Thursday, August 20, 2020

Moo-ving onto Gen Z

It happened. My husband and I got our two sons settled into the University of Illinois Urbana-Champaign this week and we are empty nesters. (I’m loving it!) They are part of Gen Z, the most ethnically diverse generation in U.S. history. And, sadly, a generation that does not know how to address an envelope.  They also won’t ever have a checkbook, need quarters for laundry or have to work with college roommates to claim their calls on the long-distance phone bill.  

They are also your most important customer. They just spent the past five months close to home and eating at home, where all types of dairy foods were being served, as is or in recipes. The dairy industry needs to keep them buying dairy, so focus in on their needs and wants. 

Gen Z encompasses those between eight and 23 years old, and represent more than a quarter (26%) of the U.S. population. The American Egg Board chronicles this young generation in a recently published white paper, “Gen Z: A New Generation to Feed.” It explores this generation’s preferences and identifies food and beverage market opportunities. You can download it HERE. (I highly recommend it. Great info!)

Digital natives, Gen Z is 48% non-Caucasian and has an estimated purchasing power of between $29 billion and $143 billion. 

“The preferences of this generation are likely to influence the food and beverage segment for decades to come,” says Elisa Maloberti, the American Egg Board’s director of egg product marketing. “Their ethnic diversity and interest and affinity for global flavors are already asserting influence in the food and beverage market. And this will only grow as more of Gen Z leaves home and makes all their own food choices.” 

One of the most profound influences of Gen Z is their desire to know more about the food they eat. They want to know where and how it was grown, how it was processed and how it impacts the planet. Often referred to as unintentional foodies, Gen Z is not as enamored as millennials with cooking, but they’re growing up eating sushi and ramen along with tacos and hummus. Gen Z is also eagerly embracing plant-based foods as part of a flexitarian lifestyle. They don’t eschew meat eating, but are open to going meatless more often when opportunities avail themselves. Plant-based eating is perceived as a healthier choice and one that is better for the planet. They still love dairy!

Because of their multicultural background, Gen Z enjoys experiential dining, which often includes sharing and snacking. They like to share in-person and virtually in equal measure, although sharing over social media at times takes precedence over actually eating. In fact, Gen Z accounts for 75% of all Instagram users. This sharing behavior has been curtailed somewhat by the pandemic, but these inclinations will no doubt rise to the surface again when schools reopen and socializing normalizes. In the meantime, Gen Z continues to prefer snacking over eating traditional meals three times a day.

The older members of Gen Z came of age during the Great Recession of 2008, and maybe watched their parents struggle with the economy and job market. They will likely experience another recession soon and this will make them revisit the cost-cutting measures and savings their parents had practiced.  

A few years ago, Dairy Management Inc., (DMI) conducted both quantitative and qualitative research on Gen Z. I dug it up and am sharing it now, as it’s very insightful. 

“We talked to the kids, their parents, teens and their friends, and they really gave us great insight into what their core values are and how we can make a difference for them,” said Judy Whisler, DMI vice president, knowledge and insights.

“We’re actually seeing quite a few differences from Gen Z and Millennials,” she said. “A lot of it comes from how they’re shaped from events in their formative years. For example, this is the first generation post 9-11, and they came of age during some significant social change. And of course, everyone talks about how digitally native Gen Z is. The flip side of that is they understand the risks around social media, and they’re much more private than Millennials.”

The DMI research showed that Gen Z is much more serious and goal-oriented than Millennials. This likely intensified this year from COVID-19. Overnight they had to adjust to e-learning. They had so many rights of passage stolen from them, everything from being an All Star to walking across the stage for a diploma. (My college freshman, included.)

“When we interviewed these kids, it was almost impossible to overstate how many demands and pressure they were under,” said Whistler. “We did interviews during the summer months, and there were still all kinds of obstacles for doing and getting done, whether it was for sports practice or getting ready for SATs.” 

Many of those kids now wonder why they bothered. Their priorities have changed. 

When this research was conducted in 2017 to 2018, Whistler explained that Gen Z’s thoughts on “healthy” not only included exercise and eating right, which is how other generations defined healthy, but it also meant feeling strong and positive about the future.

Again, this past year has intensified this perspective. 

“The end result is that dairy needs to deliver more than just a functional need--energy or diet--and get to a higher level of giving them the confidence and strength to succeed,” she said. 

Gen Z strives for healthy calories rather than empty calories. They are interested in protein, paying attention to labels and monitoring their sugar intake. They’re interested in fresher, less processed foods and want to know which ingredients to add or avoid.

They appreciate local. They also value the planet. Your sustainability efforts matter to them. 

Gen Z grew up on Starbucks and smoothies. Both contain dairy. Lunch packs and hand-held sandwiches were frequent meals and snacks in the back seat of the minivan as they were ushered between activities. Both contain cheese. (I’m guilty of all.)

Gen Z has always known yogurt to come in tubes and be drinkable. They embraced chocolate milk as a sports recovery drink, while missing it as part of their school lunch program. 

The future is uncertain. Gen Z is a work in progress, yet, they are our future. Let’s keep dairy foods relevant to them. 

P.S. I was so pleased to look inside by junior-year son’s apartment fridge after he shopped by himself and see a gallon of 2% milk, shredded Mexican blend cheese, shredded mac and cheese blend, butter and vanilla yogurt. Mama raised a smart-shopping Gen Zer. 

Need assistance with sugar reduction? Plan to attend the virtual “REFORMULATE: Advancing Sugar Reduction Technologies” conference on September 9. This event has a faculty of scientists and industry experts who will explore next-generation, natural sugar reduction-enabling technologies and ingredients. The goal is to connect with R&D decision-makers across food and beverage to provide actionable insights and approaches to successfully reformulate clean-label, consumer-accepted, taste-first, better-for-you, low- and no-sugar food and beverage products. This event will explore future trends, changing consumer priorities alongside technical, formulation and manufacturing considerations to inform the future of your sugar reduction R&D beyond the use of traditional sweeteners.

Whether you have a product in the market to reformulate or are looking to launch into the growing low- and no-sugar, better-for-you market, this meeting will equip you with the information and partnerships to succeed.

Why This is an Unmissable Event:

  • Discover the changing consumer trends reshaping the food and beverage industry, and identify the actions needed to positively align your products with future consumer purchasing patterns to gain market share and protect the sustainability of future earnings.
  • Determine how to effectively integrate a low- and no-sugar strategy into your current business model by developing a sustainable portfolio and communicating this with the consumer.
  • Navigate and overcome the formulation and manufacturing challenges that can arise when replacing sugar to ensure your products do not compromise on taste, function, stability or caloric density. 
  • Discuss next-generation sugar processing technologies including physical, chemical, enzymatic and microbial methods, to reduce the sugar content of your food and beverage products, beyond the use of traditional sweeteners.
  • Explore the cutting-edge scientific research in the field of sugar consumption and metabolism to inform your future R&D decisions.

Access the full event guide HERE for all details on the agenda.

This conference is being produced by Hanson Wade.

1 comment:

  1. Hi Donna,
    Address an envelope - yep! Plus find a post office, buy a stamp, mail it - all totally alien to many in this generation! (But full disclosure, my son had a job in the mail room ay college so he learnt it all!)