The way consumers shop today has dramatically changed. In the UK there has been extensive research and detailed insights into how consumers shop and what they expect from brands. When thinking about the brands consumers shop with, the study, which was conducted by Worldpay, found that Gen Z shoppers – those aged 16-20 – have a different relationship to brands than their elders do.

They are less trusting and therefore more discerning when choosing the brands they identify with. As a result, when they find a brand that represents who they are, they show loyalty. However, for Gen X and the Boomer generation – those aged over 35 – the main reason cited for becoming less loyal was the fact that there is now greater choice for the same products so they are more likely to shop based on value.

Today, 76% of consumers are omni-channel consumers. These customers use multiple channels to shop, which highlights the importance for brands to have a connected customer journey across all channels. Customers often use their phones for price comparison whilst they’re in store with 58% doing this, making it an indispensable tool for savvy shoppers. Some retailers are now using phones as a marketing tool, by sending messages, deals and offers to be redeemed in-store, for example the popular high street food retailer Greggs which offers customers rewards. So how have these changing consumer behaviours between different generations changed the food industry?

Utilising technology: brand loyalty

Today’s consumers aren’t carrying large amounts of cash around, and this is compounded by the fact that 57% say they are using less cash than they did a year ago. Nonetheless, 65% of them think cash will still be used as a payment method in five years’ time. Clearly, cash still has a place when it comes to payments. With 30% of boomers carrying between £21-5, 23% of Gen Y carrying less than £5 and 50% of Gen Z carrying less than £10. Contactless has come a long way, and it’s now seen as a safe and reliable form of payment. 65% of consumers would be happy to make a contactless payment up to £50 on their car, including 71% of Gen Y (21-34).

This ties into the hospitality sector because poor service is one of the biggest disappointments when dining out in the UK, followed closely by the time it takes waiting to pay the bill. However, using technology can improve the customer experience and increase brand loyalty. Apps, for example, not only improve the speed of service but also allow the use of personalisation, such as tailored ordering, and offer the chance to embed a loyalty scheme and drive repeat business. These apps are not yet commonplace, but customers value them highly. According to consumers, for brands that do have their own native app, the most important feature is not discounts or savings but personalisation. Consumers want to be able to tailor orders to get exactly what they want and expect technology to make that easy. A feature allowing users to store a favourite meal is also valued particularly highly among Gen Z and Y (16-34.) But for boomers (51-69) the results flipped the other way with the most important aspect of an app for them is access to relevant discounts.

Industry competition: more convenience at a lower cost

UK casual dining restaurants enjoyed a steady growth of about 4.8% from 2012 to 2017. However, that growth is expected to slow to around 2.4%. Consumers want greater convenience at a lower cost and they also want high quality food. Fast casual brands have stepped into that niche and are taking market share from traditional casual dining brands.

The report also highlights three core trends that underpin the behavioural traits of the UK’s consumer when it comes to eating out. First there is the fear of friction. Today’s consumers are used to instant gratification and expect a frictionless experience when they eat out which means that speed and convenience are paramount, particularly when it comes to service. Secondly there is hyper convenience. As well as wanting instant gratification, today’s consumers are used to expediency and personalisation. They can get TV on demand, listen to playlists designed around their musical tastes, and order their usual grocery items in seconds. This environment has created an expectation of convenience and seamlessness, an expectation that continues when they eat out in restaurants. Thirdly there is rational loyalty. This applies to price-conscious UK consumers who are heavily influenced by discounts and offers with many wanting to be part of a reward scheme.

The future: the changing landscape of the industry

With 79% of consumers having eaten out in the past seven days, rising to 85% for GEN Y, 54% of people say they are generally eating out more. Cash-rich and time-poor consumers are driving the trends towards eating out more as they have more to spend and less time cook at home.

Overall most consumers (68%) love finding new places to eat. But true to the stereotype, as you get older you are more likely to settle for places you know when you eat out. 41% of Boomers prefer to eat at their regular locations and are much more likely to repeat visits to places they know. In contrast, 75% of Gen Y prefer to try new places when they eat out and 78% of consumers would be happy to download an app for their favourite restaurant if it meant they can access rewards. This is even higher for 21-34 year olds at 87% and 35-50 year olds at 83%.

Younger consumers frequently take advantage of promotions and offers and are very happy to access rewards via an app, so for brands targeting a younger audience, loyalty boosting apps make sense. These younger consumers are not loyal, so in order to get them to keep coming back to a specific brand, the app should be designed to reward repeat visits via offers and discounts. Brands should look at how they can use technology to reduce the fear of friction, facilitate hyper convenience and deliver value and rewards in the changing landscape of the food retail industry.