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When considering their most recent visit, among silent generation and boomer consumers, supermarkets register as the top destination for food shopping, according to a recent study from The Feedback Group. However, Gen Zers, millennials, and Gen Xers prefer other retailers, including Walmart, Aldi, dollar stores, and club stores.
Walmart was the top choice for younger consumers as more than a fifth of Gen Zers, millennials and Gen Xers in the poll taken this spring indicated they recently shopped for groceries there.
Supermarkets Appear To Be Losing Ground With Younger Americans
Notably, supermarkets slipped from the second-most shopped format among millennials and Gen X in 2024 to near the bottom in 2025.
Among Gen Zers, 22% indicated they had shopped at Aldi on their last grocer shopping trip, the same as Walmart. Only 8% of Gen Z shoppers, 11% of millennials, and 14% of Gen Xers said their most recent grocery shopping trip was to a supermarket.
"A generational reshuffling is underway, with younger shoppers gravitating more toward other food formats, leaving supermarkets to reevaluate how they engage this critical audience to remain relevant," said Brian Numainville, principal at The Feedback Group and RetailWire BrainTrust panelist, in a statement.
Any shifts away from supermarkets come as consumers across age groups have been trading down due to inflation.
Analysis by Bank of America in spring 2024 found Gen Xers and boomers were already value shopping prior to the pandemic. However, zoomers and millennials began increasing their share of grocery spending at value-tier stores in fall 2023 amid persistent inflationary pressure. Bank of America attributed the shift to “life stage changes” as younger consumers prioritized spending on necessities such as vehicles, housing, and insurance while seeking grocery savings.
Premium Private Label CPG Could See Growth via Gen Z, Millennial Spending
Elevated prices are also driving growth in store brands and a just-released Numerator’s study found Gen Z and millennials "leading the charge into premium private label," including in grocery.
The Numerator study found aspirational yet accessible brands such as Trader Joe’s, Costco’s Kirkland, and Walmart’s Bettergoods range appealing to the two younger generations. Numerator said, “They reflect a desire to buy products that align with both budget constraints and personal values, echoing the post-2008 mindset that once defined Millennials.”
Nonetheless, McKinsey’s “The State of Grocery in North America 2023” survey found 49% of Gen Zers and 48% of millennials willing to pay more for environmentally-friendly product (i.e., zero pollution, recycled materials or minimized packaging) versus 28% of all respondents.
Similarly, a YouGov survey of Gen Z members for Whole Foods conducted last fall revealed 70% are willing to pay more for “high-quality food,” and over half prefer brands that prioritize lower environmental impacts or locally sourced foods.
ICSC’s “The Rise of the Gen Z Consumer” study found the top priorities for Gen Zers in their shopping experience to be quick and easy checkout, cited by 46%; followed closely by fast shipping (45%, and being able to get what they want in-store immediately (39%).
Given their digital savviness, zoomers and millennials are also found to be more likely to shop online for groceries and to be driving the trend toward food discovery via social media. A recent survey of 5,000 U.S. adults commissioned by McCain found 77 % of consumers now make mealtime decisions based on what’s trending online.
Finally, a Wall Street Journal article from 2023 concluded that traditional supermarkets have to find a point of differentiation or they’ll continue to lose ground to more price-driven competitors.