, the agenda includes at least one breakout about “Millennials”. There’s always an audible groan as attendees agree that they have “heard enough about this generation of experience-seeking, non-committal, entitled kids!”. (I should mention here that I am considered a Millennial myself…) Anyway, it’s time for Gen-Z.

A Gen-Z panel at this year’s IFMA COEX opened up about their preferences and their opinions on what steers their decisions when it comes to food. And they have a lot of them. From what I observed, this panel was articulate about the macro social issues that influence the way they think about what—and how—they eat. Simultaneously, they were practical about how their current stage of development impacts how that plays out in “real life”.

WHY IT’S HAPPENING

Now the single largest single population segment1, Gen-Z makes up 26% of the total media audience and with key differences in values and preferences, they pose an interesting challenge for brands. Encompassing those born between 1997 and 2015, this generation has serious spending power: Some through personal wealth and others through “pester power”.

As this generation approaches adulthood, early studies are homing in on what shapes their values and how that is being played out with purchases – whether of products or experiences. A few key things to consider when it comes to the food industry in particular:

Digital from DOB. This is the first generation that has truly grown up with cell phones—their parents are connected, and they access them at a much younger age. The panelists all voiced their use of their smartphone as a way to discover (Instagram), vet (Yelp), obtain (online ordering) and ultimately capture their unique experience. It’s worth noting that their time is spent on mobile devices rather than a PC—in fact, this generation spends an average of 8 minutes a day online via PC as compared to the 1+ hour of older generations1.

Socializing. What may seem in contrast to the above point, Gen-Z values “hanging out and socializing” as a top priority along with ordering shareable items when it comes to their preferred dining experience2. You may have heard rumblings of this generation noting higher levels of loneliness, with less human-to-human, authentic interactions. So it’s not surprising that Gen-Z seeks interaction with family and friends when it comes to dining. Keep this in mind as your brand thinks about how to facilitate relationship-building experiences and environments for Gen-Z.

WHAT WE THINK

This generation is different—brands and experiences in the food space are going to have to understand their expectations in a more holistic way.

We know that Gen-Z is outpacing Millennials in their occasions per week at top chains in the US3, and it’s up to us to keep a two-way conversation going with this group to truly understand them. As a more independent and entrepreneurial generation, it’s going to be more critical than ever to understand both what the data says about what matters to them and what resonates with them as individuals. Face-value of where, when and how they are dining are likely to line up with values that occasionally surprise us based on past generations.

WHAT’S NEXT

The largest qualitative and quantitative study to date was completed by KANTAR in 2017 and explored this generation’s attitudes and behaviors4. When it comes to media recommendations, “innovative formats” are cited as a way to win with this generation. In terms of creative recommendations, “expect a challenge”, “be interactive” and “push the aesthetic” are the headliners—which captures the pace and outside-the-box thinking that is going to be required to really understand and resonate with Gen-Z.

Full of nuances like the simple examples above, Gen-Z is discerning and likely going to be a challenge as marketers attempt to understand this ever-changing consumer.

[1] “Move over millennials, Gen-Z now the largest single population segment.” Sterling, Greg. Marketing Land. 17 June 2017.
[2] “The Gen-Z Selfie.” Technomic, courtesy of SmartSupport. June 2016.
[3] “Shifting Market Dynamics.” 2018 COEX, courtesy of Foodable Labs.
[4] “How to market effectively to Centennials.” Inskip, Mark. WARC Best Practices. July 2016.

What’s your function?

Have you had pH balanced water recently? Or added a teaspoon of collagen to your coffee? Maybe enjoyed a beverage with probiotics like kombucha? While not everyone has jumped on this trend, the functional food market is growing rapidly, with revenue projected to reach over 440 billion dollars by 20221.

Referring to food and drinks that serve a greater health benefit, functional products are making their way to a broader range of formats. Brands look to sync added value with convenience and impact to win consumers over, as many of these products aim to be part of a daily routine.

WHY IT’S HAPPENING

The growing awareness of the direct links between diet and type 2 diabetes, coronary heart disease and cancer are clear drivers of the growing interest in functional foods. With the increasing presence of lifestyle diets that align with the same qualities, the focus on consumers’ health and well-being is creating a demand for food that does more than just satisfy hunger—essentially, consumers want more bang for their calorie.

Functional beverages were the first in this arena, from sports and energy drinks to a wide range of probiotic mixes. In fact, as many as 24% of juice and juice drink products now feature a functional claim1.

This has paved the way for functional ingredients that show up in a variety of formats to take center stage at shows like Expo West and retailers like Whole Foods. Primal Kitchen is a brand that offers a wide range of products that are Paleo, Primal, Keto-friendly, Whole-30 approved and “uncompromisingly delicious and nutrient dense”. They feature a wide range of formats of collagen—with benefit claims for bone health, joints, and skin.

WHAT WE THINK

Consumers are looking for ways to “strive” rather than “survive”—and while it might be difficult to anticipate which functional products stick, the mindset will continue to grow.

We understand that consumers are becoming savvier and that some of these products have much stronger benefit claims than others. It is likely that many of the products we see today may be short-lived as consumers decipher which have the greatest impact (and which fit within their lifestyle). But the mindset is indicative of where the food industry is heading. Value matters.

WHAT’S NEXT

Functional food and beverages are making a more direct and intentional connection between what consumers put in their body and the benefits they expect when it comes to their health and well-being. As studies begin to shed light on the mind-body connection, the proliferation of functional foods will gain momentum. While the range of available products broadens, consumers are going to have to decipher what to prioritize—if they don’t reach decision fatigue first.

Brands are going to be faced with the challenge of making their functional products easy to understand—with real, reliable links to health benefits. Perhaps the biggest battle they will face is breaking through the benefit clutter.

Just some Thought for Food™

[1] “U.S. Functional Foods Market – Statistics & Facts.” The Statistics Portal. https://www.statista.com/topics/1321/functional-foods-market/

Questions, comments or want to learn more? Let's connect! weshouldtalk@jtmega.com

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Talkin' 'bout our (next) generation
Talkin’ ‘bout our (next) generation.

I’ve been to a number of conferences over the past year and inevitably, the agenda includes at least one breakout about “Millennials”. There’s always an audible groan as attendees agree that they have “heard enough about this generation of experience-seeking, non-committal, entitled kids!”. (I should mention here that I am considered a Millennial myself…) Anyway, […]

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What's your function?
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Have you had pH balanced water recently? Or added a teaspoon of collagen to your coffee? Maybe enjoyed a beverage with probiotics like kombucha? While not everyone has jumped on this trend, the functional food market is growing rapidly, with revenue projected to reach over 440 billion dollars by 20221. Referring to food and drinks […]

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