NEW YORK – Millennials continue to buck tradition, including when it comes to the age-old backyard barbecue. Rabobank reports in its BBQ Index that millennials will spend 73 percent more for their July 4 barbecues than consumers who opt for a more traditional spread.
According to the index, the average of cost of feeding 10 people at a barbecue was $51.90 in 2004. But the cost of throwing a backyard bash has steadily increased. This Independence Day, Rabobank said, consumers throwing a traditional barbecue can expect to pay $69.05, up 83 cents from a year ago. But millennials are expected to pay much more.
The Rabobank BBQ Index uses data from the Bureau of Labor Statistics of the US Dept. of Labor to check prices and track changes over time for common barbecue items, from burgers to produce to ice cream. Rabobank found that consumers buying foods without craft, small-batch, grass-fed and other labels implying “premium” can expect to pay less this Independence Day.
“We’re seeing some really fascinating trends when it comes to consumer purchase preferences among millennials,” said Ross Colbert, head of Food and Agribusiness Research at Rabobank. “Knowing the age group’s partialities to food labels such as organic, local, free-range, and artisanal, for a party of 10, the millennial host is averaging $11.91 per guest, or just over $119 total. The discrepancy between the two barbecues is enormous.”
The largest price increases were seen in the prices of beef, which declined 9.8 percent; chicken, down 7.2 percent; and beer which advanced 6.2 percent, according to Rabobank.
While prices for conventionally raised beef have generally declined, prices for grass-fed beef jumped more than $1 since 2015 to just under $10 per lb., and millennials don’t seem to mind paying more for grass-fed beef because knowing where their meat is sourced is important to them, Rabobank said.
Strong demand for specialty cheeses, which are purchased most often by millennials, has driven up prices for blue cheese, for example. “It is a natural product, high value-add due to its specialized processing, and has shown popularity amongst food-centric pop culture in the US,” Rabobank said. “The limited production capacity, paired with the demand, has driven the price up.”
Meanwhile, commodity cheese inventories have increased, driving prices down.
Another category where millennials will be buying the best for their barbecues is beverages. The price of beer has increased more than 6 percent to $1.37 per 16-oz. can. But millennials tend to gravitate toward craft beers and small-batch liquors the command premium prices. “The price premiums that come with craft spirits account for a large portion of the millennial price tag and today’s popular choices, such as tequila and bourbon, have driven recent growth in the spirits sector, Rabobank reported.
Finally, brioche is the bread of choice for millennial consumers, according to Rabobank. Citing a January Mintel study, 47 percent of consumers want premium buns on their burgers, and the number of brioche buns on burger menus has jumped 59 percent in the last three years, Rabobank said. “Brioche is seen as a premium product in its sector due to the eggs, butter, milk, cream and sugar added during the production process, which gives the bun its pastry-like texture.”
Millennials make up nearly 25 percent of American consumers, so any shift in their purchasing behaviors makes food and beverage companies take notice, Rabobank explained. In 2017, millennials will be the age group with most spending power and will account for nearly 30 percent of the US population.
“The $200 billion spending power of the millennial generation — which just this year has surpassed boomers as the largest generation — is proving to be very disruptive,” said Nick Fereday, executive director of Food & Consumer Trends at Rabobank. “Although they’re a diverse multicultural cohort, a few generalizations still ring true: they're more experimental in their food and beverage choices, health conscious (seeking fewer processed foods), and they also appear to be willing to spend a greater share of their income on food.”
