Age is just a number. In business, however, it can be a very important one. That’s because every generation has distinct interests and values that shape its collective preferences regarding retail, including micro markets. Accommodating clients whose workforce encompasses multiple age groups can therefore be tricky.
“There are subtle and distinct differences between the drivers and preferences of the different cohorts,” says Malcolm McAlpine, business manager, foodservice, branded snacks and confections at Mondelēz International. “As a new generation enters the workforce, operators must be far more ruthless in category management and their selection of snacks so they can appeal to all generations. They must be careful about how they purchase products and stock their vending machines and micro markets. Instead of buying products that are on deal or are at a good price, they should stay on top of trends and buy snacks that index high with the demographics they serve.”
The differences in product preferences between the Gen Z and millennials generations alone are noteworthy.
“Both generations share an interest in trying new and bold flavors, as well as ethnic foods. While both cohorts claim to seek health and wellness, Gen Z's snacking habits trend more toward indulgence,” McAlpine explains. “Gen Z tends to snack more than millennials and has a high expectation of the quality of the snacks and beverages they buy. For example, they prefer food that uses local and sustainable ingredients, and they are not willing to sacrifice flavor.”
With the following strategies, operators can provide food and beverage options that satisfy members of every generation. The key is recognizing values that consumers of all ages share—and being adaptable enough to oblige them.
Although each generation in the workforce has attributes that make it unique, there remain common preferences that span across all age groups—especially when it comes to food and beverage. By keeping these shared preferences in mind, micro market operators can develop universal appeal.
For example, studies have revealed that one thing all generations crave is natural food. Global consulting firm L.E.K. Consulting found in a 2018 study that 35 percent of millennials, 32 percent of Gen Xers and 26 percent of baby boomers are committed to purchasing food in the “natural” category, which includes foods that are organic, non-GMO, and without preservatives or artificial ingredients. Market research company The NPD Group found that Gen Z is even more interested than millennials in organic and non-GMO foods.
Sales and marketing agency Acosta reported that protein—from both plant and animal sources—is another multi-generational trend. Sixty-six percent of baby boomers, 74 percent of Gen Xers and 81 percent of millennials said seeing a food’s protein content encourages them to purchase it. Because it supports their love of a physically active lifestyle, Gen Z also is sold on protein, according to Innova Market Insights.
Micro market operators can exploit these trends by promoting products that embody them. One idea for doing so, Acosta suggests, is providing informational cards alongside products that explain their nutritional claims and content. After all, research has indicated that consumers are drawn to natural food and protein because they seek “better-for-you” foods. The snacks you sell in your micro markets can facilitate these needs. In fact, 76 percent of Americans say snacking helps them with nutritional needs like managing calories, according to Mondelēz International’s first-ever State of Snacking™ report.
“Operators should utilize various sources for trends and start stocking the on-trend, high-quality, great-tasting products that Gen Z is looking—and willing to pay—for,” Mondelēz International’s McAlpine adds. “Brands like FIG NEWTONS and LORNA DOONE tend to index high with baby boomers and Gen X, [whereas] TRISCUIT, RITZ, OREO and belVita are favorites among millennials. CHIPS AHOY!, SOUR PATCH KIDS and belVita have strong appeal with Gen Z. Among all of the Mondelēz International brands, OREO, RITZ, CHIPS AHOY! and belVita are the brands that index high across all generations.”
Environmental sustainability is important to every generation, multiple studies have found. For example, a study the IBM Institute for Business Value conducted in association with the National Retail Federation found that approximately 75 percent of every working generation—from Gen Z through baby boomers—views the attribute of “sustainable/environmentally responsible” as very, extremely or moderately important.
However, consumers agree that it is difficult to know whether the food choices they make are environmentally friendly. According to the International Food Information Council Foundation’s 2019 Food and Health Survey, 63 percent of consumers say sustainability would play a greater role in their purchasing decisions if it were easier to determine eco-friendly food choices.
Clearly, micro market operators have an opportunity to showcase how certain products are environmentally sustainable. Ideas for doing so include describing what measures manufacturers have taken to protect the environment and explaining to customers how they can also protect the environment by embracing reusable or recyclable materials.
Trends change over time. Customers who express interest in spicy foods one year may change their minds the next year due to health reasons or a simple change in preferences. The demographic makeup of the workforce also may transform. As younger generations displace older ones as the majority of the workforce, for example, operators will have to adjust how they satisfy customers’ snacking needs.
“While they might not have to worry about younger generations just yet, operators should definitely start getting ready for Gen Z if they haven't already,” says McAlpine. “In order to prepare for Gen Z, operators have to make sure they have high quality, great-tasting snacks, as they expect functional and portable snacks that don't sacrifice taste or flavor.”
“One of the greatest threats to our industry is—and has been for the past five years—the rate at which we adapt to the changes in the business environment,” says C.J. Recher, vice president of marketing at Five Star Food Service. “If we as individual operators and as a collective industry don’t adapt quickly enough, we risk losing potential incremental growth opportunities, as well as allowing external competition to creep into the space.”
McAlpine suggests many sources operators can look to for news and trends that will help them run their operations.
“Operators should reach out to their local suppliers or manufacturers as a primary source of information as they typically have their own data and research,” he says. “In addition, trade publications like Automatic Merchandiser and NAMA are good sources for new product information and trends in snacking and technology in the industry.”
Operators should also ensure their consumers have multiple options for purchasing products. “By making their kiosks and machines capable of various types of payments, they provide accessibility to every customer, whether baby boomer or Gen Z,” McAlpine explains.
For example, operators should ensure consumers can pay via app—Gen Z’s preferred method—at kiosks and vending machines, he says. Operators serving Gen Z should also consider promoting offers or deals that can be redeemed on the spot, which will resonate more with Gen Z than loyalty programs or apps.
“From a technology perspective, Gen Z is more advanced,” he continues. “In general, they are more comfortable with and accustomed to app payments and mobile ordering.”
Personalized service
Ultimately, even the best research of generational preferences and purchasing habits relies on generalizations about groups that include millions of individuals. These studies therefore provide guidelines, not rules. Whatever the generational makeup of your clients’ workforce, providing optimal customer service is key to success. For the best results, find out what your customers want and provide personalized experiences in response.
Are you seeking advice about how to accommodate clients who ask for healthy options in your micro markets? Here are five best practices to help you meet their request.
