Soup-To-Nuts Podcast: Generation Z is coming – does your brand know how to reach them?
In this episode of FoodNavigator-USA’s Soup-to-Nuts podcast, we take a closer look at who makes up Generation Z, what characteristics and values they share, and how they think about shopping, marketing and brands. We will also take a look at how some food and beverage manufacturers already are actively engaging with this group.
Who makes up Gen Z and how much influence do they really have?
Born between 1996 and 2010, generation Z includes our country’s youngest shoppers and as such they have limited funds – but that doesn’t mean manufacturers should discount them, because they also have substantial influence over their families’ purchase decisions, according to recently released data from IRI.
In a presentation online last week, Lynn Gillis, who is a principle at IRI, explained that with an average weekly allowance of about $16 to $17, Gen Z has an annual purchasing power of only about $44 billion, but they influence household grocery purchases both overtly and stealthily. They do this by relying on a trifecta of tried-and-true approaches, including the pester approach, the hide-it-in-the-cart-and-see-if-anyone-notices approach and the ‘good value’ approach, which includes pointing out sales, deals and coupons to get the best price on what they want.
These strategies may be more effective than Gen Zers think. According to IRI, 16% to 26% of parents of Gen Zers say their children have ‘a lot’ of influence on the household’s grocery decisions, compared to just 8% to 12% of Gen Zers who think they have ‘a lot’ of influence.
In addition, IRI notes that older Gen Zers aged 18 to 21 years report directly participating in their household’s grocery shopping. In addition, the consumer research firm says that 66% of 16- to 21-year-olds and 49% of 14- to 17-year-olds report buying CPG food and beverages in the past six months
It is also worth noting that according to IRI this group represents nearly one in four of every Americans – which is about the same as the much vaunted Millennial Generation and the Baby Boomers.
Gen Z seeks products to help express themselves
While Gen Z may represent the same number of Americans as Millennials and Baby Boomers, they approach shopping and brands, very differently, in part because they are first generation of digital natives – meaning they have never known a time before the Internet and social media and the extreme interconnectedness these platforms provide.
According Risa Schwartz, senior director of consumer insights, analytics and sensory at Tyson Foods, the constant sharing and discovery afforded by the Internet means this group of consumers places a premium on products that can become an expression of themselves and boost their credibility when they post online.
“These consumers have grown up in a digital age. … They have only known phones and being able to access information at their fingertips and with that they are sharing information. They are posting pictures, they are getting information from their friends” and looking for information that they in turn can share, Schwartz said.
Given this generation’s obsession with platforms like Snapchat, Schwartz adds the real question is how do brands become Snapchat worthy? The answer, she said, is to provide an experience that the consumer wants to share with their friends.
IRI’s Gillis adds to do this brands need to use technology as a tool that supports authentic, human connection.
Earlier this summer orange juice beverage brand SunnyD launched a new campaign – its first in years – that targeted Gen Z. As part of the campaign, the brand has hosted several contests on Instagram that encourage teenagers to show how they are “Boldly Original,” which is the brand’s new tagline.
For example, in October, SunnyD asked followers on Instagram if their Halloween costumes were bold and original, and if so to post a picture of themselves in their costume, enjoying SunnyD with the hashtags #FrightDelight and #Sweepstakess to win a gift card and SunnyD swag.
Late last month, SunnyD reached out to Facebook and other social media follows asking them to submit their one of a kind skill or goal in a video as part of its ‘Show Your Bold Contest,’ which again generated content that was shareable, engaging, encouraged human connection and emphasized authentic and personalized experiences.
Both of these marketing efforts tap into another element that IRI’s Gillis says is key when reaching out to Gen Z, which is recognizing this generation is approaching cultural identity differently from previous generations. They are embracing differences. They expect inclusivity and they value flexibility, nuance and a willingness to iterate and evolve quickly.
Gen Z seeks experiences
Tyson’s Schwartz adds that Gen Z’s focus on expression also underscores their focus on experience – either theirs or those around them.
“Generation Z, they value experiences over everything else. It is the most important thing for them, and that comes to light in every aspect of their lives. So, when it comes to food it is about the experiences: How does it taste? How does it fit into the rest of my life?” she said.
Cereal-maker brand Kashi tapped into this earlier this year when it worked with five inspiring Gen Z leaders, who they dubbed the Kashi Crew, to create its first line of cereal made for kids, by kids.
According to the brand, the line includes three organic cereals that use unexpected ingredients, such as chickpeas and red lentils, and “cool shapes like swirls and filled pillows.” The three flavors are riffs on classics, suggesting some things don’t change, and include Berry Crumble, Honey Cinnamon and Cocoa Crisp.
As part of the Kashi by Kids launch, Kashi partnered with Edible Schoolyard NYC to educate children and their families about where their food comes from, how to make healthy food choices and how to positively impact the environment.
Gen Z cares more about the Earth’s health than their own
While Kashi’s campaign included elements encouraging children to make healthy choices for themselves and the planet, Gen Z is more likely to care about the latter rather than the former.
According to Schwartz, Gen Z is less fixated on health, wellness and clean label – all of which have become table stakes for many older shoppers – and more focused on the environmental impact of brands and companies.
“For this consumer, health and wellness just is not as important,” she said. “It is less about health and wellness, and what I am putting into my body. And more about doing what is right for the world and the environment.”
One way she sees this playing out is with Gen Z’s focus on organic. She notes that more than other generations, Gen Z prizes organic for what it represents for their health and that of the planet.
Tyson Foods is responding to this in part by recently acquiring Smart Chicken, which makes it the nation’s leading producer of organic chicken, Schwartz said.
A focus on convenience
In some ways Gen Z’s lack of interest in clean label and health & wellness could be attributed to their youth and change over time. On that note, Tyson’s Schwartz says another value held by many in Gen Z that could be chalked up to their age and change with time is the importance they place on convenience.
One reason they prize convenience might be because they don’t yet know how to cook, so they are looking for fast options that they can make easily or grab on the go, such as Tyson Foods’ Jimmy Dean stuffed hash browns or Jimmy Dean Simple Scrambles, which recently launched and includes in everything you need in one cup that can simply be microwaved, Schwartz said.
Not so different
Schwartz points out, there are many ways that Gen Z is not that different from their predecessors, such as their desire for convenient options and the demand to have brands meet them where they are, rather than vice versa.
IRI’s Gillis agreed, noting that main values on which Gen Z evaluate brands overlap heavily with those of older generations, including value, quality and the relationship they have with the brand.
