Retail

Supermarkets Not Scanning Well With Millennials

Despite the National Retail Federation reporting that grocery stores topped the “hot list” of retailers for the year, supermarkets are having a tricky time luring millennials into bringing a basket or cart down the aisles.

This could signal a shift that will permanently leave grocery stores in the lurch as eCommerce ramps up further.

Gone are the days when baby boomers bring lists to their local supermarket. That’s being replaced with millennials popping into these stores infrequently, due to increased availability of shopping for groceries online or through an app on their phone. They’re also spreading purchases across a variety of options — from Walmart, to Target, to Trader Joe's and other options.

Amazon perked up and took notice awhile ago with AmazonFresh. The tech giant wants to build brick-and-mortar stores that will sell perishable items, including milk, produce and meats. Potentially using a mobile device or a touchscreen located inside the store, customers can also order goods with longer shelf lives and get them delivered to their home on the same day. Amazon will also roll out drive-in locations, where customers’ online grocery orders will be delivered to their car.

In fact, staffing for AmazonFresh is already in the works. Taking the lead on the Amazon grocery initiative are longtime Amazonians Ben Hartman and Steve Kessel.

Federal data lays out that the average millennial spends around $3,600 on groceries, which is about $1,000 less than that age range did in 1990. Yes, inflation is taken into account with those numbers. Taking out the age group component, the average consumer bought $4,015 in food for their homes in 2015.

Experts say the choice to delay marriage and build a family does play into the mix. When those two things happen, typically, there’s a correlation with making more trips to the grocery store.

But experts also took notice that baby boomers are also not swinging by the grocery stores as much. And on top of that, this age group tends more to look for coupons, workaround sales and frequent discount retailers.

As a result of this grocery shift, some supermarkets are having to merge or close. Walmart, for example, closed more than 150 stores this year.

But people do need to eat, and they do need groceries.

Take a look at the choices of apps to get your groceries delivered, and it’s overwhelming in terms of options. Instacart, Shipt, UberRUSH, Stressy, mShoppee, Google Express, Peapod, FreshDirect and, of course, Amazon Prime, which is trying to get students addicted to the service for the rest of their lives.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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