If you’ve been keeping up with our blog posts you’ve probably read what we had to say about millennial food trends in “Our Most Anticipated 2020 Food Trends List.” But what about Gen Z, the so-called digital generation? Born after 1997, research shows that this group will be responsible for up to 40 percent of consumer spending in 2020 (1). In fact, they will be making up more than one-third of the population at some time this year, surpassing both millennials and baby boomers as the largest generation (1).
While Gen Z’s tastes and preferences are often lumped together with those of the millennials, there is no doubt that this generation wants food to reflect their values and innovations of recent times. Gen Z, according to Chicago-based research and consulting firm Technomic Inc, is a generation “on the move that strongly prioritizes speed of service, technology, and having what they want, when they want it” (2). While this is a gross generalization, it is important to note that Gen Z’s priorities as a whole will be setting the trends of the restaurant industry. As Marcie Merriman, a cultural strategist at professional services and accounting firm Ernst & Young says, “The youth within our society have always been the drivers of change and trends. Five years ago, that just happened to be a millennial because that was the generation that was at that point. Now we have Gen Z. … If you can meet their needs, then you’re going to please everybody else” (3).
If you’re not convinced yet, just consider their estimated spending power. It’s been found, that on average, Gen Z spends $1 out of 5 on food, and $29 billion overall (4). That’s why it’s not too early to start marketing to this young audience. Here are some ideas to get started:
Make it convenient
Gen Z diners are going to use phones as part of their dining experience. Because their reliance on technology is stronger than those of the previous generations, we expect there’s going to be more customers digitally splitting checks, previewing the menu on Google, and posting online reviews in real-time (5).
Integration with technology is going to be the key to attracting this generation. Having a solid digital presence and active social media accounts should be your priorities. At the very least, we recommend that you upload your business information and menu on Google and Facebook so that your customers to find you online. It is not uncommon for Gen Z diners to decide to eat at a restaurant solely based on their social media accounts (6).
Other ways to increase convenience in your business are increasing delivery options, allowing online reservations via app, and allowing customers to pay by mobile app. The more convenient it is for Gen Z customers to order food from your restaurant the more likely you will bring in Gen Z customers as well as keep them. “The more knowledge you can give these guests ahead of time, the more it will help with your throughput” (7).
Be open to change and innovation
Generation Z is a generation that has grown up in a multicultural world, and thus around global cuisines. According to research by Mintel, a London-based market research firm, Gen Z consumers are driving the consumption of more emerging international food and drink (8). Research even shows that 36% of US parents of children under age 18 agree that their kids enjoy eating international foods (8). With exposure to international foods starting at an early age, Gen Z diners are more likely to break from tradition and more willing to explore foods however bizarre; they desire gastronomic experiences on top of food that looks and tastes good (3). This is even reflected in the way they shop: according to management consultancy Accenture, less than 38 percent of Gen Z customers frequent a single grocery store, compared with 55 percent of older millennials (9). According to Merriman, Gen Z is “a generation where things have constantly changed around them” (3). She also added that “They’re constantly looking for something different and new and fresh. For these restaurant brands and chains to continue to win them, they’ve got to constantly be giving them something different.”
Be Social. Engage. Offer connections
According to Michelle Tempesta, the head of marketing at Paytronix Systems, Inc, guest engagement programs could be key to winning over Gen Z (1). A well-executed loyalty program has many benefits, as it helps to understand their guests and engage with them on a one-to-one level. It also enables discounts and other promotions that will motivate customers from Gen Z to return to your business.
Tempesta also added that Gen Z wants to feel special (1). One article in the Society for Human Resource Management addressed a slightly different need—to feel connected—as a Gen Z trait (10). That said, engagement is going to be important to Gen Z consumers who rely heavily on social media. Restaurants would benefit from posting daily, offering giveaways and contests. If done well, social media would prove to be an effective marketing strategy, one that will boost the number of customers that post reviews online. Research by Harvard Business School showed that a one-star increase in a restaurant’s Yelp rating can result in as much as a 9 percent increase in revenue (11).
Be authentic, and build a good brand image
Generation Z customers are looking for food that fits in with their values. According to Technomic Inc.’s Generation Consumer Trend Report, menu words such as locally sourced, sustainable, farm-raised, organic, and free-range have greatly appealed to Gen Z diners (12). Other values that seemed to resonate with this generation are transparency as well as social responsibility. Unlike previous generation diners, Gen Z diners are more invested in not only what they eat but how they are produced. According to a report by the NPD Group, Gen Z places a different perspective on the “value” of food (13). As written in the report, “this generational cohort has set expectations that food and food brands will follow their needs and not the other way around” (13).
As Susie Fogelson, Founder and CEO of Fogelson & Co. said, “The findings suggest ways for food, beverage, hospitality and dining brands to rethink their storytelling strategy” (14). One way to connect with these young consumers may be to first recognize their values, go to the digital platforms they frequent, and then engage them at a personal level.
However, we recommend that you balance engagement with authenticity. According to Desiree Le, cofounder of California-based Cauldron Ice Cream, “If you’re trying to lie to them or thinking about tricking them … they’ll call you out on it right away because they have so much information available to them. They’re loyal if you are honest with them, but in a second they can go to anyone else” (3).
Likewise, “Gen Z just wants you to be honest,” wrote Donald Burns for Foodable Network (15). “That means have strong values that they will identify with. So, know who you are and be authentic about it.”
Conclusion
There is no question that the Generation Z as a whole will leave an indelible mark in the food and dining industry. Marketing to this generation will require change, innovation and technological investments, sure, but these changes will ultimately provide opportunities for your business to grow and adapt to the group of consumers that will soon reign as the majority. It’s as Fogelson says, “Gen Z is really having a lot of fun with food” (14).
So maybe we should, too.
Reference
- https://www.qsrmagazine.com/outside-insights/how-restaurants-can-identify-and-engage-generation-z.
- https://www.technomic.com/newsroom/technomics-consumer-4sight-group-takes-deep-dive-gen-z-foodservice-usage
- https://www.qsrmagazine.com/reports/how-win-gen-z-restaurant-business
- https://www.forbes.com/sites/aliciakelso/2019/05/06/gen-z-consumers-are-different-than-millennials-heres-what-that-means-for-restaurants/#55db939a477f
- https://www.qsrmagazine.com/outside-insights/why-now-time-restaurants-court-gen-z
- https://upserve.com/restaurant-insider/generation-z-new-food-trends/
- https://restaurant.org/Articles/Operations/Ready-for-Gen-Z
- https://www.mintel.com/press-centre/food-and-drink/generation-z-set-to-impact-the-future-of-food-and-drink-innovation
- https://newsroom.accenture.com/news/generation-z-to-switch-the-majority-of-purchases-to-retailers-that-provide-the-newest-digital-tools-and-channels-accenture-research-reveals.htm
- https://www.shrm.org/hr-today/news/hr-magazine/1118/pages/a-16-year-old-explains-10-things-you-need-to-know-about-generation-z.aspx
- https://www.hbs.edu/faculty/Pages/item.aspx?num=41233
- https://www.technomic.com/available-studies/consumer-trend-reports/generational
- https://www.prweb.com/releases/2018/01/prweb15126038.htm
- https://www.foodabletv.com/blog/the-era-of-the-super-foodie-is-here
- https://www.foodabletv.com/blog/2018/5/3/what-will-it-take-to-win-over-generation-z-as-foodies
About Goliath Consulting Group
Goliath Consulting Group with headquarters in Norcross, Georgia offers a dynamic array of business development solutions, tailored to meet the needs of each individual client – in addition to a full suite of knowledge and tools that help make restaurants more profitable, including strategic planning, menu development, project management, new restaurant development, branding, marketing, franchising, equipment, technology, evaluations, outsourcing, and more. The company also has a management division that manages full-service restaurants. Goliath Consulting enjoys a ten-year track record of creating client success among local, regional and multi-unit national restaurant chains.
Goliath Consulting Group is actively involved in the Foodservice Consultants Society International and is an allied partner of the Georgia Restaurant Association.
Contact: getresults@goliathconsulting.com