Perimeter shopping is the latest and greatest trend in the grocery game, particularly for millennials. Consumers are eating more fresh produce and meats, and companies that have traditionally dominated the interior of the grocery store are looking for new ways to meet shoppers’ desires. The pace with which this trend has increased is fast and formidable; in his article, “Changing consumer tastes forcing companies like General Mills to change—fast,” Mike Hughlett describes how one large company is reshaping its practices to meet the desire for all things fresh and natural. General Mills started by cutting gluten and artificial colors and flavors from their cereals, but is this alone enough of a change? Will the introduction of several new Nature Valley products—that skew toward health—and a 25% sugar reduction from Yoplait be sufficient to re-capture the millennial?
This is a challenge because the millennial shopper has different food values than previous generations—47% of older millennials don’t trust large food manufacturers—and they rely heavily on the internet to inform their choices. Due to the unlimited accessibility to information, smaller brands, such as Chobani and Kind, have been able to reach out to consumers and build brand awareness without having to fork over funds for TV ad space. In response, General Mills has poured 25% of its media budget into online marketing and has continued expanding its organic and natural sales. The purchase of Annie’s last year was another move to stay relevant and appeal to the more natural/organic category. Pressure to do well throughout this changing demand comes from multiple sources, one being the presence of 3G Capital, which could be eyeing General Mills as a potential target.
Large companies have always faced the challenge of meeting new demands and trends of consumers. Due to the switching preference in grocery geography, General Mills (among other large food manufacturers) is faced with the task of keeping their products relevant and desirable to consumers. The best way to do this is through consumer-based research. What product changes/new product introductions will resonate with consumers and why? Who are these consumers and what appeals to them? In-store, in-context research is an on-point way to observe and interact with these shoppers to see what is working and what is not. As millennials become a larger part of the consumer spending base, companies will need to adjust their traditional viewpoints to point towards the up-and-coming generations. Moving forward, these questions will be essential for companies to answer, and the answers are possible with quality and experienced researchers.
-Sierra Dooley, Research Assistant
Edited By: Sarah Morrison