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The purchasing power of millennials and the state of the snack industry

4 min read


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Vegan Feast Catering)

As consumers across demographics become busier and look for more convenient options in the food and beverage space, it is no surprise that snacking accounts for an increasing number of eating occasions. In fact, the average consumer eats about 2.6 snacks per day, and 41% of consumers snack three or more times per day, according to Sally Lyons Wyatt, executive vice president and practice leader of snacks for IRI. Snacks are now available to consumers in their homes and on the go, restaurants are putting more small items on their menus and more than 40% of people consider snacks to be an important part of a healthy eating plan, she said during a recent webinar.

“It’s another indication that snacks are playing multiple roles for consumers,” she said.

One of the most profound trends in the snacking industry today is the role millennials will play in the continued growth of the category, a panel of experts said during the webinar.

According to Wyatt, the purchasing power of millennials is growing. Their spending power is expected to grow by about 70% over the next five years. Millennial consumers snack throughout the day, with 36% of younger millennials snacking more frequently and 32% of older millennials bringing meals and snacks to work and school more often, she said. Millennial consumers are specifically driving growth in the organic snacks category, she added, and more than half of millennials look for customer reviews before making purchases, while more than a third use social media to interact with companies.

“We can’t beat you over the head enough with millennials,” said Sandy Krueger, executive vice president and practice leader of bakery for IRI. “With changing consumers come opportunities.”

One of the major opportunities in the snacking category is bakery, the panel said. According to Krueger, baker aisle sales have been steadily increasing over the past few years, and bakery sales are helping to bolster sales in the food and beverage space, overall.

“As a result, retailers are dedicating more space to the category,” she said. “Millennials are choosing bakery aisle brands that match their needs and beliefs.”

A major part of appealing to millennial consumers in the bakery aisle, Krueger said, is to get to know how they connect to your category. For example, bakery products that focus on fresh and easy would resonate with the demographic, she said.

“Make sure you’re targeting them in a way that makes sense to them,” Krueger said.

One way millennials are shaking up the bakery aisle is their interest in some non-traditional forms of products like bread, she said, as millennials tend to prefer tortillas, wraps, pitas and flatbreads.

“Really understand how millennials and boomers engage with your product at home as well as away because that will allow you to be able to foster and broaden your relationship with these consumers,” Wyatt said.

Other than the growing importance of the millennial demographic, other major issues at the top of snack industry members’ minds include the new nutrition facts panel, sodium content and labeling, according to Tom Dempsey, president and CEO of the Snack Food Association.

“This is an issue we need continuity on,” he said of GMO-labeling.

In the bakery space specifically, government regulations and consumer habits and tastes are the two biggest issue right now, American Bakers Association President and CEO Robb MacKie said.

As for emerging trends in the snack industry, Wyatt said to be on the lookout for plant-based proteins, fair trade claims, ancient and sprouted grains, “premium-tized” organics, vegan, natural chocolate candies and raw chocolate. At the end of the day, identifying these growth opportunities and capturing them is the important thing, she said.

“You really want to understand consumers’ attitudes and behaviors and make sure you get the right targeted assortment, price and communication,” Wyatt said.


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