By Denise Purcell

Coming of age with the Food Network, Starbucks and the Internet, twenty-somethings are being billed as the most food-savvy generation yet—poised to be the largest consumer superpower since the Baby Boomers.

Specialty retailers who discount this age group as being on the periphery of their traditional clientele are missing out. Twenty-somethings’ sophisticated, adventurous spirit already draws them to some specialty categories such as snacks, treats and ethnic foods. Furthering their knowledge of a wider range of products could grow purchases from indulgences to ingredients, allowing merchants to develop this lucrative demographic.

40 Million Strong
The over-45 age group has traditionally been viewed as the quintessential target consumers for specialty foods due to its size and high income level. However, recent research such as Specialty Food Magazine’s Today’s Specialty Food Consumer 2005 reveals that the typical specialty food shopper is skewing younger overall. According to the research, shoppers aged 25 to 44 are the most likely to purchase specialty foods.

The twenty-something (sometimes called Generation Y in marketing-speak) generation’s magnitude gives it staggering market potential. The young adult segment, defined as 15- to 34-year-olds, is currently composed of 79 million people, explains David Morrison, president of TWENTYSOMETHING™ INC., a consulting and marketing research firm in Radnor, Pa. (To add perspective, the Baby Boomer market is now 77 million strong.) There are an estimated 43 million 18- to 28-year-olds in the U.S., a group that is growing nearly twice as fast as the general population.

This segment has economic power unheard of among prior generations: It is estimated that they spend upwards of $150 billion annually on consumer goods.

Experience and Experimentation
Young adults are neither intimidated by food nor hesitant to spend money on it. This age group has enjoyed travel opportunities, frequents restaurants regularly and is accustomed to everyday luxuries such as a $4 latte. “GenYers will have the most dramatic impact on the food industry,” notes Elizabeth Sloan, president of California’s Sloan Trends and Solutions, in a recent Food Technology article. “They are the most culinary-aware generation in history.”

Twenty-somethings are an experiential—and experimental—group. Likely to have been raised in ethnically diverse environments—with one in four a non-Caucasian, according to U.S. Census figures—the segment possesses a sense of adventure and interest in other cultures evident in their food purchasing choices. Internet access also has played a major role in molding the generation’s view of the world. Web-savvy twenty-somethings share a “global village” mindset, notes Morrison. “This market views the world as its personal playground,” he continues—a notion that compels them to seek out what is new and exciting.

That drive draws them to exotic and ethnic foods. According to Packaged Facts, Chinese, Mexican, Japanese, Italian and Indian top their list of favorite cuisines. The group is currently trending toward Latin American foods, specifically Cuban or Peruvian fare, in demand because of the influence of the Hispanic culture. Sushi, on the other hand, is largely considered “sooo 1980s,” Morrison remarks.

While the generation is far from monolithic, key demographic segments, from college students to young professionals to older twenty-somethings starting families, are linked by a search for products that are innovative, high quality, healthful, tasty and fun. These desires are also reflected in their attitudes about wine. Twenty-somethings don’t respond to a staid approach, evidenced in the launch of magazines such as Wine X Magazine: Oenology for Twentysome-things, which dispels perceived wine snobbery with columns such as “Rage” and “Sex, Wine and Rock ’n Roll.”

Personal Treats, Cool Innovations
Specialty Food Magazine’s research shows that the typical specialty food shopper is affluent, earning more than $100,000 a year. Since younger age groups usually have yet to realize their income potential, less expensive items have an appeal. Twenty-somethings have a penchant for small luxuries. For example, shoppers aged 18-24 buy more chocolate than those aged 55-64, 67 percent versus 57 percent, respectively. Younger respondents are more likely than older adults to buy specialty foods as a personal, special treat.

Among everyday items, younger consumers seek out specialty beverages, including ever-popular teas and coffees, but also uncommon specialty sodas, such as classic Mexican soft drinks, says TWENTYSOMETHING’s Morrison. Candy, salty snacks and treats such as Italian gelato are also popular. Packaged products that reflect an air of coolness are fashionable, especially innovative packaging that satisfies the perpetual craving for new experiences. One example, notes Chuck Richards, owner of Charlotte, N.C.’s Reid’s Fine Foods, is the DUO Adjustable Oil and Vinegar Dispenser, featuring a rotating head that allows users to determine the exact ratio of olive oil to vinegar they desire.

Cooking 101
Twenty-somethings with larger discretionary incomes, such as two-career couples, experiment with a wider range of specialty foods—but don’t necessarily understand how to use them. When growing up, the generation’s regular patronizing of restaurants largely stemmed from dual working-parent households where cooking was infrequent. The culinary skill deficiencies among twenty-somethings require a steep learning curve for retailers to tackle.

Reid’s Fine Food’s Charlotte location is home to Wachovia and Bank of America headquarters, attracting many young professionals. To accommodate these patrons, Reid’s often “works 101.” Richards explains, “Our meat cutters, for instance, are trained to show them what to do with their purchase when they get home. We also help with menu planning for dinner parties.”

Reid’s provides practical solutions in its cooking classes, held in-store on alternating Saturdays. “We offer basic classes, such as how to shop the Farmers’ Market across the street,” Richards continues. Specialty food usage is included in in-class instruction to generate sales and familiarity. “We featured a Robert Rothschild Raspberry Salsa and gave the class suggestions, like pouring it over cream cheese for hors d’oeuvres or using it in meatloaf. Then, we gave a 10 percent discount on it in-store the day of the class,” he adds.

Like all age groups combating long work hours, Reid’s clientele is drawn to products that enable them to assemble a meal rather than cook one from scratch. Flavored olive oils or jarred finishing sauces are in demand.

Ready-to-go foods are also a huge draw. “The group buys more prepared foods than raw product to cook, maybe because of time constraints or lack of ability,” says Sam Mogannam, owner of Bi-Rite Market, located in San Francisco’s edgy Mission District where twenty-somethings are a significant factor.

Lisa Santos, owner of Southport Grocery and Café, also notices young adults leaning toward ready-to-go rather than specialty ingredient purchases at her two-year-old hybrid specialty store Hip and Stimulating Twenty-somethings are more likely than over-45s to shop at delis, specialty food shops and natural food stores—the three channels most devoted to specialty foods. Merchants can captivate this audience by doing a lot of what they do already. Specialty food by its nature draws the curious and adventurous. “The fact that they are shopping with us means they’re interested in new products,” notes Bi-Rite’s Mogannam.

“We began to attract customers in their 20s or 30s early on because we have a different format than a supermarket,” he says. “We’re a neighborhood location with a young staff. It’s a stimulating environment—we play an eclectic music selection, have hip signage and creative displays. The younger set needs more stimulation than older generations. They grew up with more television and video games and they tend to lose attention quickly.”

In-store events can appeal to young adults. Southport Grocery focuses tastings on easy ways to use products, which draws the twenty-something crowd, says Santos. Reid’s, meanwhile, holds wine tastings every Wednesday and Friday at its in-store wine bar featuring three wines and cheeses. “It’s not geared specifically to young people, but it’s the type of event they’re attracted to,” explains Richards.

Limiting your scope to the younger set can pose problems; for instance, retailers do not want to gain a reputation as a pick-up spot at the risk of alienating older shoppers. “Other entities in Charlotte who tried to gear to under-25 crowds wound up creating uncomfortable situations for some,” notes Richards. “By doing what we do, we draw a cross-section of people who want to expand their knowledge of specialty foods.”

Mogannam agrees, “We differentiate ourselves and create an experience that attracts a younger crowd while keeping older shoppers excited.”

Denise Purcell is managing editor of Specialty Food Magazine.