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millennials

Retail Ready

Retail Ready

               In a world where the Unicorn Frappuccino has already hit the shelves, food and beverage manufacturers have to start thinking even more outside the box to stand out. Recently, these manufacturers are turning away from food items and towards promotional items to appeal to consumers and keep their brands relevant. Companies from McDonald’s and KFC to Hidden Valley and Coca-Cola are all creating items that have little to do with the typical eats they are known for.

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               In September, Taco Bell, announced that they were teaming up with retailer Forever 21 to create a fashion line that includes hoodies, graphic tees, bodysuits, and more. These “fashionable” clothing items range in price from $12.90 to $29.90 and are geared towards the millennials and Gen Z generations. Taco Bell’s clothing line hit Forever 21 stores across the country on October 11, 2017. Another fast food brand getting involved in the fashion scene is Pizza Hut. Their brand created “Pizza Hut Yoga Pants” whose patterns feature triangles that look a lot like pizza slices. These retail at $49.99.

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               Clothing is not the only way brands are tapping into the retail space. Whataburger, a Texas-based burger chain, recently came out with “whatapeiceofjewelry,” a silver charm branded with the multi-W-ed logo of the chain itself. This charm goes for $60.00 a piece, which is not even the most expensive of the food brand jewelry. The Cheetos brand launched a $20,000 orange sapphire and black and white diamond earrings and ring set that was actually sold! Now that’s some series snack dedication.

               Other companies tie their unique items more closely to their signature products. Hidden Valley, for example, created the ranch fountain. The ranch fountain is the savory relative to the sweet chocolate fountain and has already sold out at $89.00 per piece. They also created Hidden Valley bottle coozies for those who are concerned about keeping their dressing as cold as possible at the dinner table.

               Fun products like these often get criticized or made fun of but the cynics are heavily outweighed by the fans. As the CEO of consulting firm BrandTwist said, “Brands are really fighting for mindshare, and they don’t want to just be seen as a very functional brand that helps you satiate your hunger. They want to be a part of your lifestyle too.” As long as companies like Taco Bell and Hidden Valley don’t spread themselves too thin or weaken their core product, creating lifestyle components for their brand seem to be working quite well.  

Get Ready for Gen Z

We’ve heard a lot of talk about marketing to millennials. In fact, Nation’s Restaurant News (along with many other outlets) recently posted an entire article dedicated to understanding this vast and very influential generation, with specific tips for marketing to them. They include: highlighting your social responsibility, showcasing your digital integration and encouraging word-of-mouth recommendations (aka social media posting).

But close on the heels of the food-connected millennial is the super-savvy Generation Z (Gen Z or the iGeneration) and they’ve not only grown up in a culture that revolves around food origins and food media, they’re ready to spend money quickly and efficiently in that space. So it’s time to prepare.  

In its most recent national dining trends survey, Zagat noted an ever-widening gap between the percentages of consumers who prefer to pay with mobile apps (66 percent, up seven percent from 2015) vs. those who don’t (34 percent, down seven percent from last year). No surprise, considering Gen Z-ers have just begun entering the workforce which means those numbers are only likely to increase.

According to a 2016 report by the GfK market research institute, more than half (53 percent) of Gen Z consumers made a mobile payment in the past six months. This is nearly four times the rate (14 percent) of Baby Boomers and almost 1.5 times the rate of older millennials who made mobile payments 37 percent of the time. Predictably, Generation X falls between boomers and millennials, using mobile apps at a rate of 27 percent.

In that same study, roughly one-third of Gen Z shoppers report that they believe mobile payments are more secure than other methods; more than half are looking forward to "more and more transactions" from mobile devices.  

Brands tend to think of being digitally savvy as having a social media presence and engaging with their followers to drive awareness and conversation. But now it’s more feasible than ever to reach your target audience and drive actual monetary conversion. 

Apps in particular present a major opportunity for brands or retailers large enough to support them, and more and more restaurants are adopting mobile credit card scanners to at least meet their diners half way. More and more are creating their own online payment systems. That's great progress, especially considering the top dining deal-breaker in 2016 (according to Zagat’s dining trends survey), is a restaurant with a cash-only policy.

Consumers are only getting younger, so it’s time for brands to update their standard payment practices and at least figure out the next best ways to meet their key audiences where they are: Online.