Inside Kathy Perrotta's office in the heart of Toronto's tony Yorkville neighbourhood is a computer that can tell her what a teenager in Cape Breton, N.S., ate the day before for his midmorning snack. It can also tell her what a farmer in his mid-50s in rural Alberta had for supper, or what a 30-year-old tech worker in Vancouver ate at her desk for lunch.
For the past three years, thousands of Canadians have sat in front of their computers each day – 20,000 a year – to log their diets for Ms. Perrotta, a vice-president at the research firm Ipsos Canada. The group, which spans all demographics and regions across the country, tell her what they had for breakfast, lunch and dinner, what they ate as snacks in between and why they made the choices they did.
The result is a picture, painted for Ms. Perrotta in real time, of Canadians and their rapidly changing eating habits. And what she has seen is a seismic shift in the food industry, away from the "gatekeeper" model in which the majority of shoppers were mothers buying for their families, toward a highly fragmented one, where anyone with a credit card or some cash is making his or her own food decisions.
Such a divided market requires food companies to acquire pinpoint-specific data about these customers, in order to understand what it is the customers are looking for. Enter Ms. Perrotta and her Ipsos database. Like campaigning politicians, food companies are increasingly using hyper specific demographic data to target their efforts – not just at the boomers and millennials who get the most attention, but also Generations X, Y and Z and subsets within each generation, too.
There are many different ways the food industry uses this data and not just in advertising. Research from Nielsen shows millennials tend to do their grocery shopping on weekends after 3 p.m., while baby boomers shop earlier in the week and in the mornings. This has resulted in scheduling changes at grocery stores in the types of foods offered for in-store sampling. Meanwhile, because millennials are more likely to live in dense, urban environments and less likely to own a car, retailers are increasingly downsizing their stores in favour of smaller downtown locations.
The data are also changing the way food companies communicate with customers. Large companies will broadcast distinctly different messages on their Snapchat or Instagram or Pinterest feeds, which are still different from the messages in their traditional television or print advertising.
And though some criticize such data mining as mass generalizations, marketers say it's still their best chance to succeed in this complicated, granular food marketplace. What the data show, Ms. Perrotta said, is that there's a difference between age and generation. The way the boomers approach being in their 20s, she said, is different from the way Gen X or millennials approached the same life stage.
Or, as a Pew Research study put it in 2010, "Generations, like people, have personalities." Here is what market researchers and food companies believe about the different generations and their different food "personalities."
Generation Z – those born after about 1996 – is the group advertisers are eyeing with the most curiosity at the moment. The group is often referred to as "Generation We" – a nod to the socially conscious "Me to We" mantra many of them are growing up with.
"Of all the generations, Gen We is probably the most savvy and the most educated," says Therese Caruso, the managing director at Zeno Group, a PR firm that recently published a research report on the group. Partly because Gen Z was raised by the Gen Xers – themselves a deeply skeptical group – this younger generation is inquisitive about the world around them and even more committed to bettering it than millennials, she said.
When it comes to food, Ms. Caruso said, "they're very skeptical, they ask questions." With Gen Z, it's not enough for companies to print generalizations on their labels such as "natural" or "healthy," because they wants specifics, she said. "They understand the difference between organic and natural. You can't pull the wool over their eyes."
One of the main differentiators between this generation and the older millennials, Ms. Caruso said, is that Generation Z is willing to go the extra step in researching and understanding the difference between socially conscious products. "They'll go for a campaign that's a little more complicated," she said.
She described the convoluted process for disposing of waste at food courts in places such as Whole Foods. "You can spot the millennials. … If there's too many bins to separate everything, they'll just toss everything into the landfill," she said. "Gen Z will never do that."
One company that both Ms. Perrotta and Ms. Caruso pointed to as particularly popular with Gen Z is Starbucks. The company emphasizes in its advertising its use of ethically sourced and environmentally sustainable products. Its mobile ordering system allows the digitally savvy Gen Zers to order and pay via an online app, or with a prepaid Starbucks card attached, say, to a parent's credit card.
And while its core product, coffee, may seem like an unlikely pairing with such a young group, it's the company's highly customizable menu that seems to be the biggest draw.
According to the company's own website, there are more than 87,000 different drink combinations on offer. A latte can be ordered iced or hot, with whole milk or "skinny," no foam or extra foam and flavoured with syrups ranging from caramel or hazelnut to raspberry.
The Internet yields countless mentions of "Starbucks Secret Menu." A simple Google search unearths dozens of blogs and websites documenting the off-menu concoctions that customers can request – everything from a "chunky monkey frappuccino" (banana, vanilla bean powder, hazelnut and toffee syrup) to a "honey nut macchiato."
Meanwhile, an Instagram search for the hashtag #starbuckssecretmenu yields more than 18,000 results, with custom drinks in all colours of the rainbow – pink, yellow, purple, orange and green.
For marketers, this group, born between 1980 and around the late 1990s, is the ultimate prize. Millennials already make up roughly one-third of the country's population and by 2020 are expected to outnumber boomers as Canada's largest consumer group. They're also considered highly influential.
"I say to food companies: If you get the millennials, you'll get their boomer parents as well," Ms. Caruso said. As such, they're seen as food companies' best bet for focusing their marketing dollars.
As with the Gen Z group after them, the millennials are interested in highly customizable, socially and health-conscious foods. Some of the older millennials are married or have children – such as the "yemmies," or young educated millennial moms, who are looking for what Ms. Perrotta refers to as "mutually agreed-upon" meals for their families – things such as Mexican taco kits to which they can add their own fresh ingredients.
But the younger millennials – referred to as "trailing millennials" – are upending traditional norms of the food industry. More than any other demographic, this group eats outside the home and are most likely to eschew the standard three meals a day.
"It's more small meals through the day when it suits their needs," Ms. Perrotta said. Because this group is more likely to work or study outside of the traditional nine-to-five hours, she said, they expect their food options to cater to this, too. "They do things on their own time. They've never known 'closed on Sundays,' they shop when they want, they work – many of them – in situations that appease their need to have their own schedules."
The food industry is responding. And the changes they make to reach this group affect the product offerings for everyone.
Earlier this year, McDonald's removed its famously strict restrictions on breakfast hours, announcing that it would offer Egg McMuffins and hash browns all day at its U.S. restaurants.
And giant food companies are rushing to acquire smaller, lesser-known snack brands to add to their portfolios. In the past few years, General Mills has acquired Annie's (an organic food brand), EPIC Provisions ("meat-based protein snacks") and Food Should Taste Good (gluten-free chips).
Meanwhile, Campbell's has overhauled the recipes for many of its canned soups to emphasize "real" ingredients and attempted to "snackify" its offerings – rebranding their traditional canned soups in "to go" and microwaveable containers.
Millennials, more than any group before, have a different expectation of food – as not just a commodity, but an experience, experts say. When Nestlé Canada found that Haagen Dazs's brand of "old world tradition" was falling flat with younger groups recently, the company conducted research into millennials' attitudes on luxury, chief marketing officer Tracey Cooke said. "What [luxury] means to millennials is very different," she said. "It's not about things, it's about things you do."
The result was Haagen-Dazs's latest campaign, which features a gold food truck roaming downtown Toronto streets, offering Instagram-worthy, celebrity-chef-created concoctions.
Sometimes referred to as the "sandwich generation," this group that ranges from their late 30s to their early 50s are often overlooked by those more focused on the millennials or boomers.
"They're kind of squeezed in the middle between the behemoth generations," Ms. Perrotta said.
This group is most likely to include families – with parents making the bulk of the food-buying choices for the household. And, because these households are most likely to include working parents, this is the most time-strapped group too, and most likely to turn to prepared meal kits or ready-made solutions to feed their families.
In order to cater to this, Ms. Perrotta said, retailers have sometimes reorganized their stores to make meal planning easier. She said more and more stores are choosing to display items that can be cooked together – such as packaged pasta and jarred tomato sauce next to ground meat – to help Gen Xers looking to put together a meal.
This is also, according to Ms. Caruso, one of the most nostalgic generations, most wedded to the big brands of their own childhoods. "They're still using classic brands like Hellman's mayonnaise, French's mustard," she said. Recent ads, such as Cheerios's "How to Dad" commercials, are aimed squarely at this category of young parents looking for products they know and trust to feed to their kids.
Not surprisingly, this group is focused most of all on healthy eating.
"These boomers are eating with an eye on the future, which is close at hand. They're well aware that their aging brings with it medical conditions," Ms. Perrotta said. With the oldest boomers approaching their 70s, they're especially interested in specific health attributes – for instance, free from excess salt, sugar and trans fats.
Food labels that focus on preventive health or include the word "pure" appear to be especially effective on this group, Ms. Caruso said.
Even more specifically, she said, this is a group looking for foods that will help them feel – and look – younger. "The biggest thing in the area of food for boomers is tell them what their food does for them, and make sure the message includes something about what the food will do for the way they look," she said. Specific labels that explain how, for example, a specific product might affect their hair or nails do especially well.
Paradoxically, boomers also happen to be the biggest consumers of potato chips, Ms. Perrotta said. Ipsos data on snacking behaviour in the evening showed that, of all the generations, boomers were the most likely to turn to potato chips.
This helps to explain ads campaigns such as a recent partnership between Robert Mondavi wine and Miss Vickie's potato chips, which suggest a "perfect pairing" of the two. The ad manages to do two things at once: elevate the Miss Vickie's brand while also planting the idea of wine as an everyday indulgence. The ad is also, Ms. Perrotta said, aimed squarely at boomers.
This group – older than the boomers, typically 70 and older – is aptly named, considering how little attention they are paid by marketers. "They're largely ignored," Ms. Perrotta said – something she calls a missed opportunity.
"The reality is they're a larger share of those consumers than ever before."
This group, she said, is better educated, healthier and wealthier than elderly Canadians in the past. As such, she predicted that food marketers will probably spend more time targeting this group and their unique health considerations.
'The big juicy question'
Whether simple rebranding will be enough to court young generations and secure the future for big food companies is yet to be seen.
Research by companies such as Ipsos and Nielsen suggests what the younger generations want are different products – not just different marketing messages – and ones that are fundamentally opposed to what the big brands are offering.
"They tend to want this unique experience, they tend to focus on this notion of authenticity," said John Cranfield, a professor in food economics and marketing at the University of Guelph. "There's a tendency to not like those large-scale-brand kind of food experiences." And when companies such as Haagen-Dazs try to adopt the traits of the smaller-scale products that are successful with millennials and Generation Z – such as food trucks – the younger generations "see through it," he said.
Rather than rebranding existing products, some larger companies have found success in creating new brands, or buying smaller companies and adding new products to their portfolios. PepsiCo, for example, has in recent years purchased Naked Juice and Stacy's (which makes pita chips), while Coca-Cola has bought Honest Tea, which makes organic iced teas, and Odwalla, the juice and smoothie companies.
But the bigger issue – what Nestlé's Ms. Cooke refers to as "that big juicy question" – of whether these giant food companies will need to completely overhaul their product offerings and the way in which they are organized, is one they are all grappling with.
"It spans everything from innovation, product making, marketing – thinking like a startup is a great place to start," she said. "It's a fundamental question a lot of big food companies are thinking about. We just have to."