New Report: Millennials And Gen-Z Love To Splurge On Groceries

Gen Z doesn't seem to mind an expensive grocery bill while choosing more high-quality snacks and beverages.

Spending money on groceries seems to be a top spending priority for millennials and Gen-Z, according to a new report from McKinsey & Company.

Survey results from February 2024, with participants ranging from baby boomers to Gen Zers, found groceries at the top of the spending priorities for millennials and Gen Zers. The category beat travel, personal care and beauty, restaurants, apparel, and fitness. With over 4,000 responses, the shift has been recognizable since 2018, when the baby boomer and Gen X generations spent more on groceries than millennials.

The shift in spending habits among millennials is not solely driven by new parenthood. A significant health element is also at play. Consumers, on average, anticipate spending more on fresh produce, meat, and dairy, as well as center-store categories like shelf-stable foods or frozen foods. This change is reflected in their shopping habits, as one female millennial from Ohio shared, “We’ve been shopping at the grocery store more often to buy things that are healthier for us.”

“And in the process, we get to save money and spend time with each other cooking and eating together. So it’s really a win-win for everybody.

Gen Z doesn’t seem to mind an expensive grocery bill while choosing more high-quality snacks and beverages. With brands like Liquid Death, a canned water brand, becoming more popular, one Gen Z shopper said, “fancy sodas and drinks” add to the bill. The report also found fewer consumers were switching to lower-priced retailers and brands in February 2024 compared to the end of 2023, thanks to “buy now, pay later” services. “I plan to splurge on myself every now and then. Some of the things I’m most excited to buy are new makeup, new clothes heading into the new season, and even being able to travel to try new foods,” a female Gen Z shopper from Arizona said.

“I definitely think it’s important to have a healthy balance, and splurging helps to enjoy life a lot more.”

Millennials continue to eat meat at increasing levels. According to Supermarket News, millennials spent the most on average per purchase, under $17 per purchase. Gen Xers account for 32% of sales and baby boomers made the list as the most frequent meat purchasers — 53 times per year.

However, every generation is feeling the pressure of grocery inflation. A Moody report found the average American household needs to spend an extra $445 per month to purchase the same goods and services as it did in 2023.