IRI Worldwide: Chase Millennials, but Don’t Ignore Gen X and Boomers

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According to a new study from market research firm IRI Worldwide, alcohol producers shouldn’t ignore Generation X or Baby Boomers in the chase for Millennials’ dollars.

Released Tuesday, the study examines generational trends of U.S. alcoholic beverage consumers. The market research firm reported that Boomers (45 percent of overall beer, wine and spirits dollars) and Generation Xers (20 percent of all alcohol dollars) represent too great of a piece of the marketplace to ignore.

“In doing so, they are walking away from an enormous portion of consumers’ dollars,” IRI reported. “For instance, boomers remain more likely than millennials and Gen Xers to drink once a week or more at home, and they account for a robust 42 percent of overall wine category growth.”

So what kinds of products are Boomers — an “arguably more economically powerful generation than millennials” according to IRI — seeking out? Boomers are not as concerned about choice as younger generations, and they are seeking out products with a lower price point.

Generation X consumers, meanwhile, share similar interests to Millennials, IRI said. Both generations are experimental beverage consumers — they want creative spins on drinks and to try the latest trends — and a third of both generations make their purchase decisions based on what a label or bottle looks like, IRI reported.

And Gen Xers like to drink at home. According to IRI, Gen Xers reported consuming an average of 3.6 different types of alcohol at home in the past three months and 2.8 different drinks at bars and restaurants.

Meanwhile, Millennials are drinking domestic craft beer 37 percent of the time, and they’re making their purchase decisions based on alcohol percentage, label design and new flavor combinations and experiences, according to IRI.

“Millennials also have a large exploratory nature, which is reflected in the choices they make in restaurants and bars, choosing domestic craft beer or vodka most often — 37 percent and 33 percent of the time, respectively,” Chris von der Linden, IRI’s senior vice president of Consumer & Shopper Marketing and beverage industry expert, said in a release.

Other takeaways

Consumers are staying home: Between 66 and 76 percent of consumers said they have a drink at home at least once a week. Compare that to the 23 to 26 percent of people who reported drinking on-premise once per week.

What are they drinking at home? Beer remains the drink of choice, with 73 percent of younger consumers choosing it over wine and spirits.

Retailers should also take note that Millennials, Generation Xers and Baby Boomers are making in-store shopping trips more than once a week — and 40 percent of those shoppers are coming in without a shopping list. Of the 60 percent who show up with a shopping agenda, 21 percent of them change their minds in the store, and half of those people buy a different brand than originally intended, IRI reported.

“When you consider how often most shoppers are going to the store, and the fact that 21 percent of them changed their mind during the actual shopping trip, you realize the impact in-store signage, creative labeling and other marketing could have on your portfolio,” Robert I. Tomei, IRI president of consumer & shopper marketing, said in a press release.

Most drinkers — between 73 and 80 percent of people across all generations, according to IRI — select alcohol products based on taste rather than price. And those consumers view premium beer, wine and spirits as “an affordable luxury.”

It’s also worth noting that all consumers share a desire for lighter alcoholic beverage alternatives, something IRI said represents an opportunity “for existing brands to expand their portfolio and appeal to new demographics.”