Six Trends CPG Brands Must Embrace To Win With Millennials
Millennials will spend $65 billion on consumer-packaged goods over the next decade, which makes them one of the most important cohorts for grocery stores and retailers. The challenge for most of them, however, is that the 80 million millennial consumers shop much differently than older generations.
For example, millennials have a trade up-trade down mentality, meaning they will spend a modest premium on brands they deem worthy, but buy private label brands when the brand has failed to create a reason enough value to warrant the premium. A millennial shopping cart will be stocked with a mixture of name brands and private labels on the same trip. For example, Target’s Archer Farms brand has experienced success with savvy millennial shoppers.
Where millennials choose to spend their money also differs from older consumers, who are more likely to shop in traditional grocery stores. According to study that polled more than 4,000 millennials,only42 percent said they shopped at local or chain grocery store compared to 55 percent of those 35 years or older (Disclaimer: These statistics come from the comprehensive American Millennials Report I published with FutureCast and Barkley US).
Another way millennials differ from older consumers is that they see shopping as a social activity, often doing so with friends and family. Lastly, they put greater value on shopping amenities. The study found that 60 percent of millennials rate delis as a key criteria compared to less than 50 percent for older generations. Millennials are also looking for exotic foods, child-friendly stores, samples of new foods to try, creative menu ideas and online ordering systems.
What does this mean?
CPG brands and retailers must redesign themselves and their processes to meet the demands of millennial shoppers. Below are six must-follow trends that will help CPGs connect with millennials.
Millennials have stronger connections with brands that promote sustainability in addition to corporate responsibility. The combination of these two values encourages companies to implement viable business practices throughout the entire ecosystem. That includes suppliers, consumers, employees and more. Consumers are at a point where it takes an incredible amount of effort to live a more sustainable life, so winning brands will show them how their products can help them in their efforts.