Grocery gets higher share of millennial spend

Millennial spending habits are contributing to lower sales in many retail categories, but there is one where spending largely remains intact: grocery.

While the Great Recession changed a lot of shopping and saving habits, especially for younger shoppers, a new survey from Retale found that only 8 percent of shoppers age 18-34 are likely to cut spending on groceries.

Restaurants, apparel and general entertainment were bigger losers, with 36 percent saying they were eating out less, 30 percent are cutting entertainment budgets and 21 percent were buyer less clothing.

"Like most age groups, millennial consumers have felt the recession's impact," said Pat Dermody, president of Retale. "According to our data, to counteract it and save, they're dining out less and opting to eat at home more. This is why there hasn't been a sizable decline in grocery shopping, post-recession. Lost restaurant trips should ultimately benefit grocery retailers."

Value and low prices are still important to this group.

When asked to choose the three most likely factors in picking a grocery store, the top response was "lower costs or opportunities to save" (50 percent). "Availability of locally grown or organic products" (38 percent) was second, followed by convenience (34 percent).

When millennials were asked when they were "most likely" to go grocery shopping, practicality and cost were the top reasons.

Mobile is a top tool for this group, as 43 percent use a mobile device for clipping and browsing coupons; 58 percent said they use their mobile device while shopping.

Supermarkets are developing mobile apps, using proximity marketing and developing new formats such as 365 by Whole Foods Market.

For more:
- see this Retale report

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