Millennials are already redefining the alcoholic beverages marketplace, and their distinctive behaviors and attitudes will have an even more pronounced impact going forward, confirms Nielsen's Millennial Study.
These consumers, currently ages 21 to 34, will make up fully 40% of Americans 21 and older within 10 years, making it increasingly critical for alcoholic beverage marketers to understand their tastes and buying preferences, point out Danny Brager and Jim Greco, respectively VP/group client director and VP, region manager for Beverage Alcohol at Nielsen, in a summary of study highlights.
One key differentiator: Compared to the general population, Millennials are more open to exploring new and different alcoholic beverage products.
While the majority still prefer beer, they purchase relatively more wine and spirits than older generations did at a comparable age. Thus, while consumers traditionally have tended to show a relative shift from beer to wine and spirits as they age and their lifestyles change, Millennials' future consumption patterns are less predictable.
"Millennials' tendency to experiment and try new things will keep them versatile, skipping among a variety of alcoholic beverages," note Brager and Greco. One example: These consumers are more likely to buy locally made products, partly to support their local economies.
Millennials also are more likely to equate product cost with quality, and more likely to trade back up to more expensive alcoholic beverage brands as the economy improves, the study shows.
At the same time, in the currently challenged economy, they are slightly more likely to plan their purchases rather than buy on impulse -- pointing to opportunities to influence their decisions through media. And not surprisingly, the findings confirm that leveraging social media will be critical to Millennial marketing strategies, both to influence them through engagement and to keep alcoholic beverage brands relevant in their perception.
Multiculturalism plays a major role in marketing to Millennials. By 2036, most consumers age 21 and older will be multicultural. "Hispanics, in particular, are swelling the ranks of these newer legal drinking age consumers" -- and their tastes are influenced by cultural factors such as degree of acculturation, as well as their generation's openness to experimentation and to being influenced by the opinions and suggestions of other consumers, point out the Nielsen executives.
"Understanding how Millennials' product preferences may change as they age, while at the same time recognizing the alcohol beverage buying habits of younger, ethnic consumers will be essential for alcohol beverage companies to future-proof their portfolios," they sum up.
The results of the Millennial study, conducted to gain insights on this generation as alcoholic beverage consumers, reflect survey responses from 7,500 consumers age 21 to 34, geographically and demographically representative of the total U.S. population. Conducted in second-quarter 2010, the survey probed attitudes, behaviors, lifestyles and media and retail preferences.
Nielsen's analysis is based on a qualitative and quantitative research examining dynamics such as consumer attitudes, behavior, lifestyle, media and retail preferences to gain insight into Millennials as alcohol beverage consumers. Conducted in second-quarter 2010, the research included online survey responses from 7,500 consumers age 21 to 34, who are geographically and demographically representative of the total U.S. population.