Opportunities arise in young adults market

The spending power of young adults in general is increasing and the average CU (consumer unit) spending on food for at-home consumption has risen in the under-25 age bracket, according to Mintel.

At the same time spending on eating out has dropped, indicating they are cooking more at home, said the Mintel report, “Spending Power of Young Adults - US - October 2008”​.

There are also differences in spending between ethnic groups and Asians aged 18-34 were found to purchase gourmet food more often than other segments, which has implications for product development.

Mintel said: “Today’s young adults are more racially and ethnically diverse than previous generations, which requires that marketers feature minorities in their ads and communication strategies and refocus product developments with multiculturalism in mind.”​

The report said that young adults over-index on alcohol expenditures, which is partly because alcohol advertising is often directed at young adults. Although this type of advertising reflects the high expenditures in this area as well.

There are also indications of an interest in ethical consumption as 49 percent of 18-34 year-olds report shopping at a natural or organic food store such as Whole Foods, and 44 percent report shopping at an ethnic food market such as Bodegas.

Consumer spending​

Mintel said there are more than 71.04m young adults in the US, making up 30.9 percent of the total adult population.

Overall, the total spend by all consumers was $5.752 trillion in 2006, a 5.6 percent increase from the year before.

Consumers under the age of 25 (most of whom are 18 to 24-years-old) spent $230.15bn in 2006 (four percent of the total), and 25-34 year-olds spent $955.02bn (17 percent).