Beverages have been a socialising tool, something to gift or something to enjoy and relax with for millennia. However, to be a successful business in the industry and make the most of social favour towards beverages, it is vital to gain an understanding of how it is composed and what influences or desires exist of consumers.
Millennials, currently between the ages of 18-34 years old, are predicted to inject billions of dollars into the US beverage market by the end of 2017, therefore proving to be a market well-worth tapping in to.
Despite the notion that millennials are likely to still be strapped for cash and not having an extensive work experience, they are still turning to alcohol for pleasure. And the picture might not be what you expect.
Millennials are changing the landscape of the alcohol industry; they consider quality alcohols such as good wines and spirits. In the US, millennials comprise only a quarter of adults of legal alcohol-consumption age, yet they are responsible for 30-36% of the sales for good wines and spirits. So what drives these figures? Perhaps a large part of it is cost versus worth.
Cost versus worth can be mutually exclusive and therefore it is not just about searching for the cheapest item. In doing so, one could end up with a booze cabinet full of poor-quality alcohols representing a significant cost in their mass, yet will not be drunk or enjoyed because they are not worthy. Millennials are savvy and are often far more inclined to consider the value of a product rather than just its price-tag. And the way the view value is new too: it is as an amalgamation of ethos and authenticity.
Millennials are reshaping the coffee industry. They are favouring gourmet coffee drinks, which are specialty coffee which include flavoured or gourmet coffees. They also prefer espresso-based and frozen or chilled drinks. A staggering 41% of millennials in a ‘Money Matters’ survey were reported to spend more on coffee in a year than on savings or a retirement plan. Coupled with the desire for innovative products which may be unique in design or taste, millennials represent a fantastic investment opportunity for coffee brands or baristas.
Addressing the needs of millennials
With millennials being 50% more likely to change jobs if the conditions are not desirable than their baby boomer counterparts according to a LinkedIn survey, it is no surprise that they are just as fickle in their brand loyalty and choice of purchases.
In comparison to other generations, millennials enjoy change and adventure, and care about social justice. This means that manufacturers or retailers have a challenge on their hands: they have to produce or source inventory stock that is ethically-derived and eco-friendly, yet must also be accessed quickly as millennials are impatient. This is no easy task, but by tapping into these ideals when considering investing in a product, it is far easier to guarantee success.
Another tool to assist with the fast-changing desires of millennials is inventory management software that is capable of tracking and analysing sales data to create pictures of social trends. Coupled with surveys and even economic psychological information, this inventory sales data helps manufacturers to pre-empt consumer needs and therefore better guarantee sales and long-term profitability.
Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.