Brand authenticity quintessential to Gen Z shoppers, IRI says
Authenticity is more important to Gen Z than preceding generations, according to findings from two recent studies the shopping attitudes and behaviors of this up and coming demographic from IRI and the Family Room. Findings also show that Gen Z shoppers tend to have significant influence on the purchase behaviors of their household — meaning that manufacturers and retailers are smart to adjust their marketing strategies now to win the hearts and minds of the latest generation to wield buying power before it’s too late.
“Gen Z is deeply motivated by authenticity and a brand’s ’emotional DNA,’ which we define as how completely a product or brand aligns with the values shoppers attribute to it,” Robert Tomei, president of Consumer and Shopper Marketing and Core Content Services for IRI, said. “Because Gen Z shoppers rely more on brand recognition to make purchase decisions than their millennial counterparts, it is critical that manufacturers and retailers create transparent and authentic relationships with the Gen Z population early on to build loyalty as their purchasing power grows.”
The research from IRI’s latest study, which builds on the initial Gen Z analysis released in September 2017, links the unique attitudes and behaviors of Gen Z to household purchase behavior data, providing CPG manufacturers and retailers with actionable insights that identify growth opportunities.
In addition to the importance of authenticity, some highlights from the study include:
- Gen Zers are active participants in their family’s grocery shopping. IRI’s study found that 47% of older Gen Zers (aged 18-21) participate in their household’s grocery shopping. Further, parents say their Gen Z kids influence what they buy at the grocery store;
- Personalization isn’t creepy — it’s cool. 38% of Gen Z kids think it’s cool to get ads or promotions in their social media feeds for products based on their interests/shopping habits. That’s much higher than their millennial counterparts, 21% for young millennials (aged 22-30) and 30% for older millennials (aged 31-40). And for younger Gen Z kids, personalization is seen as a great way to discover new products/services (42% of young Gen Zers agreed with this statement);
- Variety is a must. IRI’s study found that product variety (i.e., flavors) is very important to the Gen Z’s cohort that substantially influences the buying behaviors of their households. The number of unique UPCs purchased in households with Gen Z kids are significantly higher than those without. For example, in the cold cereal category, Gen Z households purchased 12.4 unique UPCs per household in the category compared with only 7.6 unique UPCs purchased by households without a Gen Z member;
- A healthy lifestyle is broadly defined. 66% of the Gen Z population said that “Feeling Good About Who I Am” is a part of being healthy, and 62% cited “Staying Positive” as a major contributor to health. These responses underscore the values-based, holistic approach Gen Z brings to all of their interactions, including those with brands;
- They want to be a part of the feedback loop. IRI’s and the Family Room’s findings show that Gen Z has little interest in or patience for brands that try to “sell them” without sincerely working to get to know them. They want to be an active part of the brand relationship and want a feedback loop and an interactive dialog — underscoring social media’s importance in both reaching and engaging with them.
“Gen Z is fueled by possibility,” Lynne Gillis, principal of Survey and Segmentation for IRI, said. “They see windows where others see walls. They are not afraid to create those things that they want but cannot find — they truly do want to be a part of the innovation process. But they want purposeful, collaborative innovation. If new products or services are not highly aligned with their specific needs and values and don’t fulfill a meaningful purpose, they’re quick to dismiss them. To accomplish this and reach them, manufacturers and retailers must leverage the power of personalization to reach Gen Z, the first generation that has no memory of life before the internet and the first majority minority cohort (‘diversity is natural’) in U.S. history.”
Coca-Cola to revamp Fresca
Coca-Cola is plotting to bring back the no-calorie soft drink, Fresca. The Atlanta-based company announced in a blog post that the seemingly forgotten beverage will be unveiling a new look that reflects its unique citrus flavor, with an end goal of bringing in a new generation of consumers who may not be familiar with the brand.
“Fresca hasn’t said anything to consumers since 2008, and our awareness with younger consumers is very low,” Ryan Hughes, associate brand manager of Sprite and Citrus Brands, said. “We felt it was time for a refresh after about a decade of silence.”
Revamped packaging for Fresca’s three flavors — original, citrus and black cherry citrus and peach — will be unveiled with an artisanal look.
“We realized we’re sitting on a potential goldmine,” Hughes said. “Fresca is a magical brand that, when once people taste and experience, fall in love with. It hits the sweet spot somewhere between a soda and a flavored sparkling water.”
Point-of-sale advertising and targeted sampling in millennial hotspots such as co-working spaces and college campuses will be launched in order to bring awareness to both the brand and its offerings.
“We want people, first and foremost, to enjoy the essence of Fresca — its refreshing, premium taste — which can’t truly be described until experienced first-hand,” Hughes said.
Center store remains ‘vital driver’ of store trips, Catalina reports
Center store remains a vital driver of trips and volume for grocery retailers, Catalina shared in a new survey published Wednesday. More than 80% of all baskets contain a center store purchase, the St. Petersburg, Fla.-based shopper intelligence firm stated.
“The Center Store is alive and well,” Marta Cyhan, head of marketing for Catalina, said. “Some 8-in-10 baskets we looked at included a center store item, but many consumers are looking to discover something different. A new generation of brands and subcategories are reinvigorating the center store by appealing to lifestyle and ingredient-based preferences.”
Specific cross-category consumer preferences like “heart healthy,” “low-fat,” “trans-fat avoiders” and “GMO avoiders” are fueling the growth of some of the fastest growing product subcategories, Catalina reported. Big winners include non-fat/low fat ice cream, value-priced entrée frozen dinners, sparkling/seltzer water, ready-made coffee drinks, window and glass cleaners, fresh rolls, dried meat snacks, vinegar, value-priced bath tissue, and a variety of snack and candy subcategories.
According to the report, center store accounts for 60 annual trips per shopper, per store and shoppers spend on average $1,408 a year.
“Our study demonstrates that brands and retailers who can understand today’s shoppers based on their underlying motivations and meet their evolving needs with product innovation will be a growth engine for the center store,” Cyhan said. “The ability to engage the right shoppers based on ingredient-level targeting will help these brands efficiently grow their business.”