A Millennial Mindset
How the unpredictable demographic is shaking up the food industry
What’s the hottest buzzword in the food industry today? Millennials.
It seems that every major food company is trying to understand this unique audience and many are blaming them for the seismic shifts that are taking place in the food industry. Without a doubt, Millennials have extremely different food preferences, eating habits, shopping patterns and views of brand loyalty than generations that have come before them. They’ve challenged almost everything we’ve known to be true in the industry. The impact of these changes is felt most dramatically among the top food manufacturers in the country. Based on a recent report by Credit Suisse, the 25 largest food companies have seen their share of the market decline from 49.4% in 2009 to 45.1% share in 2014. Massive layoffs have happened at all the major food companies. Consider yourself one of the luckiest in the industry if you are reading this and are still employed.
To understand why Millennials act so differently, we must first understand their world. In my generation, we all followed the same path and were assured of positive results. We worked hard to get into a good college. We studied hard so that we could get a good job upon graduation. After establishing ourselves in the working world, we then got married and a few years later started a family.
The road looks incredibly different for today’s Millennials and it is not the straight path that previous generations have walked. In fact, they are rethinking every step of the path and finding that even if they do follow the straight path of previous generations that they may not end up with the same results. Some high school graduates are making the decision to forgo a college education and get right into the working world. Those who do go down the college path may find that they are not employed after an expensive four year education and now have crippling debt. In fact, the largest percent of our nation’s unemployed are Millennials. As a result, approximately half of Millennials are moving back home to live with their parents after college. They are delaying the decision to marry and rethinking the idea of whether or not a marriage certificate is even necessary. Over half of all babies born to Millennials today are born out of wedlock. This ensures that our family structure will certainly look different in just a few years.
For Millennials, there has never been a clear payout of what would be received by following the traditional path. So, unlike previous generations they challenge the norms and blaze their own trails. Therefore, it should come as no surprise that they have different attitudes and behaviors regarding food and shopping patterns.
Brand loyalty? It’s not that Millennials are fickle and that they don’t care about the brands they buy. Again, the universe has shifted versus previous generations. Millennials don’t have the same nostalgia for brands they grew up with because they were born in an era of brand choice. For Boomers and Gen X, there were only a few different brands to choose from in each product category and there was a noticeable variant in the quality of private label store brands versus the national brands. Today, there is an influx of brand choice in nearly every category and in many cases the private label brands are as good as (and sometimes better than) the national brands. The mindset of previous generations was to stay loyal to a brand if it worked well for you. There was no need to switch or look for an alternative. But today, there are many options that work quite well. Why not explore a variety or choose the one that is on sale this week?
Why do we expect that Millennials will change their behaviors and needs to adopt brands that worked for the Boomer generation? The brands that resonate most with Millennials are those that fit into lifestyle that is very different from that of their parents or grandparents. They are looking for grab-and-go protein snacks in the morning like smoothies, bars and yogurts and aren’t likely to sit at a table and linger over breakfast after their morning workout. Product categories like cereals are playing catch up to try to maintain their relevancy with this audience.
Shopping behaviors are different too. Understanding the wide range of options they now have available, Millennials are more likely to shop a number of food stores to find just the items they want. They tend to shop the perimeter of stores to avoid middle aisles filled with processed foods and artificial preservatives from classic big label brands. They are more willing to support local purveyors and farms. And like everything else in their world, they like to share their preferences by celebrating proudly on social media with hashtags such as #eatyourcolors, #shoplocal and #nofarmsnofood.
Despite the large range of things that unite Millennials, there are also many things that differentiate them from each other. If you think immediately of a hipster in a quirky t-shirt and ski cap, constantly plugged in yet tuned out to the rest of the world, then you would be wrong about Millennials.
In reality, a Millennial is defined as someone born from 1980 – 2000, or someone 16 to 36 years old today. Does anyone believe that the needs, wants and wishes of a 16 year old girl are the same as a 36 year old single man or a 25 year old parent? A lot of the food companies are talking about “Marketing to Millennials”, and this kind of strategic vision is doomed to failure amidst the diversity of the real generation of Millennials I’m on a mission to ban this terminology of “marketing to Millennials”. It’s absurd to think that a teenage girl, an adult single man or a young parent are all searching for the same types of products. It’s nearly impossible to market to this broad audience in a relevant way. Our sister agency, Carat, has spent a lot of time and resources digging deeper into the minds of Millennials. CEO, Doug Ray, says, “Marketing to Millennials is like marketing to an entire country”. Nobody should ever say they are “marketing to Millennials” because it can’t be done effectively.
Within the Millennial audience there are several different behavioral and attitudinal segments. In the recent “Millennial Disconnect” study that we conducted in partnership with Carat, we learned that the stereotype of being a hyper-connected, optimistic digital extrovert only applies to about 42% of Millennials, or about 36 million of the total 85.7 million in the generation. Surprisingly, only about half of Millennials say they couldn’t live without their Smartphone. Don’t be so quick to think that you understand Millennials. They are a very diverse group with vastly different mindsets. In the study I am going to talk about here, we will look at some of those differences by examining Millennials’ outlooks regarding food and health.
So, how do you effectively target the vast audience of Millennials? At Forbes Consulting Group, we’ve identified a technique called MindSight® Motivational Profiling that has proven to be a useful tool for segmenting the Millennial audience by examining the subconscious emotional motivations that drive their lifestyle choices, and their behavior as consumers. In 2011, Dr. David Forbes created the MindSight® tool. The patented MindSight® approach applies principles of neuroscience to access emotions before conscious “editing” from the rational mind. The MindSight® Motivational Matrix provides the analytic framework for the MindSight tool. Based on more than 100 years of psychological theory on human motivation, it is an academically accepted model for interpreting emotional responses via nine core human motivations such as Security, Empowerment, Achievement, Nurturance, Belonging, and so on.
In a recent study using MindSight® Motivational Profiling, we surveyed 800 millennials between the core ages of 18-29, measuring rational and emotional/subconscious motivations regarding health and food. Respondents engaged with the MindSight® exercise as a sentence completion task. In this case, the stem sentence was “When I think about the way I take care of myself I wish I could feel more ______.” Respondents were shown a series of pictures designed to evoke the emotions associated with the nine core motivations. They were shown these images in a rapid sequence (800 MS exposure each) and selected each picture that mirrored matched their feelings on the topic, and ignored those that didn’t match. Based on the pattern of selected pictures, we are able to create a motivational profile of each respondent.
Using this technique, we are able to get beneath the similarities in Millennial behaviors relating to their health (which are many), to uncover different patterns of emotional motivations driving behaviors and attitudes into three distinct sub-groups of Millennials. This allows us to better understand how to effectively target them as consumers. These segments are extremely different in their attitudes towards health. We call them the Health Connectors, Health Actives and Health Individualists.
MindSight® Motives Identified: Security, Belonging, Nurturance
Health Connectors tend to skew female and married. They are heavy users of fat-free foods and weight-loss programs and more likely to have had plastic surgery or gastric bypass surgery (although it was still an extremely low percentage). This group’s concern with weight loss and appearance make them ideal targets for product offerings that are fat-free, low-fat, low-calorie and sugar-free. Their motivational profile towards health and even weight loss is influenced by their need to feel secure, and the need for belonging and nurturance. The MindSight Motivational profile of this group suggests that a marketing strategy with advertising that emphasizes coziness, warmth, families and togetherness will be most effective.
MindSight® Motives Identified: Empowerment, Mastery, Achievement Health
Actives are educated, liberal-minded, single males whose motivations for health are extremely different from other segments. This group is likely to have a gym membership, compete in fitness competitions and share their daily progress and routines via social media sites such as Facebook, Instagram and YouTube. Their emotional motivations centered around Empowerment, Mastery and Achievement. (Motivations that can be seen in activation when this group goes regularly to the gym.) Marketing strategies to target Health Actives should emphasize physique, strength, reaching personal goals, gaining expertise, and being up for anything. Health Actives are ideal targets for manufacturers or distributors of organic, high-energy foods and beverages that promote ultimate health and performance.
MindSight® Motives Identified: Identity, Mastery, Esteem
Health Individualists don’t skew toward any particular demographic but uniqueness in personal appearance is important to them -- as evidenced by a higher likelihood of having tattoos and body piercings. Individuals in this segment make up their own rules, and challenge the norm when it comes to lifestyle and health. As a result, they are likely to break the “all health all the time” norm to indulge in cigarettes, cigars, ice cream or candy. Health Individualists like to make a statement with the products they buy (i.e. socially responsible brands, locally-produced foods, etc.), and they value brand transparency (i.e. listing nutritional ingredients, honest labeling, etc.). Their lifestyle reflects these values and therefore they tend to be more vocal when it comes to influencing change in the food and beverage industry. They are prime targets for health and wellness trends that focus on socially conscious manufacturers.
Looking across these segments, you can see elements in Millennials’ attitudes, behaviors and consumer dynamics that are very different from the generations that have preceded them. At the same time, looking from segment to segment you can discern three groups of individuals who are very different from one another. To respond to differences among Millennials as a generation vs. older consumer targets, marketers must challenge everything we know to be true about product development and marketing to this audience. It is my hope that manufacturers and marketers will take the necessary steps to understand the Millennial audience on a deeper level, and to create distinct products and programs based on the varying emotional motivations and unique sub-segments of the Millennial audience. And please, start challenging anyone that says that they are “marketing to Millennials”.
If we’ve learned anything at all, it’s that this is not a one size fits all audience.
Laurie Klein is VP of Client Services at Forbes Consulting Group, a division of Copernicus. She has over 20 years’ experience studying millennials from birth to adulthood. She is an expert in marketing to millennials especially in the CPG and food and beverage industries. Laurie can be reached at firstname.lastname@example.org. She is happy to share more information on MindSight® Emotional Discovery.