8 Ways to Connect Food Stores to Millennials

June 01, 2015

Here's how to become the destination for Gen Y, once they're ready to form families and consume more.

Originally published in the free, weekly e-newsletter, Facts, Figures & the Future.

The closer the Millennial connections, the brighter the prospects for supermarket retailers. Grocers that understand and serve them better than competing channels should be poised to stem share erosion, possibly reverse it, and become destinations of choice when Millennials marry and have babies at later ages. 

Give Whole Foods Market credit for being open about its plan to develop a sister chain of smaller, tech-rich stores with lower prices to be more affordable to younger shoppers - this tech-savvy, food-adventurous, but financially strained cohort of 80 million. Wall Street investors did punish the stock price at first over fears of cannibalized sales and margins, but Facts, Figures & The Future (F3) sees the WFM initiative as a potentially innovative step to resolve the Millennial challenge facing food chains today. Our view is supermarkets nationwide must acknowledge Millennial differences and life challenges, and alter businesses to be part of their food futures - whether or not the new WFM format turns out to be a winner.

F3 has eight steps in mind for supermarkets to consider:

1. Put Millennial workers in the ears of corporate leadership.Keep stores sensitive to their trip planning and shopping patterns, their use of mobile, apps and other technology, what they want from stores and websites, what they share and say on social media about foods, beverages, brands and stores. This also means hiring more Millennials into growth positions. See our related story. (5 Key Culture Steps to Successfully Recruit Millennials)

2. Curate selections. Create excitement in line with Millennials' adventurous palates, since they help spearhead food trends such as artisanal, ethnic, local and organic. Do this within smaller store formats to help them be more efficient picking up satisfying choices.

3. Show you have their safety and health in mind. Prominently display antibiotic-free and grass-fed meats, locally farmed fresh foods, organic choices, and less-processed foods in center-store, especially in baby foods and pet foods. Also, have a great recall system.

4. Keep their fun in mind too with grocerants, craft beers on tap and in growlers to go. Be cool. Spur Millennials to take a quick brew and food break, and supply inventive drinks for playoff parties and other fun beer-based events at home. Where grocerants are available - at chains such as Wegmans and Hy-Vee - nearly 60% of respondents to a SupermarketGuru poll say they eat there because it's convenient, 36% because they can food shop on the same trip, 32% because it tastes good, and 31% because it costs less than a restaurant.

5. Communicate the way they want - run omnichannel. The generation that lives on Seamless and GrubHub with restaurant food wants similar convenience from supermarkets - to order via website or app, then pick up or have food delivered. For store shopping, power has shifted to mobile-toting Millennials who research food products, compare prices, find sales and coupons, and plan to recipes as they gain confidence in the kitchen. 

6. Step up the pace - when introducing new foods, serving Millennials face-to-face or via technology, running checklanes with safer high-tech payment systems, staging themed events, and executing store pickup and delivery. Joe Gagnon and Jason Dorsey, co-authors of The Aspect Consumer Experience Index, say "Millennials, mobile technology and social media are colliding to radically change customer service as we know it. This new generation will not tolerate waiting in lines...or being treated like a number. Companies that do not adapt risk obsolescence...." The study says 36% of Millennials would contact a company more often if texting were an option, and 47% of them regularly pay for goods via smartphone.

7. Have transparent sustainability policies and support charities. Be in sync with Millennials who want to make the world a better place.

8. Be affordable. Millions of this generation are under-employed and burdened by college debt and high rents.