Millennials Leading the Way in Emerging Food Trends

May 11, 2015
As generations shift, so does the definition of 'good for you' and what it means to consumers and to the food and beverage industry.

Indra Nooyi, the CEO of PepsiCo, was recently quoted as saying, “we have never seen food consumers as confused as they are today.” From PepsiCo’s perspective, that may be true, but the steady shifts in consumer preferences make good sense and are explainable.

PepsiCo currently controls over $66 billion in food and beverage sales, so trying to manage through even subtle shifts in consumers’ demands can be very tricky. But I am not sure if today’s consumers are as confused as Ms. Nooyi believes they are. 

Anyone in the food industry, or who follows consumer shopping/eating trends, knows there has been a monumental shift towards good-for-you foods. But, as Ms. Nooyi admits, “PepsiCo is being challenged to really think about what is the definition of 'good for you' from a consumer perspective. This is unprecedented, and the definition of ‘good for you’ is being challenged right now.”  Older shoppers have tended to view lower calorie and fat content (especially saturated fat), with less sodium or added sugars, as being big drivers towards their definition of good-for-you. As Ms. Nooyi further explains, “[Consumers] are willing to consume organic or non-GMO products even if it has high salt, sugar or fat content.” While we agree this diverges from prior behavior and there are evolving definitions of what ingredients constitute a good-for-you product, overall market trends become clearer every day. 


One generation having a particularly meaningful impact on consumer behavior is the millennials, and, notwithstanding the fact they may have an untraditional view of what a good-for-you product can be, they seem to know exactly what they want. According to Mintel, 42 percent of millennial shoppers perceive private label store brands as more innovative than branded products. Conversely, older shoppers are more likely to consider store brands of lower quality and consistency. Every CEO and marketing professional wants to know what the millennials are doing, thinking and buying. With the explosion of social media, millennials’ preferences and views are quite transparent if we look hard enough, and their digital influence can’t be denied. 

So what are millennials looking for? A few things are obvious, including clean labels with easy-to-read ingredients and product claims. They prefer no artificial additives and have a preference for functional packaging that is easy to open or re-sealable. Mintel goes on to report that 97 percent of millennials are likely to buy store brands and “store brand shoppers are gravitating towards products that list ingredients they recognize, and feature prominent claims such as organic, low/no/reduced or made with natural ingredients.”

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The other big difference in millennials is in the way they eat, preferring smaller portions and meal replacements to three big meals a day, the way baby boomers were conditioned to eat.  As Susan Viamari, editor of Thought Leadership for IRI states, “consumers can’t get enough of that protein filled, on-the-go snack and meal time replacement.”  Needless to say, the active lifestyles that the millennials and Gen-Xers live support this powerful trend. One product category that everyone seems to agree on is yogurt. According to IRI’s list of 2014 New Product Pacesetters, which ranks the best performing new products based on one year of sales, four yogurt products, including Chobani Simply 100, Activia Greek, Chobani Flip and Yoplait Greek Blended, finished in the top 10. Of course, these new products follow several years of robust growth in an age-old category that has been revitalized. Once again, the younger generations are at the forefront of this growth, but are clearly influencing older generations as well.

CEOs are taking notice of these evolving consumer preferences. Campbell’s announced innovations in packaged fresh categories as well as the launch of more than 200 new products in FY 2015 in several good-for-you categories, including organic and on-the-go nutrition. While they have not specifically articulated their thoughts on which generations have been driving these trends, there is little confusion about what the trends are. Moreover, there is certainly enough evidence out there to credit the inertia behind these changes in behavior to the younger generations, and their powerful preferences are permeating through to older generations. So is the consumer really that confused afterall?

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