Industry needs '360º strategy' to grow with LATAM's $30bn millennial generation – Kantar Worldpanel
Millennials (born between 1981 and 1996 and now aged 22-37) make up one-quarter of Latin America's total population and represent 24% of the region's total spend on fast-moving-consumer-goods – equivalent to US$30bn, according to Kantar Worldpanel's recently published report Demystifying Millennial Families.
So, does this generation present promise for those in the health and nutrition space?
“LATAM millennials connect with sustainability, health and wellness and should be an opportunity for manufacturers,” said Cecilia Alva, clients and new business director for LATAM at Kantar Worldpanel and author of the report.
But, Alva told NutraIngredients-LATAM that targeting this generation required a solid marketing approach.
“Build a 360 degree strategy to grow with millennials in the long-term: they are mobile, they connect with brands online, they seek for better health and nutrition options. Engage with them today to be relevant also in five or 10 years.”
Importantly, she said industry should build connections through “providing [millennials] options covering different occasions” through developing a portfolio of brand tiers, packs and retail environments.
What's new? 84% of LATAM millennials now have kids
Within all this, Alva said it was critical industry understood how millennials had evolved in recent years. Millennials were once known as the super-connected, carefree and self-centered generation – assumptions that had driven marketing decisions for years, she said, but times had changed.
The majority of millennials in Latin America now had children (84%), 42% had up to five kids, and a significant number were under financial pressure, with just 27% working full-time and 49% out of work, according to Kantar Worldpanel.
All of this, Alva said, “definitely” impacted their spending on health and nutrition products but also the types of products they prioritized.
“Millennials with children are tight on budget, as most young families tend to be at that life stage. So, they would be open to prioritize healthier options when its positive impact is proven and immediate for children. Many times, it will require a de-prioritization of other budget destinations,” she explained.
Budgeting was important for a large number of millennials in Latin America, Alva said, given 66% were low-income and more likely to be large families with just one working parent. For example, 58% of women did not have a paid job in low-income millennial families.
“Within the millennial group, there are clear differences between high-income families and low-income families which have a significant impact on their consumption habits and shopping behavior,” she said.
Categories prioritized by low-income millennials, she said, largely centered around their children, for example, with diapers, powdered milk, snacks, biscuits and bread making up 15% of their spend. High-income shoppers by contrast could afford to be more indulgent, she said, prioritizing UHT milk, beer, yogurt, pet food and cheese.
The 'clearer' high-income opportunity
High-income millennial families in Latin America represented just 34% of the total millennial population in the region and were less likely to have kids or tended to have smaller families made up of one or two people.
Alva said it was this smaller millennial group that presented the “clearer opportunity” for dietary supplement and functional food and beverage companies. “Health and nutrition is relevant to them,” she said.
E-commerce could be one platform to target this sub-group and other millennials, she said, given Latin America millennials led engagement in this space. Although she added that associated delivery costs and poor promotional offers versus those available in brick and mortar could restrict traction.
