“I wish I could afford to buy good organic produce whilst still being able to pay off my student loans.” This is something I, as a millennial, say to myself every time I go to do my weekly food shop. Millennials like myself have become the focus for many retail industries due to the huge potential that they provide and Whole Foods are looking to take advantage.
Whole Foods Market recently announced their plans to launch a new store that is targeted specifically to millennials. The new stores, that are yet to be named, will be complimentary to the existing Whole Foods Markets but will provide a more limited array of foods at cheaper prices in order to cater for the beliefs and needs of the millennial generation.
Millennials are notorious for being difficult to please; they demand the best yet at low cost. Millennials being the highest users of social media have been brought up using the internet to discern the best value products by trawling reviews and forums. However when it comes to food, most good standard products do not differ a huge amount in price. I know from personal experience, that most of the time if I want cheap produce, I have to take a hit in terms of quality.
Though millennials are commonly associated as being far more concerned about ethical issues behind organic produce, the ‘boomer’ generation account for a far higher percentage of purchasers. Millennials at the moment may be at the start of their careers, not earning as much as boomers whilst paying off student debts. So Whole Foods Markets, Inc. creating smaller stores, with high quality products for cheaper prices is surely a recipe for success within the millennial generation. By setting up these stores in areas filling up with young professionals they will harness a huge market of food values driven people and could create loyalty in a notoriously disloyal demographic of consumers.
The questions on my mind that arise from such an announcement is whether consumers may ask ‘well surely Whole Foods have been ripping us off if they can set lower prices at these new stores?’
Could there be a potential backlash that sees the main stores see a huge decline in customers? This in turn could lead to a decline in bigger stores and an increase in new smaller ones. Will this in turn mean Whole Foods ends as a small food store to rival Trader Joes and other similar companies? If so, will these rivals lower these prices and cause continuous price drops that could create profit decline across the industry? This in turn to me could mean a decline in profit for the farmers and original producers of the food and this is what the millennials are associated with being concerned about.
Despite my negative questions, I do believe the new stores will be a success. Cheaper produce in up and coming areas will definitely be popular with millennials. There are potential roadblocks that should be addressed in a proactive fashion in order to make sure the easily bored and brand disloyal millennials grow up into a new boomer generation who stay with Whole Foods Market, Inc.
About the Author: Harry Kempe, a marketing intern at IIR USA, who works on various aspects of the industry including social media, marketing analysis and media. He is a recent graduate of Newcastle University who previously worked for EMAP Ltd. and WGSN as a marketing assistant on events such as the World Architecture Festival, World Retail Congress and Global Fashion Awards. He can be reached at hkempe@IIRUSA.com.