At the turn of the century, Strauss and Howe published Millennials Rising: The Next Great Generation. In it, they defined this generation, the millennials, as those born roughly from 1982 to 2004.
A quarter of the U.S. population are millennials. This means that over the next few years, this group will determine the success of many industries – including food services.
Our recent research paper, The Gravitational Pull of Fast Casual, reports that a quarter of the U.S. population are millennials. And over the next few years, that’s expected to rise to 40 percent. This means that more than ever, this group will determine the success of many industries – including food services.
So exactly how much influence does this generation have? And in what ways are they impacting and changing restaurant industry?
The driving force of millennials
Changes in diners’ preferences accounts for much of the meteoric rise of fast casual, and since millennials eat an average of four times a week, this makes them the fastest growing consumer segment.
Considering this, restaurants of all types must understand this growth and the changing attitudes in order to succeed.
What drives this group? There are a few things to consider. Millennials tend to be:
- Frugal, but will pay for quality
- Environmentally and socially conscious
- Tech-savvy
- More open to new ideas and new experiences
These are a few of the main drivers responsible for the changing shape of the industry, and have restaurant operators taking note and making adjustments.
The dining experience revisited – the need to compete
Millennials want the quality associated with casual dining, but in a quicker, more convenient format. They want a variety of made-to-order options, without the fuss of waiters and linen tablecloths. And, while they do watch their pennies, they’re willing to pay more to get this experience.
That may sound like a tall order, but it’s the sweet spot in which fast casuals thrive. FCRs serve fresh, customized menu items in a relaxed and social environment, without the formality and expense of full service.
This movement has caused quick-service restaurants to up their game in terms of food selection – not to mention the dining room atmosphere. At the same time, FSRs are competing by offering speedier options and offering more affordable pricing.
Being responsible is as important as the food
Millennials also care about the environment, locally farmed produce, sustainability and other social causes. This means that they gravitate toward businesses that share and exhibit similar attitudes.
This has resulted in a large number of eateries, such as Chipotle, phasing out genetically modified foods (GMO’s). Other restaurants show their dedication to local-sourced meats and organic produce. Still others support high-profile social causes, such as disaster relief or equal rights. Since many millennials identify with these causes, they’re more willing to frequent businesses that support them.
Technology in their DNA
Millennials grew up in the digital age. Many can’t remember a world without mobile phones, the Internet and social media. They use these tools to interact with friends, family and the world around them and are more likely to use them than printed media or even TV.
Mobile device sales now exceed PC’s and laptops, which means millennials are making their buying decisions on the go. Online reviews and postings are often checked first, and then apps such as Yelp are used to share their experiences afterwards.
Due to this trend, successful operators know to provide a mobile-friendly online experience. This improves the guest experience and creates repeat customers.
The evolution continues
Fast casual’s success parallels the changing attitudes of customers across the board, but the millennial generation is certainly one of the primary drivers behind the movements we see in the industry. FCR operators responded to the demands for high-quality, low-fuss fare, have supported their causes and provided the technology options they crave.
That’s why FCRs have and will continue to thrive in this constantly evolving space. And, as QSRs and FSRs work to regain market share and compete, look for them to make some significant changes of their own.
Find Out More About the Explosion of Fast Casual and it’s Impact on the Other Segments
Complete the form below to download the LRS research paper The Gravitational Pull of Fast Casual. This free report examines the explosion of the Fast Casual segment, how diners’ changing preferences are impacting all three of the main categories (quick service, fast casual and full service) and the ways in which all three segments must evolve to compete.
Jason Barge is a marketing manager at LRS and an expert in communications for the hospitality industry.