The foodservice industry, like many others, is hard at work seeking to understand how to effectively target, attract and retain the millennial customer. Currently the largest U.S. generation, millennials have a fast-growing buying power estimated at $200 billion in 2017—a fact not lost on brand marketers keenly focused on gaining insights into what drives millennial decision making.
One of the more predominant traits exhibited by millennials is their desire to support companies with purpose. Not only do they look for brands that produce good food and good products, they desire to support those that also do good things. Four in five millennials say they would be more likely to purchase from a company that supports a cause they care about, and 72 percent say they spend more money on brands that demonstrate social and environmental stewardship. So, what does this mean for the foodservice industry?
For foodservice brands trying to woo millennials, this generation’s interest in supporting businesses with purpose actually represents a major opportunity, particularly for those committed to sustainability and social responsibility. But how can brands demonstrate this focus in a compelling way? Consumer research studies show that millennials rank the use of environmentally friendly packaging as the most important thing a brand can do to demonstrate commitment to sustainability—ranking even higher than the use of renewable energy to manufacture and transport products. Brands are taking notice, with many publicizing new packaging sustainability commitments. McDonald’s is one that is taking action, as the fast food giant announced in January 2018 its plans to have 100 percent of its customer packaging come from renewable, recycled, or certified sources and have recycling available in all its restaurants by 2025.
But what type of packaging do millennials consider sustainable? Two separate studies with more than 4,000 consumers in the U.S. show that when it comes to perceptions of sustainability, appearance matters to millennials. But they were not alone. All consumers that participated in the study were presented with french fries and burgers packaged in either kraft paperboard packaging (brown) or bleached paperboard packaging (white). The results show that while millennials believe that brown packaging is both more natural and better for the environment, so did non-millennial consumers. Further, the majority of consumers that participated in the study believe that brands using brown packaging care more about the environment.
Choosing the right packaging is crucial for brands of all types—with certain substrates being preferred for some industries and not for others. Packaging perception is an important part of the foodservice industry and is closely associated with perceived food quality, as findings show consumers are more likely to think restaurants that use brown packaging also use natural ingredients in their food. This is big news given the increasing level of importance that millennials are placing on natural and locally sourced ingredients.
As companies develop their strategies for reaching millennials, it is imperative to place a priority on packaging. Packaging is a physical representation of a brand and the most outward testament to a commitment to sustainability. While not all consumers will read a company’s corporate social responsibility report, 100 percent will see and interact with its packaging.
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