Millennials looking for a deal from food service
It should come as a shock to no one that not all millennials are alike. The age range of the demographic is broad, which means many of the consumers within the segment are at different life stages. Older millennials, those between the ages of 25 to 34, for example, are more likely to have families than their younger counterparts. But there is one characteristic millennials have in common – they are not spending as much at food service as they once did, according to The NPD Group.
The market research company said that for U.S. restaurants and foods service outlets, millennials as a group represent about 14.5 billion visits and $96 billion in spending, which is 23% of total restaurant spend, but the group has reduced both visits and spending in the past few years.
Older millennials, ages 25 to 34, who are more likely to have families, have cut back the most on restaurant visits, making 50 fewer visits per person over the past several years, according to the NPD report, “Encouraging more visits from millennials.” Younger millennials, those who are 18 to 24, made 33 fewer visits per person.
Annual per capita restaurant spend for younger millennials is $1,240, which is down $146 per person compared to their spending in 2007, and older millennials’ annual per capita spend is $1,369, down $213 per person.
NPD found the reasons millennials are cutting back on visiting restaurants are varied, but first and foremost, is concern about the money they spend at food service, particularly millennial families with children. They indicate restaurants may be too expensive and that it’s cheaper to eat at home.
Millennials say that they are cooking at home more often as many “don’t at all mind to do so,” and about half claim to like to cook. In addition to saving money, they feel better about cooking at home because they consider it healthier and it tastes better than what they can get away-from-home.
“Even with their cutbacks millennials still make a lot of visits to restaurants and to encourage more visits, restaurant operators need to offer them a ‘good deal,’ which to millennials means reasonable and affordable items that are of good quality and the right quantity,” said Bonnie Riggs, NPD restaurant industry analyst. “In other words, they not only want to get their money’s worth, they want good food and service.”