If you were the product manager for a grocery store, you wouldn’t think that you’d have to worry about getting young people to come into your store and buy things, would you? I mean, we all need the food products that grocery stores sell. Traditionally people have always shopped for food the same way: they made up a list, they came to the store, and they bought everything that was on their list. However, it turns out that with the millennials things are a bit different…
Why Millenials Don’t Shop Like Their Parents
So what do we know about millennial shoppers? The one thing that we can say about all of them is that they are in love with e-commerce – they grew up with the stuff. Unlike their parents who planned out what they were going to go buy when they went to the grocery store, government studies have shown that the millennials seem to go grocery shopping less often than their parents did. It looks like it’s time for grocery store product managers to change their product development definition.
One of the big problems that grocery store product managers are facing is that the shopping habits of millennials are different from the people who have made up the bulk of grocery store customers in the past. The millennials are spreading their purchases out over several different options. These options can include online grocery stores such as Amazon’s AmazonFresh, convenience stories that now carry more options, and non-traditional grocery stores such as Wal-Mart and Target stores.
Studies have shown that people between 25-34 years of age spent an average of $3,539 on average for groceries over the course of a year. It turns out that this is $1,000 less than the same group spent back in 1990. When you take a look at everyone who is buying groceries, the average spent last year was $4,015.
What Grocery Store Product Managers Can Do To Attract Millenials
This change in millennial spending patterns is not really the fault of grocery store product managers. Instead, the financial crisis left millennials with a lot of student debt and fairly weak job prospects. The result of this situation is that there has been a drag placed on consumer spending. As proof of this, sales at food and beverage retailers rose by 3.7% between 2002 and 2007. However, spending only rose by 2.4% from 2008 to 2013.
What product managers are discovering is that millennials are putting off marriage and childbearing milestones both of which generally result in more trips to the grocery store. In order to get millennials to shop at their stores, grocery store product managers are starting to roll out smartphone apps that allow customers to place their orders in advance. Do this right and you’ll have something to put on your product manager resume.
Additionally, product managers are starting to introduce new product lines. To help millennials get access to all of the products that the grocery store offers, grocery store product managers are starting to form partnerships with other firms. This include firms that can deliver groceries to customer’s homes thus eliminating the need for them to ever come to the grocery store in the first place.
What All Of This Means For You
You would think that being a product manager for a grocery store would be a good job to have. I mean, your product manager job description says that everyone needs the product that your store sells so you should have no lack of customers. However, what these product managers are starting to discover is that their millennial customers are going to the grocery store less often.
The reasons for the changes in shopping behavior are many. One of the most important ones is because the recent economic crisis has put a dent on the amount of money that millennials have to spend and so they go to the store less and end up spending less. Additionally, since millennials are putting off getting married and having children they have less need for what a grocery store sells. Millennials also have a host of alternative locations where they can drop in and buy the food that they need instead of going to a traditional grocery store. Product managers are reacting to this change in purchasing behavior by starting to create mobile apps that allow customers to place their orders for food online. They are starting to carry new lines of products that millennials can’t get anywhere else and they are now offering delivery service so that customers don’t even have to come to the grocery store any more.
The good news for grocery story product managers is that the products that they sell are critical products for their customers – everyone needs them. However, because of changing lifestyles, these product managers are going to have to change how they offer their products to the youngest generation. The steps that they’ve taken so far are good – they are making it easier to buy groceries. They are going to have to continue to move the world of grocery shopping into the world of ecommerce.
– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Product Management Skills™
Question For You: What can grocery store product managers do to compete with non-traditional grocery stores like Wal-Mart?
Click here to get automatic updates when
The Accidental Product Manager Blog is updated.
P.S.: Free subscriptions to The Accidental Product Manager Newsletter are now available. It’s your product – it’s your career. Subscribe now: Click Here!
What We’ll Be Talking About Next Time
The product managers at McDonald’s have a problem on their hands. A recent study revealed that among younger burger eaters, the millennials, only one in five has ever eaten a Big Mac burger. For a 61 year-old burger chain, this does not bode well for the future. McDonald’s product managers need to take a look at their product manager job description and realize that they have a new job on their hands: they need to figure out how they’re going to go about capturing younger customers.