Gen Z shoppers are more likely than non-Gen Z to say they have reduced their grocery budget due to economic uncertainty, according to a Chicory report released earlier this summer.
In the survey, 1,000 shoppers participated. Half of them were Gen Z shoppers (young adults born between 1996 and 2010); half were members of older generations: Millennials, Gen X and Baby Boomers. For context, most Gen Z shoppers do not remember September 11th, are digital natives and experienced part of their teens or college years during the pandemic. The majority of shoppers, regardless of generation, expressed concern about economic uncertainty in the US. However, the youngest shoppers – Gen Z – appeared to take these concerns to the grocery store in ways that distinguished them from older shoppers. More than a third of them have reduced their grocery budget and are leaning into affordability, convenience and creativity.
“Our research showed that food manufacturers and grocers need to position their products as convenient, helpful solutions that can help consumers do more with less – whether it’s highlighting multi-use ingredients, communicating long-term value, or showcasing budget-smart recipes,” says Yuni Baker-Saito, co-founder and CEO of Chicory.
Fakeaways and online recipes
Gen Z are eating out less and turning to the Internet for recipes, including recipes inspired by their favorite takeaway. According to the Chicory survey, a majority of Gen Z consumers – 71% – said they have recreated takeout meals at home, while 72% said they occasionally or often use online recipes to help lower food costs. Online recipes may steer them toward different brands, including store brands or lower cost items. In contrast, older generations are more likely to favor brand loyalty.
Baker-Saito encourages brands to consider where customers may be thinking about their food shopping. One strategy could involve buying ads on recipe sites; another could mean using targeted ads in-store.
“We need to move from targeting consumers across the web to targeting them in those moments that matter, when we know they are actively thinking about their grocery purchasing,” he says.
Less meat and alcohol
Gen Z shoppers are consuming less meat and alcohol. In the survey, it became clear that Gen Z is not eschewing protein altogether. Rather, they are swapping more expensive protein sources, like steak, for more cost-effective ones, like beans. Baker-Saito points out that this may not simply be due to personal grocery budgets but personal ethics, too.
“Various studies have also shown that Gen Z are more mindful when it comes to drinking and the impact that meat has on the environment, and how this in turn has influenced their food and drink choices,” he says.
Deliver premiums and beware the dangers of discounting
Gen Z shoppers want apparent value. That does not necessarily mean a bargain.
“Heavy discounting can erode brand perception, and building that brand equity back will be tough,” says Baker-Saito.
So how can food manufacturers and retailers appeal to Gen Z at the grocery store? Thinking from the customer’s perspective of how products could get swapped in recipes and, again, placing digital ads that are targeted, not splattered across the Internet.
“Showing the versatility of products is one way. If a product can be used in multiple recipes to create different meals, the consumer might find it easier to justify the purchase – even if it is perceived as a premium, higher-cost product,” says Baker-Saito.
All in all, Chicory’s key takeaway is to avoid a ‘one-size-fits-all’ approach, as Gen Z and older shoppers are simply not the same.
