According to a report by NielsenIQ, GfK, and World Data Lab, Generation Z (Gen Z), comprising those born between 1997 and 2012, is poised to become the most significant economic force by 2030. With purchasing power expected to reach $12 trillion globally, companies need to understand and adapt to their unique preferences, particularly in the food and beverage sector.

Why Gen Z is important for food companies

Representing nearly 25% of the global population, Gen Z is redefining the consumer goods landscape, particularly in the food and beverage sectors. Their purchasing power already accounts for 17.1% of global spending, a figure expected to grow as more young people join the workforce. The consumption habits of this generation present both opportunities and challenges. Gen Z seeks authentic experiences and products that align with ethical values, such as sustainability and transparency, but remains price-sensitive.

Key purchasing behaviors of Gen Z

Below are the key insights and trends regarding the purchasing behaviors of young consumers, which companies can use to build effective strategies for the near future:

• Health-conscious but price-sensitive: Gen Z places great importance on well-being, with more than 50% using fitness apps and actively seeking products that support a healthy lifestyle. They prefer natural, low-sugar, and sustainable products, but remain sensitive to prices. This presents an opportunity for food brands to position themselves as both health-conscious and affordable.

• Digital natives with multi-channel preferences: Gen Z is the first generation of true digital natives, with most of their purchasing decisions influenced by online channels, especially social media. However, 50% of their spending still occurs in physical stores. Companies should therefore invest in both digital and in-store experiences.

• Sustainability and ethics at the core of decisions: Sustainability is a core value for Gen Z, with 77% stating they avoid products from companies with poor environmental standards. However, there is often a gap between what they say and what they buy, as seen in their continued interest in fast fashion and tech gadgets. To bridge this gap, brands need to combine attributes like sustainability, health, and ethical production. Products with at least two or more of these attributes have seen sales grow 2.5 times compared to those with only one attribute.

• Positive outlook on private labels: Gen Z is increasingly inclined toward private labels, viewing them as strong alternatives to national brands. Around 67% of Gen Z consumers believe that private label products match the quality of traditional brands, with the added benefit of competitive pricing. This makes private labels particularly appealing to this generation, who seek the best value for money. Retailers who invest in high-quality, creative private labels can attract and retain young consumers, who often seek novelty and products that align with their values of authenticity and sustainability. The growth of private labels is already evident in Europe and the U.S., with projected expansion of 25-30% over the next decade.

How brands and food companies can appeal to Gen Z

From the data and trends that have emerged, we can identify several key strategies for the food & beverage sector that can be leveraged to maintain and grow market position, both immediately and in the long term:

• Authenticity and transparency: Gen Z can quickly detect inauthentic messages and places high value on brands that are transparent about their ingredients, sourcing, and mission. This generation is highly skilled at identifying when a brand or marketing campaign doesn't truly reflect the values it claims to uphold. Having grown up in a digitally connected world, Gen Z is constantly exposed to vast amounts of information, reviews, and opinions shared on social media. As a result, they have developed a keen ability to distinguish between brands that promote genuine messages aligned with their practices and those that use values like sustainability or inclusivity merely for advertising purposes without real commitment. To earn their trust, brands need to demonstrate transparency and consistency in their actions, avoiding strategies that seem superficial or opportunistic.

• Investing in digital channels: Social media plays a vital role in influencing purchasing decisions. More than 53% of Gen Z has already used social media "buy buttons", making social commerce a key way to reach them. In the next section, we'll explore how companies that leverage online marketing have a greater chance of building loyalty with this generation.

• Innovation: Gen Z is attracted to novelty and playful aspects in everyday products. Food companies must continuously innovate their product lines to offer new experiences, integrating elements of health, sustainability, and creativity.

• Capturing their attention early: Investing in strategies aimed at younger consumers will pay off as their purchasing power grows in the coming years. While they currently account for only 17.1% of global spending, their purchasing power is projected to increase significantly, from $9.8 trillion to $12.6 trillion by 2030.

The digital approach

Gen Z has grown up in a connected world, shaped by smartphones, social media, and online shopping. As a result, digital channels have a significant impact on their purchasing decisions. Platforms such as Instagram, TikTok, and YouTube are not just sources of entertainment but also showcases where young people discover products, compare reviews, and make purchases. This is underscored by the fact that over 53% of Gen Z has already used social media "buy buttons" to purchase directly from posts.

Traditional retail stores can also leverage a digital approach, using technologies like geolocation and personalized promotions to draw young consumers into physical stores and retail chains. For example, integrating localized offers, digital coupons for in-store use, or interactive experiences can make physical shopping more engaging for Gen Z.

Beyond e-commerce (through websites or specialized platforms), social commerce is a critical channel for reaching this generation. However, to do this effectively, companies need to go beyond a basic social media presence: they must adopt an integrated digital strategy that combines multiple aspects of web marketing to create an authentic, engaging experience that align with this audience's expectations.

Let's take a look at some specific strategies that food companies should adopt when using digital channels, with a particular focus on social media.

1. Short and engaging content

For Gen Z, visual content reigns supreme, particularly short and eye-catching videos like those on TikTok or Instagram Reels. With a short attention span, this generation prefers content that is direct and to the point. Companies can develop fun, educational, or compelling video campaigns that tell a story in just a few seconds.

Strategy: produce short-form video content that instantly grabs attention and demonstrates the product's value in action. For food companies, this could mean quick recipes, cooking tips, or behind-the-scenes looks at production, all presented in a dynamic and visually engaging format.

2. Collaborations with influencers

Influencer marketing has shown to be particularly successful with Gen Z. This generation trusts influencers and content creators more than traditional brands or celebrities. Influencers, especially micro and nano-influencers (with smaller but loyal audiences), build authentic connections with their followers, promoting products in a credible and personal way. Food companies can collaborate with food bloggers, chef influencers, or creators focusing on healthy, sustainable lifestyles to promote products authentically.

Strategy: identify influencers who align with your brand values and involve them in creative, personalized campaigns, such as product reviews, tutorials, or live events. It's critical that these collaborations feel genuine rather than forced.

3. Integrated e-commerce and social commerce

Gen Z is used to making purchases directly through social media. Social commerce, where users buy without leaving the platform, is a growing trend. Buy buttons and direct links to e-commerce on Instagram, Facebook, and TikTok make online shopping seamless and intuitive.

Strategy: leverage these features by integrating online stores with social media platforms, streamlining the purchase process and minimizing friction. High-quality visuals and compelling descriptions are essential to driving immediate action.

4. User-generated content (UGC)

User-generated content is especially popular with Gen Z, who tends to trust peer reviews and shared experiences more than brand messaging. Brands can encourage consumers to share their experiences using dedicated hashtags, contests, or other incentives.

Strategy: encourage customers to create and share content featuring your product. This fosters trust and builds a sense of community around the brand. A campaign could reward the best user-generated content or feature it on the brand's official channels.

5. Personalized experiences

Gen Z values personalized shopping experiences tailored to their individual needs. Using behavior-based data for personalization can help engage potential customers by catering to their preferences and interests.

Strategy: implement data analytics and AI tools to collect insights on purchasing behavior and offer personalized recommendations. This could include suggestions based on past purchases, dietary needs, or lifestyle choices. Interactive chatbots and virtual assistants can also improve the shopping experience by providing real-time, customized advice.

Innovating with creativity in the food sector

For Gen Z, innovation means the ability for companies to consistently introduce new ideas, products, or variations that are original, creative, and fun.

Having grown up in a world of digital stimuli and constant newness, this generation looks for products that not only fulfill a need but also provide an engaging experience. In the food industry, this involves creating product lines that combine health and wellness (such as natural or functional ingredients), sustainability (eco-friendly packaging and ethical sourcing), and a playful aspect (whether through a fun dimension or an interactive approach that fosters engagement and entertainment). This could also include eye-catching packaging or innovative flavors.

The outlook for food producers and distributors

For food and beverage producers, distributors, and retailers, capturing Gen Z's attention means diversifying the product range to include items that match their preferences. Focusing on healthy products, sustainable packaging, and transparent supply chains will become increasingly essential, along with adopting multi-channel strategies to ensure that products are accessible wherever young consumers shop.

Food companies are currently facing a monumental shift, as Gen Z is set to become the dominant consumer class. Investing today in the right strategies to earn their trust will secure not only their attention now but also long-term loyalty.