Natural Products Insider

NOV-DEC 2018

INSIDER is the leading information source for marketers, manufacturers and formulators of dietary supplements, healthy foods and cosmeceuticals. Since 1997, INSIDER has been serving the needs of the global nutrition industry.

Issue link:

Contents of this Issue


Page 86 of 166

74 INSIDER November/December 2018 In 2018, Millennials (ages 25 to 34, according to Euromonitor International) accounted for 15 percent of the global population, compared to 42 percent of the population ages 24 and younger, 34 percent ages 35 to 64, and 9 percent ages 65 and older. Millennials' spending power is lower than other working-aged groups. Millennials have an average gross income of about US$12,400 per year globally, but their spending will increase over the next fi ve years to about $15,500 as they enter the workforce and progress in their careers. The combination of a growing Millennial consumer base and their increased spending power over the next fi ve years creates both business opportunities and challenges for companies. Accompanying these demographic changes is a shift in consumer values, which contrasts from the mainstay of values held by Baby Boomers, who account for 9 percent of the global population, but register the highest average gross income in 2018 among all age groups. Although nuances exist in every cohort, and generations are by no means monolithic, key characteristics distinguish Millennial consumers from other generations. According to Euromonitor International's Lifestyles Survey 2017, Millennials agreed or strongly agreed to particular status and consumption values to a greater extent than total respondents. About 66 percent of all respondents like trying new products and services, compared to 72 percent of Millennials. This suggests opportunities for companies to attract the generation through new product launches, but also creates challenges for companies who struggle to retain current Millennial consumers. Millennials also agreed or strongly agreed to other statements regarding status and consumption that emphasize experiences over things and time-saving benefi ts. About 45 percent of Millennials prefer to spend money on experiences rather than things, compared to 39 percent of all respondents and 32 percent of Baby Boomers. Millennials tend to feel more time-strapped than other generations, with 48 percent of Millennials willing to spend money to save time, compared to 41 percent of all respondents and 32 percent of Baby Boomers. Although every generation's attitudes evolve with age, today's changing consumer values are contributing to some of the disruption that consumer packaged goods (CPG) industries are experiencing. These demographic- and consumer-driven shifts have caused established companies to reposition themselves and have allowed smaller, niche companies to emerge. This shift is especially seen in the beauty industry as Millennial consumers are taking a more active, vocal role in redefi ning what beauty and personal care mean to them. Millennials selectively choose brands that not only anticipate their needs and help them discover new things, but also support their ethos and are consistent with images they want to convey. In the beauty world, purpose-driven brands are dominating the conversation and successfully capitalizing on these changing values. For example, direct-to- consumer (D2C) brand and online retailer Beautycounter does more than sell beauty products. In addition to lobbying and educating consumers about what it considers a lack of suffi cient safety regulations in U.S. beauty and personal care products, Beautycounter developed "The Never List," a list of ingredients banned or restricted by the European Union (EU) and other markets, as a way beyond selling products to become a trusted source to consumers. Brands that have unique founder stories present a point of differentiation while also emphasizing purpose-related factors that tend to resonate more with Millennial Millennial Beauty Millennials Prioritize Purpose, Values in Beauty Products by Kayla Villena 20,000 18,000 16,000 14,000 10,000 8,000 USD in current 2018 prices World Average Gross Income by Age Group in 2018 and 2023 Age 25-34 Age 35-64 Age 65+ ■ 2018 ■ 2023 12,399 16,086 16,387 15,539 18,237 17,427 Source: Euromonitor International Source: Euromonitor International 70 60 50 40 30 20 10 % of respondents who agreed or strongly agreed with the statement Values Segmented by Generation in 2017 ■ All respondents ■ Generation Z ■ Millennials ■ Generation X ■ Baby Boomers I like to try new products and services I feel I can make a difference to the world through my choices and actions I like to be distinct from others I am willing to spend money to save time I prefer to spend my money on experiences, rather than things

Articles in this issue

Archives of this issue

view archives of Natural Products Insider - NOV-DEC 2018