America’s twenty-somethings, known as the Millennial generation or generation Y, are connected, confident, and tend to live in the moment when it comes to making food choices, reports The NPD Group, a leading market research company. According to recent NPD food market research, Millennials are more likely to say their food choices at main meals are motivated by cravings, cost control, and minimal preparation time.

According to NPD’s National Eating Trends, which has continually tracked America’s eating behaviors for 30 years, Millennials’ food selections indicate a here-today-gone tomorrow mentality. They are much more likely than consumers in other age groups to use frozen entrees or other food items that are portable and do not require preparation. As with most of these food offerings, there is usually little opportunity for leftovers, which correlates to their relatively low rate of leftover usage.  “National Eating Trends” reports that a typical Millennial has 68 meals a year that contain a leftover item, but adults in their 30s to early 40s are using leftovers in 82 meals a year.

In addition to convenience, cost control is a major motivation for Millennials, and frozen food and other convenience-oriented food products often provide relatively inexpensive meal solutions.

“Cost concern is particularly important to this age group since they have been among the hardest hit by the recession,” says Darren Seifer, food and beverage industry analyst for The NPD Group. “The unemployment rate for adults under 30 was 19.5% for the second quarter of 2010, a rate more than double the 9.5% seen for the total workforce.”

Millennials are coping with their economic challenges by making use of low-priced retailers.  “National Eating Trends” finds that one-third of Millennials use mass merchants, such as Walmart, as their primary food store, compared to 23% for all adults.

“The Millennial generation has grown up in a time of tremendous technological advances, coupled with new societal norms,” says Seifer. “They are connected like no other generation before them. This connectedness is both an opportunity and challenge for marketers. Communicating with – and selling to – Millennials requires an understanding of their attitudes and behaviors.”

[Source:  "National Eating Trends."  The NPD Group. 11 Aug. 2010.  Web.  25 Aug. 2010.]

Consumers may not exactly be crowding into restaurants these days. But some industry operators are looking to expand the breakfast day part in order to boost the bottom line.  Scarborough Research recently published a study on this topic that reveals some surprising information about who eats breakfast at quick-serve establishments and which forms of advertising really reach this crowd.

According to the data, 37%  consumers have stopped by a quick-serve restaurant for breakfast in the past 30 days. The budget-friendly menu definitely draws Generation Y (ages 18-24). But who knew that consumers with college degrees and household incomes exceeding $100,000 are also frequent purchasers of donuts, coffee and perhaps something more substantial like eggs and bacon.  Scarborough analysts note that specific geographic regions also have a high visit rate for quick-serve breakfasts and link the trend to a concentration of single adults.

To capture this business, operators are using a variety of advertising strategies. Alisa Joseph, vice president of advertiser marketing services, Scarborough Research says “These major restaurant chains have always understood the importance of localism and continue to adapt their marketing, menu options and promotional efforts to suit the distinctions of the locals.”

One ad strategy will be to increase the number of digital coupons available to promote new offerings.  And this strategy is well-positioned. Adults who eat breakfast at quick-serve restaurants exhibit the following tendencies:

• Spend 20+ hours a week online (18% more likely than average)
• Download online coupons (22% more likely than average)
• Receive coupons via e-mail or text message (29% more likely than average)

Quick-serve operators are also attempting to enhance their environment to attract the tech-savvy crowd. McDonald’s has been offering free WIFI for some time now and Starbucks recently stopped charged for WIFI access. As the economy recovers and more consumers drop by their local quick-serve restaurants for breakfast, additional competition may prompt increased marketing.

[Source: McDonald's Dominates in the Breakfast Wars. ScarboroughResearch.com. 11 Aug. 2010. Web. 23 Aug. 2010]

Earlier this week, I blogged on reports of food marketers who are trying to increase demand from kids for healthier foods, mainly produce. Food marketers are also having success selling other healthy products to consumers. Recently published reports indicate that consumers are increasing their purchases of whole grain products, especially pasta and bread.

A Supermarket Guru report cited Nielsen data that shows consumers cut back on their purchases of branded dry pasta. At the same time, sales of whole grain pastas have jumped. Consider these sales increases over the past few years in this category:

• 2007 46%
• 2008 31.6%
• 2009 17.5%
• 2010 11.4%

Consumers seem to be selecting healthier options in the bread aisle as well. Total dollar sales for fresh bread reached $6.490 billion this year. This level is a 2.8% drop from last year but the news is good for wheat bread. The details show that the fresh white bread category achieved $1.9 billion in sales, a 6.6% drop from 2009. But fresh wheat bread is now valued at $1.99 billion in sales, a 0.8% increase from last year. On a dollar volume level, it appears that wheat and white bread have a similar market size. However, on a unit volume basis, while white bread has the larger market, it is also shrinking. These numbers suggest that wheat bread, while more expensive, is appealing to a larger segment of the consumer base.

Food marketers are clearly making progress in promoting their products based on features such as healthy ingredients instead of just price.

[Source: Pasat’s Split Identity: Whole Grains Healthier. Supermarketguru.com. 6 Aug. 2010. Web. 18 Aug. 2010;  Wheat bread sales surpass white for first time. July 2010. Web. 16 Aug. 2010]

Ad-ology Research recently updated their Industry Marketing Insights report for Butcher Shops. The following are the predicted Top 3 Opportunities/Challenges from the report for this industry for the upcoming 12 months:

• Consumer interest in sourcing local products has been extending to butcher shops. Though this is still a niche industry, butchers are reporting seeing more consumers who want to know exactly where their meat is coming from.
• Butchers are having difficulty obtaining quality meats because of the lack of local slaughterhouses around the country. The centralization of meat processing in the U.S. forced many slaughterhouses to close. There is some interest in opening new and mobile slaughterhouses to meet demand, especially from small local farmers and butchers. But many consumers do not want these businesses in their towns.
• Demand for goat meat is expected to increase as the ethnic populations from the Middle East, Caribbean and Indian communities rise across the country. Butchers may market to these demographic groups.

The Industry Marketing Insights report for Butcher Shops is available on Ad-ology.com (Research Store) for $195 USD with local market data for any U.S. market.

[Source: Ad-ology Research. July 23, 2010]