Millennials Spend More on Prepared Foods Than Other Generations, Study Finds

A new ERS study analyzed a recent year of grocery store data to see how Millennial purchases differ from those of older shoppers. Millennial households—at all income levels—devote more of their at-home food spending to prepared foods than the other three generations.

Millennials, those born between 1981 and the mid-2000s, are now the largest living generation—surpassing Baby Boomers—in the United States. Their purchasing behavior greatly influences the current retail landscape, as companies try to accommodate Millennial preferences. Studies have found that Millennials are distinctly different from older generations in that they are more racially diverse, more highly educated, and more internet savvy. Most are early in their working lives and single or just starting their own families. Their grocery shopping habits are likely to change as they age, but current differences from older generations could have implications for future food demand.

Also read, U.S. millennials prefer QSRs and coffee, according to new fast food poll.

Are the food shopping habits of Millennials different from other generations? A new ERS study analyzed a recent year of grocery store data to see how Millennial purchases differ from those of older shoppers. The study found that Millennials, on average, devote less of their food budgets to grocery store (food at home) purchases and make fewer trips to the grocery store than the other generations examined. Millennials are demanding healthier and fresher food—including fruits and vegetables—when making food-at-home purchases, and they place a higher preference on convenience than do other generations.

Millennials Purchase More Prepared Foods
ERS researchers classified the IRI purchase data into 3 beverage categories and 19 food categories—13 fresh or minimally processed categories and 6 processed categories. Processed food categories included bakery items (breads, rolls, and cakes), sugar and candies, baby food, snack items, prepared foods, and other foods (condiments, seasonings, sauces, etc.). Snack items are foods not consumed as the main part of a meal, such as chips and crackers. The researchers defined prepared foods as foods that require no preparation after purchase—the food is ready to eat or ready to heat and then eat. Examples include canned soup, frozen pizza, and items from the deli section, such as sandwiches, pasta salads, and rotisserie chicken. Once separated into categories, the researchers calculated monthly expenditure shares by category and household type.

Millennial shoppers generally purchase a larger share of prepared foods, pasta, and sugar and candies than the other generations. On average, Millennials devoted 13.6 percent of their at-home food expenditures to these three categories, compared with 12.4 percent by Gen X’ers, 11.5 percent by Baby Boomers, and 11.2 percent by Traditionalists. Millennial households also devote the smallest share of their at-home food expenditures to grains, poultry, and red meat. Prepared foods, sugar and candies, and pasta all require minimal preparation for consumption, while grains and meats require cooking.

Examining at-home expenditure shares by income, some noticeable patterns appear. As income rises, expenditure shares for vegetables, fruits, red meats, and sugar and candies for all four generational groups increase, while shares for poultry decrease as incomes rise. Poorer Millennials assign lower shares of at-home food spending to vegetables than poorer Traditionalists and Baby Boomers, but they increasingly apportion more of their food budgets to vegetables as income rises, surpassing Traditionalists when per capita household income reaches about $30,000. Specifically, the wealthiest Millennial households (per capita income greater than $100,000) dedicated 8.1 percent of their food budgets to vegetables, compared to around 6 percent for the other generation groups in the same income decile. The share of at-home expenditures for fruit was similar for Millennials and Traditionalists—just over 6 percent—with fruit’s share of expenditures also rising with income.

Millennial households generally allot the lowest shares of their at-home food budgets to red meats and poultry. On average, expenditure shares for red meats and poultry decrease with each younger generation. For each of the generations, higher income deciles generally devote a larger share of at-home food expenditures to red meats and a smaller share to poultry.

Like purchases of poultry, grain and pasta purchases exhibit a negative relationship with income; as households become richer, they buy less grains, which are often shelf stable and cheaper, and shift toward purchasing more perishable foods like red meats and fresh fruits and vegetables.

Millennial households devote more of their at-home food spending to prepared foods, such as frozen entrees and instant breakfasts, than the other three generational groups. In addition, the slight negative relationship between income and prepared food purchases for the three oldest generations was absent for Millennials. Millennials’ preference for convenient, prepared foods could be due to a variety of reasons. Perhaps, some Millennials may lack cooking skills or interest in cooking. Or, maybe some Millennials prefer to spend their non-work time on activities other than cooking and cleaning up afterwards. In fact, Millennials spend significantly less time on food preparation, presentation, and clean-up. An ERS analysis of 2014 time use data revealed that, on average, this generation spent 88 minutes doing food preparation, presentation, and clean-up—55 minutes less than Gen X’ers who spent the most time at 143 minutes.

Analysis of food-at-home purchases is important since what we eat can affect our health. The food purchasing behavior of Millennials determines their own dietary quality and may shape the eating habits of their children and future generations. Grocery store shopping behaviors, however, are not necessarily fixed and may shift for Millennials with age and life events, such as marriage and children. Millennials could find themselves saying good-bye to a frozen dinner for one and hello to a home-prepared spaghetti dinner for four.

See the full report HERE.

SOURCE USDA (United States Department of Agriculture)