Learning Your ABZs

The youngest group of consumers is going to change the world. Are you ready for them?

By 
Samantha Oller, Senior Editor/Fuels, CSP

Mitch Morrison, Vice President & Retail Executive Platform Director, Winsight

Erik J. Martin, CSP Correspondent

Illustrations by Nick Shepherd

Hungry Youth Truths

C-stores have a chance with Gen Z--if they focus on fresh

They may be pizza-pounding teens and early 20-somethings, but Gen Z has a healthier hankering for more freshly prepared, made-to-order and do-it-yourself consumables than you might assume. Consider these CSP-Technomic report findings:

  • More than one-third of all Gen Z food/beverage purchases within c-stores are from the foodservice/prepared retail area.
  • Nearly 40% of this age group is purchasing prepared foods and beverages more often from c-stores than a year ago.
  • Nearly every time they visit a c-store, Gen Z shoppers purchase food (55%) and beverages (69%) from foodservice areas.

“When Generation Z visits a convenience store, they’re generally looking to satisfy an immediate craving,” says Rachel Kalt, senior strategist for The Culinary Edge, San Francisco. “However, it’s important to remember that this generation prefers freshly cooked meals to frozen and has a greater interest in cooking compared to previous generations,” which plays into their purchasing decisions of prepared foodservice items.

Want to get more high school and college students in the door? Made-to-order food stations, hot/cold food bars, roller grills and restaurant chains inside the store are among the amenities that make Gen Zs more inclined to visit a convenience retailer, according to the CSP-Technomic survey.

“Gen Z is do-it-yourself oriented,” Kalt says. “Their hands-on approach to life means they’re interested in opportunities to customize their food and beverage items.

Being able to allocate their dollars as they wish and having a lot of food options within one environment is convenient for them.”

Tom Vierhile, innovation insights director for Canadean Consumer, which has global headquarters in London, says teens today are raised on dining out, “so it’s not much of a surprise that younger consumers are more likely to visit convenience stores that offer enhanced food options.”

To help you get over any inferiority complex about fast-food competitors, consider this: According to the CSP-Technomic survey, Gen Z views c-stores as comparable to or better than QSRs when it comes to beverage variety and beverage quality (89% each); speed of service (85%); overall value (78%); food flavor/taste (71%); healthy-food availability (71%); food variety (64%); and food freshness/quality (60%).

“This is a generation that has grown up in the car, getting ferried from one thing to another, with snacking and food consumption habits established early,” Vierhile says.

In fact, 15- to 17-year-olds had the lowest preference for eating at home rather than a café or restaurant, according to results of Canadean 2014-2015 surveys of U.S. consumers.

Gen Z also yearns for a social experience in which their power as a consumer can be felt. “A lot of Gen Zers aren’t old enough to drive or go to a bar, and many don’t have the financial means to sit in a restaurant and enjoy a full meal. But they can go to a c-store, buy a bunch of items, demonstrate agency and independence, hang out with their friends and socialize, which is significant,” says Kalt.

Make ’Em Happy

To spike foodservice sales among Gen Z, c-stores should focus on choices that offer better ingredients, taste and value, Technomic data indicates. Fifty-seven percent of respondents say they would be more inclined to purchase prepared foods if c-stores offered higher-quality options, and 51%--only a percentage point below more affordable options--said the same for healthier options.

“Gen Z is more food-aware and more informed about healthy foods and nutrient density, due in large part to pervasive food media around them,” says Kalt. “It’s cool these days to be young and into food, and there’s a hipness to knowing about ingredients and where ingredients come from.”

Vierhile agrees that younger consumers increasingly expect healthier, higher-caliber products. “Think about the quality message an offering from a foodservice outlet like Panera Bread may convey vs. a stereotypical roller-heated hot dog from an old-style convenience store,” he says.

But don’t kid yourself: Technomic reports that classic c-store fare remains tops among 16- to 22-year-olds. Pizza is the menu item most often purchased, followed by doughnuts and desserts, by Gen Z.

“Some indulgences never go out of style. Doughnuts are timelessly appealing. And there’s an element of shareability to pizza when they’re hanging out with friends,” Kalt says.

Also, Gen Z is more likely to opt for foodservice liquid-refreshment staples such as fountain soda and brain-freeze favorites than other beverages, including packaged energy drinks, per the Technomic report.

Tap into Gender, Generation Gaps

Be careful not to adopt a “one-size-fits-all” approach to Gen Z, because male and female constituents differ on many foodservice preferences. For example, regarding made-to-order offerings, the Technomic report indicates females more strongly prefer salads (43% vs. 25% for males), frozen desserts (56% vs. 41%), smoothies/slushies (50% vs. 38%), coff ee (39% vs. 28%), healthier options (58% vs. 48%) and samples (56% vs. 46%).

“Women at this age are concerned about their image, and some of these healthier options offer reduced calories,” Kalt says.

“Males may be buying less healthy options, but many Gen Z boys could be burning a ton of calories being involved in sports and activities.”

Gen Z and millennials are decidedly different demographics, too, when it comes to foodservice preferences. For example, Gen Z is less likely than millennials to say that combo meals, made-to-order food stations, food bars and roller grills would encourage c-store visits, according to Technomic.

Compared to millennials, Gen Z is also less likely to purchase hot dogs, retail frozen breakfast entrées and packaged side items such as chips, but more likely to buy fruit, cereal and yogurt at c-stores. In fact, many Gen Zers polled by Technomic indicated an interest in vegan/veggie foods.

Next: Fuel Futurists