What Moves Millennials?
Value tops list of CPG shopping priorities, says new PLMA study
NEW YORK -- Millennials like to describe themselves as unique in their attitudes and how they conduct their lives. A new study reveals that while that may well be true in terms of their overwhelming use of smart phones, social networks and the Internet, millennials who identify themselves as primary grocery shoppers for their household, when it comes to buying food and nonfood necessities, value is the key to their purchasing behavior.
A new nationwide study from the Private Label Manufacturers Association (PLMA) casts significant light on the grocery shopping patterns of these millennials, the 100 million Americans born between 1980 and 2000.
Millennials represent a multi-trillion dollar marketing opportunity. By 2016, they will become the country's most powerful consumer bloc and, over time, will become the most economically impactful generation in U.S. history, outspending even the baby boomer generation. They already account for $1.3 trillion in overall direct annual spending and it is predicted they will buy $60 billion in consumer packaged goods over the next decade. But little is known of their shopping mindset and grocery retailers have generally ignored them.
According to the PLMA study, millennials shop for groceries often and widely, and supermarkets are the most popular choice. Lead factors in what they choose to buy include previous experience with the product, their shopping list and coupons. Seven in 10 belong to a loyalty program. In choosing a store or product, they seek out affordability, value and lowest price. They are also regular purchasers of store brands, think highly of the products, and give them high marks vs. national brands.
Surveylab, a leading online opinion consultant, conducted the study for the PLMA. It consisted of more than 60 questions aimed at determining what moves millennials. Further highlights from the study include:
- Millennials overwhelmingly see their generation as different from previous ones and are optimistic about their future. But many express resignation about their status. Half say their generation is financially less well off than previous ones and one in five say their life is worse than that of their parents. They expect big changes in the future: Half believe stores will look nothing like they do now, and a third believe many of today's national brands will no longer be around.
- Brand loyalty is not a major pull for millennials. When a national brand they wish to buy is not available at the shelf, four in 10 choose the store brand, one third pick a different national brand and one in eight look elsewhere for the national brand they initially wanted.
- Millennials are universally familiar with store brands and buy them regularly. Almost four in 10 said they buy store brands frequently, the highest rate offered in the study.
- 71% said value is the main reason they purchase the store brand product as opposed to the national brand. Product quality improvements and a good prior experience will drive their future store brand purchase.
"Millennials have revolutionized the way we communicate," said Brian Sharoff, PLMA president. "They have created a world of 'likes' and 'friends' larger than all television audiences combined. But who are they? For those who run supermarkets, drug chains and mass merchandisers, they are still enigmatic. Hopefully, this study will help clarify how they shop and what they want."
Approximately 1,600 men and women from 18 to 33 years old who identified themselves as the primary grocery shopper for their household completing the survey.