Gen Z Has Arrived. Is Our Industry Ready?

Insights |  4.18.2019

For years, there’s been widespread preoccupation with millennials, not just in the food industry but in all aspects of business and culture. This much-analyzed generation—some now on the cusp of 40 years old—turned the marketplace on its head with their distinct outlook and preferences.

But something happened while so many eyes were on millennials: The generation behind them started growing up. Generation Z (those born between the mid-1990s and mid-2000s) now accounts for 1 out of every 10 consumers. The question is: Are we ready for them?

“It’s important we take time to understand Gen Z now that they are in college and entering the workforce,” says Margaret Rodriguez, Consumer Insights Manager at Aramark. “They are everywhere we serve consumers today. To deliver superior experiences and products, we must first recognize their attitudes and needs.”

THE NEW KIDS ON THE BLOCK

It’s tempting to write off Gen Z as “aspiring millennials,” perhaps with less disposable income by virtue of their age. But are all “young people” truly alike in how they look, feel, and act? Aramark’s recent study* of 800 U.S. consumers—with equal representation among older and younger millennials, Gen Z workers, and Gen Z college students—sought to find out.

“This was our first coordinated effort to gain foundational insights on this cohort as a whole,” Rodriguez explains. “We also wanted to pinpoint what differentiates them from millennials, especially when it comes to expectations for food at school and at work.”

*All study participants attended a school or worked at a company that provides catered dining options at least weekly.

At Aramark, we’ve long understood the importance of focusing on the factors that matter most to consumers when dining away from home, regardless of age: quality, health, convenience, and personalization. This research underscores the need to execute or promote those factors differently to align with our youngest consumers—because it turns out millennials and Gen Z are substantially different, from their core values and purchasing habits to their views on sustainability and health.

Here is a round-up of the key research insights and what they mean for our clients, especially those in higher education and business dining.

QUALITY

Consumers want food that tastes as good as it looks.

Know Food is a Value Proposition: As Rodriguez puts it, “Gen Z cares about food, but they’re not foodies. They want food that is filling and leads with the benefits we commonly refer to as ‘functional foods.’” What’s more, our research shows that they are money-conscious—in contrast to millennials, who are generally willing to pay more for premium food experiences. Our results also indicate that Gen Z spends less money when eating out than millennials but does so just as often. In fact, 56% of working Gen Z preferred free average food over paying for great food. The upshot: If we price food affordably and offer filling menu options, Gen Z will be more likely to perceive the value.

Choose Local & Trustworthy Chains: College-aged Gen Z were excited by local food, as 83% believed it to be healthier and more authentic than national brands. Many of our clients have relationships with local suppliers already in place—so it becomes a matter of marketing. “Highlighting our local connections can go a long way toward building trust with Gen Z,” Rodriguez shares. When considering a partnership with a national chain, steer toward companies that have a good reputation and demonstrate local values. 

Woman picking groceries
A college student shops for fresh fruit prepared daily by Aramark on campus.

HEALTH

Today’s consumers wonder: “Do I have a healthy choice? What will it do for my body?”

Speak to Sustainability: The story of sustainable business practices is particularly powerful for this emerging cohort. “Health looks a little different when we’re talking to Gen Z,” Rodriguez explains. “Yes, their personal health matters, but they don’t think of themselves as on a diet. Instead, they are more focused on the health of the communities they live in.” A lot of this comes down to semantics, she notes. Gen Z associates local food with health, sustainability, and authenticity—whereas older generations think of all those terms as operating on separate planes. A good place to start? Rodriguez advises giving local, seasonal, and plant-forward menu items prominent billing, as Gen Z is keenly interested in minimizing their environmental impact.

Consider Community Classes: Workplaces are micro-communities, and business dining can harness younger generations’ interest in food and foster camaraderie. “Millennials consider food experiences to be the basis for community, whereas Gen Z want to strengthen their community through consumer choices,” says Rodriguez. Our research suggests that nutrition-focused cooking classes can be a winning way to engage both groups when delivered as part of a company’s health and wellness program. 

CONVENIENCE

With hectic schedules and a growing preference for snacks and mini-meals, modern consumers are drawn to portable food delivered on-the-spot.

Understand Their Cravings: From entertainment to transportation to food, this is a generation that’s used to getting everything on demand. College-aged Gen Z like fast food (62% say so in our study), want the option to order ahead (40%), and are even open to having food delivered straight to their desk (38%). “Gen Z expects us to make their lives easier with technology. It’s a universal trend, but Gen Z’s expectations are that much higher,” says Rodriguez. To meet these expectations, consider investing in technology that will let them skip the line

There’s an App for Everything: Consider that Gen Z are the first true digital natives; they grew up in a connected world where data has always been at our fingertips. Food ordering apps can not only improve speed of service, but also leverage data to serve up proactive, personalized recommendations based on a person’s mood or dietary restrictions—something that interests 40% of Gen Z. As Rodriguez explains: “They’re thinking: ‘Why should I have to pick every single specific item myself? You should be offering recommendations based on what you know about me, in addition to letting me leave feedback and reviews.’” 

Man on phone and laptop at table
A newly-hired Gen Z employee checks mobile ordering options in the workplace café.

PERSONALIZATION

Consumers want to feel like their food experience was crafted just for them.

Make it Inviting: One thing that separates younger Gen Z from older millennials, Rodriguez notes, is that they are half as likely to snap Instagram-worthy photos of every meal—and the interior design of dining locations is starting to follow suit. “Restaurant and environmental design is shifting away from this idea of what looks best in photographs and on social media,” she explains. “Now the focus is on creating a cozy, home-like environment.” The right lighting and seating can make a café a home away from home for consumers to enjoy food during the workday—whether they have five minutes to spare, or 45.

Spell it Out for Them: Gen Z’s first instinct is not to read, but to skim. How can we cater to this behavior? One way is to reimagine the menu board and other signage. Gone are the days where allergy-friendly, vegetarian, or other food categories are listed as afterthoughts. “I see us organizing choices so it’s easy for consumers to pick the meal or snack they want to eat, whether it’s to be environmentally conscious or to support personal health and performance,” Rodriguez elaborates. 

ALL GROWN UP

Our consumers span many demographics, so any single client location will serve multiple generations. When we know a new group is about to hit the dining scene, we want to be ready—because once a generation reaches full maturity, it’s almost too late to pivot. Understand your customer base and what drives their dining decision-making, and you’ll be on your way to addressing any gaps, Rodriguez advises.

Granted, it can be a challenge to address generation-specific trends while maintaining wide appeal. That’s where pilot projects help our business. “Higher education tends to be a good proving ground for us to test which innovations resonate with Gen Z consumers,” says Rodriguez. “Meanwhile, our business dining clients are interested in how onsite dining can create a positive experience for the workers they have and those they want to attract in the next five years.” 

In other words, they’re preparing for the arrival of Gen Z.