They’re intelligent, they’re curious, and they’re savvy — they’re Generation Z, and they’ve got money to spend.
That’s according to FONA International, which recently released a report outlining the group’s characteristics and spending power.
The flavor firm noted young people ages 10-17 represent $44 billion in discretionary spending each year. And, citing data from Forbes, FONA says Generation Z is expected to become the largest group of consumers by 2020, with $143 billion of direct spending.
But what do we know about this group of young people and how they relate to the food industry?
Not shockingly, they’re well-informed, having “grown up in a digital age” and being fluent in social media. Gen Z is daring when it comes to trying new food and flavors, but overall, they’re more risk-averse, being less likely to experiment with drugs and alcohol.
“They wield strong opinions, wide influence and have inherited their parents’ interest in healthy eating,” FONA’s report reads. “Generation Z and teens in particular are already showcasing their adventurous palates, desire for functional food, and love of culinary self-expression.”
Gen Z shoppers also are concerned with food waste, packaging, Fairtrade, plant-based beef alternatives, sustainability and human labor. Transparent companies with authentic commitments to similar values are in a good position to be noticed by young consumers.
They’re also snackers, not unlike the Millennials preceding them. Citing a study by Farm Rich, kids and teens eat 2-3 snacks a day, with chips, fruit, pizza and frozen snacks being their favorites. Citing data from Mintel, FONA noted parents are more likely to spend money on snacks when shopping with their child.
Furthermore, FONA predicted the group’s diversity, individuality and openness to new things will make limited editions and customizable flavor combinations increasingly popular.
“Today’s teenagers have influence far beyond their often limited cash on hand,” the report reads. “Though young, this group is signaling some clear opinions and passions for the future. The food and beverage industry would be wise to take note.”
Take note, indeed. As these young people enter the workforce, their influence as consumers is only going to grow. Like Millennials, they want manufacturers to offer product diversity and transparency, along with a strong digital presence, but Gen Z can’t be lumped in with their predecessors.
As a group with increasing purchase power, manufacturers need to be ready to meet them head on.