The economic significance of neglecting Generation X in business operations

The economic significance of neglecting Generation X in business operations

In an era where consumer trends are constantly shifting, a new report from NIQ and World Data Lab, titled "The X Factor," sheds light on a highly influential and often overlooked consumer group: Generation X. Born between 1965 and 1980, Gen Xers are expected to spend a staggering $15.2 trillion in 2025 alone, rising to an annual peak of $23 trillion by 2035.

According to the report, Gen Xers are currently in their peak spending years and will continue to hold the title of the world's highest-spending cohort until 2033. This spending dominance is largely due to their role as "caretaker consumers," balancing the needs of aging parents and dependent children, thus prioritizing convenience and value.

The report highlights three key categories where Gen X is projected to grow its consumption significantly: Food and Nonalcoholic Beverages, Beauty, and Beverage Alcohol. In the next five years, Gen X is expected to increase spending in these categories by $507 billion, $80 billion, and $42 billion respectively.

In an interview with Progressive Grocer, ALDI's buying director discussed the strategies behind flavor-forward adult beverages and a purposeful range of formats aimed at appealing to Gen X consumers. Meanwhile, KeHE's SVP of merchandising shared insights on how young innovators can succeed in the grocery industry while doing good for the world in a TWIG Video.

The report also reveals that Gen X consumers are tech-savvy, with 35% allowing smart devices to automatically order new products, 39% accepting product recommendations from an AI assistant, and 40% leveraging AI to automate and speed up daily tasks. However, 58% of Gen X respondents expressed concerns about data privacy in virtual interactions, avoiding sharing details due to lack of trust in AI data privacy.

Interestingly, Gen X women control 50% of global consumer spend and influence 70-80% of household purchasing decisions. This influence extends beyond traditional supermarkets, with Gen Z, Millennials, and Gen X preferring such other formats as Walmart, ALDI, dollar stores, and club stores over supermarkets.

The Silent Generation and Boomer consumers, on the other hand, chose supermarkets as their top destination. However, a recent study shows that supermarkets have plummeted from the second-most shopped channel among Millennials and Gen X in 2024 to near the bottom this year.

In the realm of beauty, Gen Xers prefer "name brands" made by a big national or international manufacturer over store-branded private label products when buying well-known products (72%). This preference for established brands is also reflected in the beverage alcohol category, where Gen X is expected to increase spending by $42 billion.

The Circana report further finds that 90% of morning meals are prepared in 15 minutes or less, indicating a preference for quick and convenient options. Meanwhile, a new NFRA study reveals that 50% of Gen Z use TikTok for food inspiration, suggesting a shift in the way younger generations are influenced by social media.

In conclusion, the NIQ and World Data Lab report underscores the profound influence of Gen X on the global consumer economy. Brands and retailers who invest in Gen X will see measurable growth and long-term return on investment, making this consumer cohort a crucial target for businesses looking to thrive in the coming years.

[1] Source: NIQ and World Data Lab's report "The X Factor: How Generation X is quietly driving trillions in consumer spending" [2] Source: Progressive Grocer interview with ALDI's buying director [3] Source: KeHE's SVP of merchandising insights in a TWIG Video [4] Source: Marta Cyhan-Bowles, chief communications officer and head of global marketing COE at Chicago-based NIQ, statements about Gen X's role as "caretaker consumers" [5] Source: Wolfgang Fengler, co-founder and CEO of Vienna-based World Data Lab, statements about investing in Gen X for measurable growth and long-term return on investment [6] Source: Circana report findings on morning meals preparation times [7] Source: A new NFRA study on Gen Z's use of TikTok for food inspiration [8] Source: Silent Generation and Boomer consumers' preference for supermarkets as their top destination [9] Source: Gen X women's control of 50% of global consumer spend and influence on 70-80% of household purchasing decisions [10] Source: Gen X's preference for "name brands" over store-branded private label products in Food and Nonalcoholic Beverages, Beauty, and Beverage Alcohol categories [11] Source: Gen X's expected increase in spending on Food and Nonalcoholic Beverages, Beauty, and Beverage Alcohol categories over the next five years (2025–2030)

1. In the Food and Nonalcoholic Beverages, Beauty, and Beverage Alcohol categories, Gen X consumers are anticipated to significantly increase their spending by $507 billion, $80 billion, and $42 billion respectively, showing a strong preference for established 'name brands' over private label products.
2. In the financial aspect of personal-business, investment in Gen X consumers is projected to yield measurable growth and long-term return on investment, as they are set to control a significant portion of global consumer spend and hold the title of the world's highest-spending cohort until 2033.

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