The idea of getting into a car and heading to a supermarket seems a bit outdated. It's habit for anyone over 30, but for some younger folks, it may seem as odd as renting a videotape or setting up an answering machine.
In the age of meal-preparation kits being delivered to your door, same-day delivery via Instacart, and an increase in restaurants offering delivery, supermarkets risk becoming as outdated as the evening news. That may be something the industry can avoid, but currently Millennials rate supermarkets lower than Baby Boomers and Generation X across all categories in the Retail Feedback Group's (RFG), 2017 U.S. Supermarket Experience Study.
What are Millennials saying?
It's bad news when the age group that's now the largest generation does not view your type of store positively. That's the case in the supermarket space as Millennials gave supermarkets lower scores than older generations on RFG's report.
"The fact that overall trip satisfaction and all of the core experience factors register lowest among Millennials should be a call to action for supermarkets," said RFG Principal Brian Numainville in a press release. "Traditional supermarkets must find ways to make the supermarket more appealing and relevant to younger shoppers or risk becoming endangered as Boomers age and purchase less."
A loss of relevancy
While Millennials have the poorest view of supermarkets, it's worth noting that Generation X -- roughly the generation born from early 1960's to late 1970's -- rates Supermarkets lower than Baby Boomers in every category except "Staff knowledge/helpfulness" where there was a tie. This suggests that the younger the person, the less likely they are to see the appeal of supermarkets.
That news should concern the various chains operating in this space because it makes the results harder to dismiss. If Millennials were alone in having a lesser opinion of supermarkets that could be passed off as many of them not yet having families or as much need to buy groceries.
The Gen X results, however, suggest that the growth of shopping choices may be negatively impacting supermarkets. For a consumer comfortable ordering groceries through Amazon via Instacart or through countless other services (even things like Wal-Mart's curbside pick-up) the bar for stores gets higher. It's not that Millennials and Generation X members won't shop in supermarkets, but many will hold them to higher standards because they fully understand their choices.
What can supermarkets do?
Clearly, many supermarket chains need to improve the customer experience. That involves everything from training staff better to improving store layouts and adding technology.
"When people shop in a supermarket, the overall experience, assortment, and value proposition need to be excellent in order to earn their next visit," said RFG Principal Doug Madenberg. "There are too many grocery options available online, in hard discount stores, and across other formats, for an average or sub-par supermarket visit to be acceptable."
As has been the case in so many other areas of retail -- as well as in wireless, television, and other markets -- the key change is putting customers first. That could be as simple as laying out stores for convenience so customers get exposed to more shopping opportunities or as complicated as offering apps that take the pain out of the shopping process.
There's no one simple answer for supermarkets, but continued relevance in the digital era requires change. These chains need to give customers a reason to visit -- something extra they get from shopping in-store -- or else Millennials may never adopt the shopping habit of regular supermarket trips like their parents.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Daniel B. Kline has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.
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