Young people are abandoning restaurants for an unexpected place

Before you go, we thought you'd like these...
Before you go close icon

What does Whole Foods think millennials want? Lower prices and robots that make tea

Millennials are giving rise to a new concept: the "grocerant."

The grocerant: a grocery store that offers fresh, restaurant-quality prepared foods.

More and more grocery stores are morphing into "grocerants" and devoting a larger part of their stores to prepared foods in a bid to attract more millennials.

Whole Foods' new chain of stores, called 365 by Whole Foods Markets, is a perfect example of this trend. Most of the store is devoted to fresh food buffets and a variety of in-store restaurants.

SEE MORE: 10 US industries expected to explode by 2021

The "grocerant" strategy is working, according to the industry research firm NPD Group.

"Restaurant-quality and fresh food, chef-driven menus, and in-store experiences have given rise to the grocerant and inspiration to millennials to visit and spend," NPD wrote in a recent report.

In-store dining and take-out of prepared foods from grocers has grown nearly 30% since 2008, and accounted for 2.4 billion foodservice visits and $10 billion of consumer spending in 2015, according to the report.

Grocerants get higher marks from consumers in terms of variety and healthy options, compared to fast-food restaurants, NPD reports. Grocery stores' prepared foods are also rated higher for freshness and quality, which are particularly important to millennials, the study found.

EXPLORE MORE: What the DVDs in your collection could be worth

"Many grocers now offer restaurant-quality food at a lower cost than full-service or some fast-casual restaurants," NPD notes. Grocers are also offering a wide variety of fresh foods in specialty categories such as Asian, seafood, Italian, Mexican, and barbecue.

A growing number of grocery stores are also offering dine-in seating for customers.

"Millennials' interest in the benefits and experience supermarket foodservice offers will continue to be strong over the next several years," said David Portalatin, vice president of industry analysis at NPD Group. "This forecast bodes well for food manufacturers and retailers who have their fingers on the pulse of what drives this generational group. Give the millennials what they want — fresh, healthier fare and a decent price —and they will come."

RELATED: See the top retail brands millennials love:

25 PHOTOS
Millennials' favorite retail brands
See Gallery
Young people are abandoning restaurants for an unexpected place
24. Levi's

23. Calvin Klein

Photo via Getty

22. Ralph Lauren

21. Michael Kors

Photo via Getty

20. Walmart

Photo via Shutterstock

19. Macy's
18. Vans

17. Old Navy

Photo via Shutterstock

16. Converse

15. Adidas

Photo via Shutterstock

14. Gap

13. Under Armour

Photo via Getty

12. Bath & Body Works

Photo via Getty

11. Nordstrom

10. Target

Photo via Alamy

9. Urban Outfitters 
8. J.Crew
7. H&M

6. Sephora

Photo via Shutterstock

5. Lululemon

Photo via Getty

4. Zara

Photo via Getty

3. Forever 21

Photo via Shutterstock

2. Victoria's Secret

Photo via Getty

1. Nike
HIDE CAPTION
SHOW CAPTION
of
SEE ALL
BACK TO SLIDE

NOW WATCH: These are America's 2 most hated fast-food restaurants

See Also:
Why this wildly popular chicken chain refuses to fry its chicken
An iconic former Victoria's Secret supermodel just slammed Gigi Hadid and Kendall Jenner
Australia has a knockoff version of a beloved California burger chain — here's what it's like

SEE ALSO: Chick-fil-A just fixed one of customers' top complaints

Read Full Story
Credit Card Compare

Credit Card Compare

Whether you're looking for great travel rewards or low annual fees, find the card that's right for you.

Compare Now

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners