Monday, June 12, 2023

Gen Z Consumers are Exploring Options Is Your Company One of the Options


So, what is the big deal about attracting Gen Z consumers? Do you even need them, aren’t there enough other consumers that this cohort could be left out of your customer count mix?  No they can’t, according to Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

Now then Gen Z is a digitally native set of consumers that want food with authenticity, that saves them time aka convenience, even more they like technology sustainable food products and don’t mind that robots make their meals.

Just what are the demographic makes of Gen Z, there are nearly 70 million Americans, or about 20% of the U.S. population, and has amassed $360 billion in disposable income. Oh yeah that $360 is a big reason you want them as customers. They are 13-to-24, which comes with a wide spectrum of wants and needs according to Lindsay Lyons, group director of customer strategic insights at The Coca-Cola Company and Robert Byrne, director of consumer and industry insights at Technomic. 

Mid Mad at a session during the National Restaurant Association Show, titled, “The Gen Z Effect: Redefining Dining Choices and New Experiences for a New Generation” Lyons and Byrne provided a simple reminder that the generation is far from homogenous, which is a detail that often gets lost in the chase.

Now then just for some added context, the younger consumers in this demographic tend to be more trendy, and less eco conscious. Ages 15-to-18 are an “inflection point,” where these consumers start to drive and make money. At 18, when many go to college or start working full-time, they become more influenced by social issues, they’re more convenience seeking and they’re more likely to cook.

The two explained that basically, the older cohort of Gen Z prioritizes convenience, while the younger cohort is looking for social, fun experiences and “a vibe.” That said, they’re also extremely health conscious, but they define that focus much differently than their predecessors.

“Healthy to them is comprehensive – it means things like balance, hygiene, diet, exercise, sleep, therapy. Doing things that they want to do. It also means immunity, focus, natural, hydration, all of that together,” Lyons said.

That said, they’re also digital and Byrne noted, this is the demographic where digital curiosity is moving into digital dependency. However, that doesn’t necessarily mean they want their entire world, including restaurants, to be fully digital. In fact, Byrne said expectations versus reality for this age group may be a bit surprising compared to their older peers. Consider that 23% of Gen Zers find food delivered via robot to be unappealing, for instance, while 38% find it to be appealing. This is compared to the 22% of millennials who find food delivered via robot to be unappealing, while 45% find it to be appealing.

Further, 30% of Gen Zers find food delivered via drone to be unappealing, while 32% find it to be appealing, versus 23% and 48% of millennials, respectively. As for those robot servers? Just 32% of Gen Zers find them to be appealing, versus 47% of millennials. What does this mean?

“Be careful with your extension of technology. There may be less receptivity to technology than one might think,” Byrne said. (Note: from the team at Foodservice Solutions® less than 1 percent have ever a drone delivery)

One reflection of the times we are now living, of the most important attributes sought by Gen Z is value, as 46% of these consumers have a second job according to Deloitte research. Byrne said price consciousness is based on necessity as many of these consumers are living hand-to-mouth.

Gen Z consumers definition of “value” extends well beyond price and their price sensitivity threshold actually decreases compared to other demographics. 68 percent of Gen Zers pay close attention to menu prices to find the best value, for instance, versus 71% of millennials who do the same. Sixty-three percent of Gen Zers “always compare prices before deciding what to buy,” versus 65% of millennials.

Now much like those before them, “Fewer than one-third of Gen Z consumers plan to cut back on restaurant usage because of high menu prices, which is below average. Menu price on its own is fading as part of the overall value equation,” Byrne said.

In an odd twist, the two reported that Gen Z consumers care “significantly less” concerned about menu price comparability, then the visual appeal of food, knowledgeable staff, clean bathrooms and being treated like a valued customer than their older counterparts.

So just what do they care about?

·         Effective advertising (another odd finding)

·         Natural, organic, sustainable, responsibly sourced items

·         Digital ordering/payment capabilities

·         Tech-enabled features to improve the overall experience

·         Kid-friendliness

·         Loyalty programs/rewards

Here is what was even more clear, YouTube is Gen Z’s most preferred social media channel, so that is a critical place to reach them. To illustrate the criticality of this channel, two out of three Gen Z consumers experience a brand for the first time on YouTube. That said, YouTube tends to feature long-form video and younger Gen Z consumers prefer short-form videos such as those found on TikTok, Instagram and YouTube Shorts, so this preference may be changing.

Overall, social media in general is usually the first place Gen Z consumers will interact with a brand, which is important because much of this content is organic and “therefore more trustworthy and less suss,” Byrne said.

Their favorite brand is Nike, which is noteworthy because it’s a lifestyle/luxury brand that consumers do not buy every day. What do Gen Z consumers buy every day? Food and beverage; therefore, food and beverage companies would be wise to understand the draw of Nike, according to Lyons, and that is mostly authenticity.

Yes, there is more, despite that $360 billion chest full of disposable income, their social and digital nature and their desire to have a “vibe” and an “experience,” Byrne cautioned, “Gen Z is not here to save your business.”

With more information available faster than ever before and in the palm of their hand, Gen Z seems to have not been trained to be a loyalty or frequent customer. There is hesitancy and discernment,” he said. “That’s why you have to be authentic.”

“They don’t want to be confused, so be very clear about what you’re doing,” Lyons added. “Meet them where they are, pull them in and make it that comprehensive experience they want.”

Attending the National Restaurant Show and visiting breakout sessions can be of great value for any fresh food retailer. However, ask questions, follow up questions to help improve your own insights.

Don’t over reach. Are you ready for some fresh ideations? Do your food marketing ideations look more like yesterday than tomorrow? Interested in learning how Foodservice Solutions® can edify your retail food brand while creating a platform for consumer convenient meal participationdifferentiation and individualization?  Email us at: or visit us on our social media sites by clicking the following links: Facebook,  LinkedIn, or Twitter

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