Technology, social media and online shopping is changing the dynamics of consumerism. As a result, Canadians are changing how they interact with businesses and seeking information about products before they purchase them. These days, they’re reading peer reviews and becoming educated about how, when and why they should spend money. This change is influencing consumers across age cohorts, but it’s particularly influencing millennials.
Today’s millennials — people between the ages of 16 and 34 — have grown up during a technological revolution that has dramatically affected their shopping behaviour. Not surprisingly, the group is brand savvy, brand loyal, and it has been introduced to shopping, as well as dining out of home, at a much earlier age than generations before. A cohort of 12-million strong in Canada, the group spent $13.3 billion at restaurants across the country in 2012, according to NPD CREST research.
The younger cohort represents varied opportunities for today’s savvy restaurateur. Already seasoned customers, millennials are the most educated restaurant consumers in Canada. Heavy users of online tools, such as web and mobile applications, millennials have contributed to the NPD CREST research statistic that digital marketing is responsible for driving 33 per cent of a restaurant’s new customers. This triples the number of new visits resulting from other forms of marketing (10 per cent). It should also be no surprise that, compared to the general population, millennials are much more influenced by recommendations as well as commercial/ad campaigns. As educated consumers, NPD’s CREST research also reveals that millennials represent the largest group of restaurant consumers who choose a restaurant based on “healthy choices” and its ability to support “green/sustainable initiatives.”
Dining out of home, millennials favour three segments of the restaurant marketplace. The quick-service restaurant segment is popular for the age group, representing more than 68 per cent of their restaurants occasions. Full-service restaurants are the second choice, representing 20 per cent of occasions, and prepared food from retail environments such as convenience stores or home-meal replacement (HMR) at grocery stores, is third on the list (12 per cent). The majority of millennials’ restaurant occasions occur during the snacking dayparts (34 per cent). Lunch is the next most popular daypart followed by the morning meal.
To survive and grow, successful restaurateurs should adapt and change their market strategies to benefit from the opportunity these young, educated consumers provide. Targeting millennials will require using language, marketing, menu innovation and diverse communication tactics that relate to this cohort. Restaurateurs who focus on reaching the millennial generation, by building their trust and gaining loyalty, can realize immediate business growth today as well as in the future.